Monday, September 8, 2008

Stock trading


I bought two stocks last week. Since this is my first time, I took it slow. I studied and I researched. Finally, I decided that these two stocks repesent the best growth possibilities.

I was excited about it. I went and checked my positions the next day and was rewarded with a loss of $100. Ouch! Fortunately, the price bounded back and I only lost $25.

Still, that does represent stock trading in general. You put your money in now, and expect to see rewards in 8 months to 3 years if you're lucky. Lose money if you're not. Not unlike growing a money tree. Can you imagine faithfully watering a sapling everyday only to discover a few months later you have root rot due to too much water?

As for me. I look to the newspaper and see Doom-And-Gloom on every page. No wonder my stock picks sank like proverbial lead balloons!

Be careful not to trade stock for the wrong reason. You invest in stocks to mainly preserve your capital and keep up with inflation, not to provide living expenses. The best time to invest is when you have so much money, you don't know what to do with it. The worst time to invest is when you've just been downsized from your job. Most likely, the economy is in bad shape then.

Most popular stocks according to USA Today: AT&T, Altria, Apple, Bank of America, Chevron, Cisco System, Citigroup, Coca-cola, Dell, Walt Disney, ExxonMobil, FordMotor, GeneralElectric, General Motor, Google, Hewlett-Packard, Home Depot, Intel, IBM, Johnson&Johnson, Merck, Microsoft, Motorola, Oracle, PepsiCo, Pfizer, Procter&Gamble, SiriusXM, Verizon, Wal-Mart.

Of these, I like Coca-cola. I think they are well managed. I wonder why Boeing isn't there?

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