Ads 468x60px

Friday, November 29, 2013


It's right now 11:18 at night as I write this sentence.

I'm sitting cross-legged on my bed, prepared to go to sleep, yet I find myself on this laptop writing something. I have absolutely no idea why.

Thanksgiving is a day in which we are supposed to recount all of the blessings we have been given, and to share them with others. We are supposed to join hands and talk about what we truly value and what we are glad to have in our lives.

I would join in with the norm and recount what I am also thankful for, but I have a small problem with this idea.

That would mean I normally do not value what things I have been granted. I can not think of any day in my life in which I have not been grateful for something. Or someone.

For example, my portfolio. I right now have thousands of dollars to manage.

What kind of stupid parents gives their son that much money to work with?


Every day when I do finance related stuff, I know that my inspiration and my true passion is not completely self generated.

If I had not been allowed to manage that much money when I was 12, I would be nowhere near as interested in the markets as I am now. Without that startup funding, I would be restricted to a crummy simulator. I would have probably stopped by now, most likely for a long time.

Although I have done very well, I still think about the chance that I screw up and lose. Big time. What if that 42.9% gain was instead, a 42.9% loss?

What if the money I was given was cut in nearly half?

What if I had lost some thousands of dollars that my parents had invested in me?

I do not know, and I hope to never find out.

But the encouraging thought is that they were prepared to make that risk. They were okay with the possibility of me losing.

Otherwise, they would have never invested in me.

And I would have never been as excited and eager to learn about finance as I am now.

(I am annotating The Intelligent Investor by Ben Graham, steadily gaining ground)

And I would have never tried.

They gave me the opportunity to do what I wanted by preparing for the possibility of losing thousands of dollars, which seems like a ludicrous idea to me.

And there are so many other kids that could be as interested in finance as I was and am, but their parents just do not trust them enough. They, in turn, do not reach their full potential.

I have been graciously gifted the chance to generate as much wealth as possible for I head off to college as possible, by doing something I enjoy, with the very plausible risk of me losing it all.

That is what I am most thankful for. That single opportunity.


P.S. Get ready for some shorter posts. I want to share my annotations and I have to grind for finals.

Monday, November 4, 2013

How long has it been? 4-5 months?

It has been so long since I have posted it has gotten to the point where it gets to the point where it seems like it will be incredibly hard to post again. Just another way of proving that you should never put off tomorrow what you can't do today.

But the fact is that my portfolio (or portfolios, now) for that matter have not been dormant. I still have been making trades and investments.

As you can most likely see from the Shares 2 app (which is awesome, I highly recommend it for its simplicity and ease of tracking your investments), and the regular TradeKing website, my picks have yielded good returns.

Now let's seriously delve into what reasons I have for picking my two stocks. Obviously, this is nowhere near a diversified portfolio with only two holdings and around $22,500 to manage. 

The chart is decent. I don't make all of my decisions off the chart but it truly helps to recognize technical patterns. The problem I have with technical patterns is what you can see is happening right now, near November. The stock price is stagnating at the 56-58 range.

There are many chart patterns that can or may be created from this.
  • Head and Shoulders. The first head and shoulder has already formed.
  • Channel. The price would continue stagnating along this price range.
  • Ascending Wedge. (At least that is what I think it is called) The price retains the same low and breaks out into higher highs.
That's why I just don't really always go by the chart. Technical analysis is just not worth my

 As you can see, the fundamentals ( - november 4th, 2013) are just fantastic. The stock has some serious earnings growth that is projected and the P/E ratio isn't really that bad for such large expected earnings growth.

Metrics for management are good. ROA, ROI, and ROE are top notch. This is super important whenever I decide on a stock to invest in. Operating and Profit Margins are good, and EPS growth is substantial.

The only other true company in this same industry with this kind of earnings growth is SodaStream Intl.

The problem I have with that stock is that it is a bit too volatile for my taste.

Not by how the daily fluctuations would be large (I could care less about that), but monthly volatility is just a bit too risky for a stock that I would want to be into, and it isn't very far from newly-released IPO status. I dislike especially mid 2011, when the stock lost more than half its value in one month.

So I'll just be leaving that one alone for the time being.

Again, fantastic management metrics and earnings are expected to double next year. Forward P/E ratio would be a mere 20.51, and I think that a company with these PROFIT MARGINS, ROE, ROI, ROA, Good cash reserves and a PEG ratio that just really isn't that farfetched will retain or even enlarge the 43.91 P/E ratio that it haves right now.

It also has a market cap of $3.44 billion. Fun fact: most ten-baggers start out with market caps within the range of $1-5 billion.

Feeling good. I got rid of Tesla a while back (surprise, within the last 4 months I've managed to sell my shares of PDFS and BRK-B and bought TSLA) because it was a bubble stock and that went against everything I stood for. I am not a follower and I don't get into bubbles because bubbles have a 100% chance of popping. Sorry, I haven't posted that as well.

It recently dropped off from its 52-week high anyway these past 2 weeks, so I guess that's a good... decision?

Again, the reason why I am not so diversified is because I truly do believe in these two companies. One is in Con Goods, and another is in Tech, so it's not like I'm getting two stocks from the same sector. That would be bad.

I also think Warren Buffett said that he doesn't believe in diversification if the company is "sound", so that is also another backer of my argument. And he hasn't done too poorly.

But it all boils down to the fact that I can do whatever I want. And I'm not doing too poorly either.


Powered By Software Review