Seeking sound advice on ambitious investment option

Started by dbarth101
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dbarth101

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First off, I am a 23 year old. I just completed my first year of pharmacy school this past Thursday. I currently work for Kroger, and am waiting to hear back about an interview I had with a hospital this past Monday. If I work both jobs this summer I will make a decent amount (for me at least) to pay for some months of rent for the upcoming school year. However, I come from humbled means and will need to take out approximately 25 grand this year to pay for tuition and the other months of rent for this upcoming school year as a P2. This past year my gas money and food has been paid for by working approximately 18 hours a week during school. My loan award was for $34,000 grand. So if I wanted (which I did not opt to do this past year), I could take out an additional 9 grand approximately. My interesting proposition would be to take out the extra 9 grand and then immediately invest that money into an up and coming stock like say Tesla. (Yes, I know Tesla has calmed down and is trading at $193 a share versus the $250 it was at in March) I am still researching other companies, but I think this would be an interesting, ambitious idea to execute.

What are some thoughts of pharmacists that invest a good amount in stock market? I'm a tyro in the stock market game, but everyone begins somewhere. Everyone's contribution is appreciated, and I will answer any more questions that need to be fielded before you will disclose your opinion. Thanks!
 
That is a terrible idea. To make it worth your while your return would have to be above the interest rate which will be ~6+% depending on which loan you are taking. Even experienced investors can't bank on returns like that. You would not only be taking the risk of the stock, but potentiate it substantially by taking a loan to pay for it. And on top of that you are a new investor so your chances of making any money let alone 6+% probably isn't very high. Also, it is illegal per the terms of the loan. Should I go on?
 
You'll have to pay the loan back with interest, so it's definitely a gamble. I'm assuming your loans are the standard 6.8% interest, so your stock pick would have to be up by at least 7% in order for you to come out ahead, maybe more with fees involved.
 
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PharmEcon said:
That is a terrible idea. To make it worth your while your return would have to be above the interest rate which will be ~6+% depending on which loan you are taking. Even experienced investors can't bank on returns like that. You would not only be taking the risk of the stock, but potentiate it substantially by taking a loan to pay for it. And on top of that you are a new investor so your chances of making any money let alone 6+% probably isn't very high. Also, it is illegal per the terms of the loan. Should I go on?
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Okay that's basically what I wanted to find out was the legality of it. I'm not as much worried about losing in the stock market. Although, I am a beginner that does not mean that I don't know people that have major success in it. Lastly, I should have pointed this out in original post. It would be an investment, and not a ploy to make a quick buck. I would probably invest in a company that I can stick with until I retire, however long that may be. However, I do know of one former pharmacist who did this with google and retired at the ripe age of 40. I realize that a Google type company for the stock market does not come around often, but that would not deter me. Thank you for your opinion though, and for the education on the terms of the loan.
 
dbarth101 said:
Okay that's basically what I wanted to find out was the legality of it. I'm not as much worried about losing in the stock market. Although, I am a beginner that does not mean that I don't know people that have major success in it. Lastly, I should have pointed this out in original post. It would be an investment, and not a ploy to make a quick buck. I would probably invest in a company that I can stick with until I retire, however long that may be. However, I do know of one former pharmacist who did this with google and retired at the ripe age of 40. I realize that a Google type company for the stock market does not come around often, but that would not deter me. Thank you for your opinion though, and for the education on the terms of the loan.
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When you pick a stock out of 10,000 stocks out there in the US, dump your money on margin, you are gambling. It's not an investment.

Google became public in 2004, started at $85/share, now ~$1000 (recently stock split 2:1). Google P/E is now around 26. That was 10 years ago. Your former pharmacist 11X his money.

Tesla initial public offering was $17/share. Now at $190/share. Tesla P/E stands around 130. That means the company has to make 130 times it's yearly earning before it returns a dime to you. You think this stock will have a chance of 11X appreciation from the current valuation? The train has left the station 4 years ago. Although they are trying to make $30k car model, as of right now, Tesla is an ultra luxury product, it'd not gain world wide acceptance like Google at $90k/car. I'd like to say you are a foolish man but what do I know?
 
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Momus said:
When you pick a stock out of 10,000 stocks out there in the US, dump your money on margin, you are gambling. It's not an investment.

Google became public in 2004, started at $85/share, now ~$1000 (recently stock split 2:1). Google P/E is now around 26. That was 10 years ago. Your former pharmacist 11X his money.

Tesla initial public offering was $17/share. Now at $190/share. Tesla P/E stands around 130. That means the company has to make 130 times it's yearly earning before it returns a dime to you. You think this stock will have a chance of 11X appreciation from the current valuation? The train has left the station 4 years ago. Although they are trying to make $30k car model, as of right now, Tesla is an ultra luxury product, it'd not gain world wide acceptance like Google at $90k/car. I'd like to say you are a foolish man but what do I know?
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Well considering the fact that you are comparing P/E's across different formats and business types (Cars vs. whatever you want to classify Google as nowadays), and the fact that you consider someone a fool that seeks other advice, I will go ahead and disregard your opinion. Thanks though, pal.
 
dbarth101 said:
Well considering the fact that you are comparing P/E's across different formats and business types (Cars vs. whatever you want to classify Google as nowadays), and the fact that you consider someone a fool that seeks other advice, I will go ahead and disregard your opinion. Thanks though, pal.
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How about you check Toyota, Honda, Ford, GM P/E and get back to me? Any of them has 100+ P/E, or even 20+? Oh wait, I was wrong, my information was outdated. Tesla has no P/E as of right now. That's right... The company is losing money every quarter LOL. You need to buy this stock immediately, or any stock you like, and make your own mistake.

The wise man learns from the mistake of others. Only a fool learns from his own mistakes.
 
There is absolutely no reason why you shouldn't do this. I would max out my student loans and invest as much as I can in the stock market. Just enroll in IBR/PAYE after you have graduated and after 20-25 years your student loans will be gone. If your stocks go up then naturally you would win. If it goes to zero, the government would take the hit.

Does it get any better than that? You will come out smelling like roses regardless of the outcome.
 
When it comes to investing don't look for a quick buck. Be in it for the long haul and pick funds with low expense ratios!
 
Stupid. Your gambling. You might as well go to Atlantic City and bet all $9,000 on "red" and see what happens. It's not an investment.
 
A little off topic, but you guys have any good recommendations on books or tutorials for students such as OP and myself about how to get into the stock market/investment world. I'm a P2 as well and have a very limited knowledge of it but would like to have a decent idea of how to go about things by the time I graduate.

Side note, I just got eligible for 401K matching from my employer. Should I already be contributing to this or wait until I get a rph job?
 
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Your tax liability should be low so you don't need to put money in your 401 k (tax deferred) unless the match makes it worth it I think you would only need to pay medicare and social security taxes (about 8% total). I would instead put money (after taxed) into your roth IRA (no need to pay taxes on the gains if you cashed out after 59.5 year old).
 
Gambling on borrowed money sounds like a quick way to disaster. That's how a good number of folks went bankrupt throughout history.

If your gamble pays off, good for you. But if it doesn't, then you're in for a lot of anguish for the rest of your life. Ask yourself, is it really worth the gamble?
 
its a good idea, except when do u plan to buy into the market? if theres a war with russia the market will collapse n u'll lose a ton of money. if theres no war, u'll lose a buying opportunity. what's ur gamble on this russia conflict? if u wanna buy n hold then thats something to consider.
 
jballer91 said:
A little off topic, but you guys have any good recommendations on books or tutorials for students such as OP and myself about how to get into the stock market/investment world. I'm a P2 as well and have a very limited knowledge of it but would like to have a decent idea of how to go about things by the time I graduate.

Side note, I just got eligible for 401K matching from my employer. Should I already be contributing to this or wait until I get a rph job?
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1. Get the Neatest Little Guide to Stock Market Investing to start. Read it and understand it. Then get more books and learn. There are also fake stock market investing games online where you can play with faux dollars. These are actually worth checking out and playing with before putting your real money in the market.

2. Depends on the matching. Is it an exact match up to a certain dollar amount? If so, you are doubling your money just by putting it in the 401k. That's a good deal. I'd start now with matching in this situation. If it's a low percentage, it might not be worth it. It partially depends on how many loans you have and the rates you have on them.
 
You can take advice on this forum from anyone about stocks, but take with a grain of salt. You need to learn about investing yourself. Read about rule 1 investing. The guy has a good book on it. It will help you develop some strategies that will help you over years. People on this forum are far from experts in the stock market. You have been warned. Also, be careful with p/e comparisons. People tend to use them as generalizations, but they must always be evaluated. If someone says "this stock is great/bad because of its p/e", you immediately know that person is an idiot--price to earnings is a finite ratio, but its interprepation is somewhat relative; you have to take everything about the stock into consideration ie liquidity, cash flow of company, amount of debt, the moat of the company, roic, immediate capital, position vs competitors, management decisions, other balance sheet considerations, earnings, taxes, dividends, your personal tax situation, ability of the company to grows earnings each year as a percent, risk minimization and so on.Always evaluate the whole situation of the company to determine if you find the p/e appropriate. If the person cant give accurate reason(s) why the p/e is correct/incorrect, that person is a poor investor.
Dont take advice from someone that says "buy low, sell high" and my personal favorite, a coworker that doesn't understand why people "play the stock market".
Happy hunting.
 
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jballer91 said:
A little off topic, but you guys have any good recommendations on books or tutorials for students such as OP and myself about how to get into the stock market/investment world. I'm a P2 as well and have a very limited knowledge of it but would like to have a decent idea of how to go about things by the time I graduate.

Side note, I just got eligible for 401K matching from my employer. Should I already be contributing to this or wait until I get a rph job?
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White Coat Investor The author is active in Boglehead, and here at studentdoctor forum also. Awesome book.
I will Teach you To Be Rich Get the basics down
Bogleheads' Guide to Investing All Around good book

If you can't find the time to read some of these books for an hour or two, you might as well just go to Vegas and bet it all on Black.
 
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A fool and his money are soon parted...

The chances of you beating low cost index funds over the long term is extremely low. Don't be stupid.
 
n64bomb said:
You can take advice on this forum from anyone about stocks, but take with a grain of salt. You need to learn about investing yourself. Read about rule 1 investing. The guy has a good book on it. It will help you develop some strategies that will help you over years. People on this forum are far from experts in the stock market. You have been warned. Also, be careful with p/e comparisons. People tend to use them as generalizations, but they must always be evaluated. If someone says "this stock is great/bad because of its p/e", you immediately know that person is an idiot--price to earnings is a finite ratio, but its interprepation is somewhat relative; you have to take everything about the stock into consideration ie liquidity, cash flow of company, amount of debt, the moat of the company, roic, immediate capital, position vs competitors, management decisions, other balance sheet considerations, earnings, taxes, dividends, your personal tax situation, ability of the company to grows earnings each year as a percent, risk minimization and so on.Always evaluate the whole situation of the company to determine if you find the p/e appropriate. If the person cant give accurate reason(s) why the p/e is correct/incorrect, that person is a poor investor.
Dont take advice from someone that says "buy low, sell high" and my personal favorite, a coworker that doesn't understand why people "play the stock market".
Happy hunting.
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you got my two thumbs up !!!! 👍👍

to the OP: stock market investing and trading takes a lot of hard work and experience. Just like everything else in life, it is not easy. N64bomb hits the nail on head by saying that you need to learn about investing yourself. But it will take years and losing a lot of money to gain valuable experience. Yes, I am saying that everyone will lose money when first learning investing/trading themselves. It is like going to school and pay your tuition because to trade or invest well it really does require a very serious education and experience on this subject. Investing and trading is also a zero sum game. Losers pay winners. Somebody has to lose to pay for somebody to win. Small investors like you and me vs giants like Goldman Sach and Morgan Stanley. It is not easy 🙂

You can learn investing now but better to try it out first with paper-trading/investing (i.e. "fake trading/investiing" vs real trading/investing with real money) to see how well you are doing.

Regarding TSLA, I would avoid to long this one now at current price. It would have to break 150 for me to take a look at it again. If you did not buy it at 30-40, do not hurry to jump in now. Be careful. Read on the company again and answer for yourself what would it takes for giants like GM, Toyota, VW, Honda, Ford, etc to not squash it like squashing a bug yet? Study its fundamentals carefully. Only invest in a stock when you have great confidence in its fundamentals.

For now, you are going to have to trade and not invest in anything as you really want to get real bargains to long. Do you have time to trade while in pharmacy school ?? Even if you could, market is all time high and mostly overbought at this time, so no need to hurry to long anything now. Be patient for real bargains. Very patient !! 🙂
 
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just wanted to echo weelceman on both of his points .. a fool and his money will soon be parted indeed.

you have nearly no chance of beating a low cost index fund over the long period -- seasoned investors who spend their careers (40h+/wk) researching investment strategies largely do not beat the market. your ROI is incredibly low, you will likely be better off financially by conservatively parking your money in an low cost index fund, taking advantage of 401k matches & roth, writing off as much as you can in taxes, and spending the time you were researching stocks picking up another job or bettering yourself professionally.
 
The best way, and I emphasize this, the best way that you can make more money is to do two things.

1) Finish school.
2) Hire a seasoned financial planner when you get your first job as a Pharmacist. He will help you turn that 100k+ job into a much brighter future. He has years of education, experience, and know how about making money. He is so good at making money, that he makes his entire paycheck by increasing the wealth of other people and taking a small cut. Think about that. He makes as much as you do, by taking a very small cut of the profits he brings to his clients. If they didn't make money, he wouldn't either.

Don't try to be two things. Be a pharmacist, and let someone else be the financial guru.
 
anewmanx said:
2) Hire a seasoned financial planner when you get your first job as a Pharmacist. He will help you turn that 100k+ job into a much brighter future. He has years of education, experience, and know how about making money. He is so good at making money, that he makes his entire paycheck by increasing the wealth of other people and taking a small cut. Think about that. He makes as much as you do, by taking a very small cut of the profits he brings to his clients. If they didn't make money, he wouldn't either.
Don't try to be two things. Be a pharmacist, and let someone else be the financial guru.
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Please don't do this.

Swishers said:
You can try options trading if you're feeling super lucky.

http://www.reddit.com/r/investing/comments/23c0wa/i_turned_500_bucks_into_1000000_and_lost_it_all/
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Not this either...
 
Momus said:
Please check S&P return on the same period...
http://quicktake.morningstar.com/index/IndexCharts.aspx?Symbol=SPX

5 year average of 19%... that's right your genius successful financial planner is trailing the market by a whooping 8% >_>;
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I don't know anyone who consistently took in 19% investing in the stocks on the S&P. That number is an aggregate from 500 stocks. Do you know anyone who holds shares in all 500 stocks? That's the only way to make the aggregate percentage consistently every single year. I wonder how much money someone would have to have to invest in one share of ever single stock on the s&p? I would assume it's a large amount. One can buy into a brokerage that does just this, but them you're paying commissions to them and they take a cut of the profits.

Before you go spouting off you would do well to educate yourself.
 
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anewmanx said:
The best way, and I emphasize this, the best way that you can make more money is to do two things.

1) Finish school.
2) Hire a seasoned financial planner when you get your first job as a Pharmacist. He will help you turn that 100k+ job into a much brighter future. He has years of education, experience, and know how about making money. He is so good at making money, that he makes his entire paycheck by increasing the wealth of other people and taking a small cut. Think about that. He makes as much as you do, by taking a very small cut of the profits he brings to his clients. If they didn't make money, he wouldn't either.

Don't try to be two things. Be a pharmacist, and let someone else be the financial guru.
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I know so many "seasoned financial planners" that are actual idiots. Find a good one is like finding a good stock itself. But you can actually learn to invest your money well yourself. It will take some time and efforts.

But I agree with you that the OP should finish school first. That is his top priority. Learn about investing on the side if you want to and have some spare time and maybe play with only a very small money to get your feet wet and get a feel. Build up some experience and wait until starting to work as a pharmacist to start real investing.
 
oldstock said:
I know so many "seasoned financial planners" that are actual idiots. Find a good one is like finding a good stock itself. But you can actually learn to invest your money well yourself. It will take some time and efforts.

But I agree with you on the OP should finish school first. That is his top priority. Learn about investing on the side if you have some spare time and maybe with only a very small money to get your feet wet and get a feel. Build up some experience and wait until starting to work as a pharmacist to start real investing.
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Well said. I just don't think you should gamble with student loan money. It can't be discharged in bankruptcy. It's a brutal contract, the student loan.
 
anewmanx said:
I don't know anyone who consistently took in 19% investing in the stocks on the S&P. That number is an aggregate from 500 stocks. Do you know anyone who holds shares in all 500 stocks? That's the only way to make the aggregate percentage consistently every single year. I wonder how much money someone would have to have to invest in one share of ever single stock on the s&p? I would assume it's a large amount. One can buy into a brokerage that does just this, but them you're paying commissions to them and they take a cut of the profits.

Before you go spouting off you would do well to educate yourself.
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500 stocks only? I hold over 10,000 stocks in total of my portfolio. Please read up something called mutual funds or ETF... you need to really educate yourself.

One of my core holding (40% of my portfolio) is called Vanguard Total Stock Market Index. It has 3698 stocks, including 500 large cap companies listed in S&P. It returns on average 22%/year for the past 5 years. Everyone here that says indexing trumps stock picking, they are talking about more or less copying the performance of S&P 500. And, that's right, these people, including me get on average 20% for the past 5 years if they do indexing.

I know a LOT of people invested in S&P index. The amount of $165 billion is invested in Vanguard S&P 500 only. Please check it here. You can do the same and get 21.15%/year for the past 5 year if you invest on that mutual fund paying $5 for every $10,000 invested every year. A financial planner will take on average 1% of invested assets about $100/$10,000 invested. Why do you need to pay so much to financial adviser for mediocre performance that can't even beat the standard benchmark (S&P 500)? If you can't beat it, copy it.

I have been doing this for almost 6 years and read numerous books. Investing IS my hobby, it's 2nd part of my life. My net worth is about ~900k right now (single income). I'd be a millionaire by 31 (rough estimate). You think I really have no clue what I am doing? Maybe, you should read some of the books I mentioned in this thread.
 
jballer91 said:
A little off topic, but you guys have any good recommendations on books or tutorials for students such as OP and myself about how to get into the stock market/investment world. I'm a P2 as well and have a very limited knowledge of it but would like to have a decent idea of how to go about things by the time I graduate.

Side note, I just got eligible for 401K matching from my employer. Should I already be contributing to this or wait until I get a rph job?
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Now, we are talking!

If you don't need the money (xyz amt.) until retirement, YES put that xyz amt. in 401K or whatever amount they will match. They are matching it-that's 100% return right there. Is there a vesting period= years you need to work to get that matching dollar transfer to you?

Regardless of vesting period, you may or may not get the matched amount if you leave the employer, DO pick a fund that is moderately aggressive with upward performance track record since you are not retiring in the next 5 years. Let's see the magic of compound interest and early investment.

The sooner you invest the better.
 
I know some of you are really down on buying individual stocks, but I don't think that pessimism is always warranted. Not everyone can do it, but I've earned 36.5% annualized growth myself. I've doubled my money in the last year with individual stocks.

You have to know what you're doing, be smart, be disciplined, not make trades all the time (seriously, I don't understand day trading at all), pay attention to the world around you, and have some good gut instincts, but it is possible to do and do well. I know I won't always win, but neither will market indexing.
 
Momus said:
500 stocks only? I hold over 10,000 stocks in total of my portfolio. Please read up something called mutual funds or ETF... you need to really educate yourself.

One of my core holding (40% of my portfolio) is called Vanguard Total Stock Market Index. It has 3698 stocks, including 500 large cap companies listed in S&P. It returns on average 22%/year for the past 5 years. Everyone here that says indexing trumps stock picking, they are talking about more or less copying the performance of S&P 500. And, that's right, these people, including me get on average 20% for the past 5 years if they do indexing.

I know a LOT of people invested in S&P index. The amount of $165 billion is invested in Vanguard S&P 500 only. Please check it here. You can do the same and get 21.15%/year for the past 5 year if you invest on that mutual fund paying $5 for every $10,000 invested every year. A financial planner will take on average 1% of invested assets about $100/$10,000 invested. Why do you need to pay so much to financial adviser for mediocre performance that can't even beat the standard benchmark (S&P 500)? If you can't beat it, copy it.

I have been doing this for almost 6 years and read numerous books. Investing IS my hobby, it's 2nd part of my life. My net worth is about ~900k right now (single income). I'd be a millionaire by 31 (rough estimate). You think I really have no clue what I am doing? Maybe, you should read some of the books I mentioned in this thread.
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Yeah I recommend index funds as well. My net worth is over $500k and I still don't dick around with individual stocks (except my company stock).
 
anewmanx said:
I don't know anyone who consistently took in 19% investing in the stocks on the S&P.
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If you aren't using the market as a benchmark what are you using? The market return is the market return - you could've bought only S&P ETFs and got that return roughly. 8% below the market isn't really much to brag about. Not trying to attack your position, I'm just cautious of financial advisers. When you consider the cost of hiring one + the difficulty in beating the market, most of them do not seem to be worth it. There was an especially good analysis or paper I had read on this recently, but unfortunately can't find it right now...
 
Remember you are competing against professionals and some of them cheat. How are you going to beat them? Stick to the basic.
 
Ackj said:
You'll have to pay the loan back with interest, so it's definitely a gamble. I'm assuming your loans are the standard 6.8% interest, so your stock pick would have to be up by at least 7% in order for you to come out ahead, maybe more with fees involved.
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He needs at least 11 percent to break even. When you are paying back loans, you are paying it with money that is TAXED. You also have to pay additional taxes on any investment returns. Essentially, you have to make at least 11 percent profit to break even.

Lets assume you did borrowed 9000. The interest for that for one year 612 dollars. Assuming a 11 percent return, you made 990 dollars.

You get taxed ~35 percent if you hold the investment for less than a year, and 20 percent over a year (federal + state + local taxes).

Your net profit is 644 for short term, and 792 for long term gains. Once you pay the interest of 612 dollars from the 9000 dollars loan, you are making 22 dollars or 0.0024 percent profit for short term gains, or 180 dollars or 0.02 percent profit for long term capital gain.

That is not counting investment fees, loan origination, etc.

On the other hand, if you make less than 11 percent, you lose lots of money. Unlike other loans, student loans will follow you for the rest of your life.

So all together, horrible idea... DO NOT DO IT!!!!!! BENEFITS DO NOT OUTWEIGH RISK!
 
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Aznfarmerboi said:
He needs at least 20 percent to break even. When you are paying back loans, you are paying it with money that is TAXED. You also have to pay additional taxes on any investment returns. Essentially, you have to make at least 20 percent profit just to break even...

So all together, horrible idea...
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consistently to make 20%+ is hard, and good mention about taxes. Gotta look at the big picture !!

But if I were the OP, I would still learn about investing and maybe play with small amount of money to gain some hand-on experience. Gotta start somewhere and might pay my tuition now with very small amount of money 🙂
 
Momus said:
500 stocks only? I hold over 10,000 stocks in total of my portfolio. Please read up something called mutual funds or ETF... you need to really educate yourself.

One of my core holding (40% of my portfolio) is called Vanguard Total Stock Market Index. It has 3698 stocks, including 500 large cap companies listed in S&P. It returns on average 22%/year for the past 5 years. Everyone here that says indexing trumps stock picking, they are talking about more or less copying the performance of S&P 500. And, that's right, these people, including me get on average 20% for the past 5 years if they do indexing.

I know a LOT of people invested in S&P index. The amount of $165 billion is invested in Vanguard S&P 500 only. Please check it here. You can do the same and get 21.15%/year for the past 5 year if you invest on that mutual fund paying $5 for every $10,000 invested every year. A financial planner will take on average 1% of invested assets about $100/$10,000 invested. Why do you need to pay so much to financial adviser for mediocre performance that can't even beat the standard benchmark (S&P 500)? If you can't beat it, copy it.

I have been doing this for almost 6 years and read numerous books. Investing IS my hobby, it's 2nd part of my life. My net worth is about ~900k right now (single income). I'd be a millionaire by 31 (rough estimate). You think I really have no clue what I am doing? Maybe, you should read some of the books I mentioned in this thread.
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Well, my apologies then. I didn't realize vanguard was giving that kind of performance consistently. Especially considering how many times the market has slumped down hard recently.
 
anewmanx said:
I don't know anyone who consistently took in 19% investing in the stocks on the S&P. That number is an aggregate from 500 stocks. Do you know anyone who holds shares in all 500 stocks? That's the only way to make the aggregate percentage consistently every single year. I wonder how much money someone would have to have to invest in one share of ever single stock on the s&p? I would assume it's a large amount. One can buy into a brokerage that does just this, but them you're paying commissions to them and they take a cut of the profits.

Before you go spouting off you would do well to educate yourself.
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You're clearly not understanding what an index fund is. There's no shame in that though. Yes, you can easily and cheaply own the S&P 500, and the extended market, international market...

I once had a "friend" who was also a "financial adviser." I thought he had my best interests in mind. I was even stupid enough to buy whole life insurance from him. I finally wised up, did my own research and figured out that investing for the long haul can be simple and you certainly don't need to pay someone to do it for you.

Spend some time here www.bogleheads.org/wiki and here www.whitecoatinvestor.com
 
Its definitely a gamble. If you do decide to take a gamble though, think of GFA.
If you're in it to gamble, here is a stock that has a potential to triple in value over the next two years.
I'm heavily invested in this stock and its had two or three consecutive outstanding earnings reports. GFA made a lousy investment on the low incoming house market that led to the stock crashing from $20 down to $2. Since then, its made a come back. Blackstone bought a portion of the company. Goldman Sachs also has a little less than a 5% holding in the company as well. You missed the first boat to buy in when it was at $2.40 but at $3.30 its still a good deal. GFA just announced they were giving a divvy a couple of days ago. Earnings report shows an increase in revenue (and profit) which is a good sign. The world cup and olympics is on the way in 2014 and 2016, which will drive jobs for locals which will strengthen the middle class, in turn, will mean more locals will be able to afford to purchase a home, which is what GFA is all about. Best case scenerio, GFA explodes to $20 by 2016 which is very possible. It has done it before in a little less than a year.
 
rxgolfer said:
Its definitely a gamble. If you do decide to take a gamble though, think of GFA.
If you're in it to gamble, here is a stock that has a potential to triple in value over the next two years.
I'm heavily invested in this stock and its had two or three consecutive outstanding earnings reports. GFA made a lousy investment on the low incoming house market that led to the stock crashing from $20 down to $2. Since then, its made a come back. Blackstone bought a portion of the company. Goldman Sachs also has a little less than a 5% holding in the company as well. You missed the first boat to buy in when it was at $2.40 but at $3.30 its still a good deal. GFA just announced they were giving a divvy a couple of days ago. Earnings report shows an increase in revenue (and profit) which is a good sign. The world cup and olympics is on the way in 2014 and 2016, which will drive jobs for locals which will strengthen the middle class, in turn, will mean more locals will be able to afford to purchase a home, which is what GFA is all about. Best case scenerio, GFA explodes to $20 by 2016 which is very possible. It has done it before in a little less than a year.
Click to expand...

good info. I have not done enough DD on the fundamentals for this stock, but quick glance over its charts I see ~ 2.7's - 3.0's would be a good entry point. What do you think ??
 
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oldstock said:
good info. I have not done enough DD on the fundamentals for this stock, but quick glance over its charts I see ~ 2.7's - 3.0's would be a good entry point. What do you think ??
Click to expand...

I really don't know if GFA will go down to $2.70 again. GFA has picked up a lot of momentum recently. I haven't looked into GFA in a week or so because I was in Vegas but I think looking at the volume today at 1.51 million, that is pretty high which indicates this gaining momentum to move one way or the other. Back when GFA was volatile (up and down 10%, and in the $2.50 range) their daily volume was around 400,000. I don't think GFA will see $2.70 unless something big happens due to macro reasons e.g. escalation of the Ukraine. GFA always moves due to macro events which makes it very volatile and not for the light of heart. With GFA I remember when I wanted to cry when it dropped so much, down to $2.40. I kept buying though. A week later or so later, momentum hit and it was at $3.50. All in all, I think GFA will hit $4 in the next 60 days.
 
rxgolfer said:
I really don't know if GFA will go down to $2.70 again. GFA has picked up a lot of momentum recently. I haven't looked into GFA in a week or so because I was in Vegas but I think looking at the volume today at 1.51 million, that is pretty high which indicates this gaining momentum to move one way or the other. Back when GFA was volatile (up and down 10%, and in the $2.50 range) their daily volume was around 400,000. I don't think GFA will see $2.70 unless something big happens due to macro reasons e.g. escalation of the Ukraine. GFA always moves due to macro events which makes it very volatile and not for the light of heart. With GFA I remember when I wanted to cry when it dropped so much, down to $2.40. I kept buying though. A week later or so later, momentum hit and it was at $3.50. All in all, I think GFA will hit $4 in the next 60 days.
Click to expand...

I will watch and follow it a bit. No need to hurry in this market. Regarding Ukraine, I think it's going to be a non-event. Macro is going to be predictable the way the Fed/Yellen has outlined: continuing of tapering and interest will be raised soon. So while we can still play bounces on the drop short-term on Ukraine situation, long-term no need for us to hurry.

Keep the good stuffs coming. What else that you are watching brother ?? 👍 👍
 
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Actually this reminds me of when I was in school when the real estate market was really hot. People were saying to put their spare student loan money towards buying a condo. One of my classmates said his condo had gone up so much and was now worth enough that he could sell it and pay off all his student loans. My own landlord tried to sell me the place I was staying in for $200k. Well then the market collapsed and lots of people had to foreclose and walk away from their houses. I looked up the condo I stayed in on Zillow.com and it's now worth about $90k.

So everyone thinks they're going to hit the jackpot with their investments, but they don't believe in, or underestimate the risks. That pretty much makes it like gambling.
 
One thing I always tell people about being an investor, especially a high risk investor, is to always have a comfortable amount of safe money first. The logic behind this, aside from the obvious that you could lose the entire investment, is that having safe money will actually make you a better investor in that you will be less likely to give in to emotions that could potentially do major harm to your returns. Basically, what I am saying is, if you want to try to swing for the fences go ahead and do it, but make sure you leave enough that you can still pay the minimum on your loans and your essential living expenses.
 
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Dr Wario said:
One thing I always tell people about being an investor, especially a high risk investor, is to always have a comfortable amount of safe money first. The logic behind this, aside from the obvious that you could lose the entire investment, is that having safe money will actually make you a better investor in that you will be less likely to give in to emotions that could potentially do major harm to your returns. Basically, what I am saying is, if you want to try to want to swing for the fences go ahead and do it, but make sure you leave enough that you can still pay the minimum on your loans and your essential living expenses.
Click to expand...

excellent advice !!
 
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