Investments & Wealthsimple

I want to start this off with this is not financial advice. Nor is it an advertisement for Wealthsimple. Anyone who gives you financial advice needs to have certain certifications. This is just my view of investing so far and what has come of it.

I wanted to get into investing when Covid-19 hit the world. The markets were crashing and I knew they'd bounce back afterward as long as you were willing to ride the wave. I tried my bank to set up a meeting for investing but they never got back to me about setting something up through them. It wasn't until mid-2021 that I figured out I could use a site called Wealthsimple both on my computer and through an app on my phone. Finally something that was easy to use and somewhat easy to get the hang of. Where I can transfer excess money from my account into it and begin trading in stocks that I was willing to hedge my bets on.

Investing has been a roller coaster, overall I am still "down" money, because a lot of my investments are in dividend stocks or tech stocks that I am betting on increasing over the next decade or more. But I had a bit of success in the crypto sphere, first losing $100, pulling out, waiting for it to drop some more, then plug $500 back in to pull $1500 back out before the most recent drop. But in another tech stock I am down over 50% of what I put into it.

One thing that I love about the crypto market is because you can buy fractional coins, you can invest any amount you want into it even if it's $1. This caused other stocks to start selling theirs in fractional bits as well, so if you're looking at a tech company that you wanted to invest into, but say the stock was $1000 and you only have $50, you can now put in an order for $50 and whatever the stock is worth at the end of the trading day, you get a portion of a stock that you can then sell at the end of another trading day.

From my experience with the stock market so far, two things I love are dividend stocks and stock loans. To explain what they are, dividend stocks are usually companies that have a steady business model, they've been in the business for years and pay their shareholders either monthly, usually quarterly, or yearly dividends.

Stock loans, at least on Wealthsimple are covered by Wealthsimple in the fact that if the stocks are not returned, Wealthsimple pays for them for you. You maintain full ownership of the stock, so you can sell it at any time, the downside of participating is if your stock is loaned out, you lose on voting rights of each share loaned. Meanwhile you make roughly: (Stock value * 0.08) / (12 months) per month. Not all your stocks get loaned out, but any that are make you passive income like a dividend stock.

The downside of loaned stocks and dividend stocks is that if you want to make a lot of passive income, you need a lot of capital to start with. I have under $10,000 put into stocks and make roughly $50/3 months. They definitely aren't a get-rich-quick stocks to get into. But if you have money collecting dust in your bank account and can go 3+ months without touching it, then it's a decent passive income over time. I personally think a 5% or higher dividend stock is a decent one to buy into because that stock should pay back all that you put into it in 20 years or less.

Then there's the high risk stocks. Either companies that are starting up, growing, reinvesting profits into growing more, or on their death bed ready to become worthless. They're stocks that if you invest into for long term, they could make you a lot of money. Or shorting the stocks you think will crash could make you money or see you owing a lot more than they were worth when you shorted them.

Historical Stocks & What they're worth now

I love looking at some stock histories and seeing how much someone could've made had they got in at the right time. I'll be converting everything to CAD because I am Canadian.

Microsoft (MSFT)

Current Value: ~$563.73

Current Dividend Payout (Quarterly): ~$1.01 (0.72% annual yield)

March 14th 1986 Value: $0.14

December 14th 1990 was when the stock became worth more than $1 USD. People had a little over 4 years to buy into this stock before it'd never see a value less than a $1 ever again.

Had people paid today's value back in 1986 for Microsoft stocks, they could be sitting on 4026 stocks worth $2,269,576.98. That is insane.

Canadian National Railway Co (CNR)

Current Value: $158.71

Current Dividend Payout (Quarterly): $0.85 (2.13%)

November 22nd 1996 Value: $2.15

Had someone bought today's value worth of stock in 1996. They'd own 73 stocks worth $11,585.83. Not as big as Microsoft, but for a transportation company, it shows steady growth. With a potential strike happening soon, the stock might see a drop worth investing in for when it returns to normal.

Roblox Corp (RBLX)

Current Value: ~$59.73

Current Dividend Payout: N/A

March 12th 2021 Value: ~$94.27

Roblox is very popular among kids and young content creators, however it's a stock that has seen its value plummet since entering the stock market. If you invested a year ago today, when it was worth ~$35.73, then you could be up a little over 67%, but had you invested before November 2021 when a lot of stocks seen a crash, you'd be out money. Unless Robolox expands into something new to grow again, it has a limited life span until the next big thing for the young generation comes along.

Meta Platforms Inc (META)

Current Value: ~$714.15

Current Dividend Payout (Quarterly): ~$0.68

May 18th 2012 Value: ~$51.71

Now here's a stock I wish I could turn back time on and slap myself in the face for not investing into. When Meta (formerly Facebook) changed its name and started talking about the "metaverse", their stocks plummeted in 2022. All the way down to ~$122.80 on November 4th 2022. Had I the foresight, being already into trading by this point, put $1000 into Meta I'd have 8.14 stocks for every $1000 invested. That 8.14 stocks now would be worth $5813.18 minus any conversion and trading fees. In less than 2 years I could have had a 581% increase on any money I put into it.

Final Thoughts

My journey into stock markets, investing, dividends, stock lending has been a rollercoaster. A learning experience, and feeling that twang of pain not having the foresight to invest into a crashing stock for the sweet bounce back. But it's a fun one and potentially rewarding one as I age on into my 30's next year.

Between putting spare money into the market to make passive income on and starting up my business by the end of this year, my hope is to someday have enough passive income where I can live off of it and start really giving back to the community while having something I can pass onto the next generation.

While I don't recommend betting everything in the stock market, I see it as a safer and more sure option over buying a lottery ticket. If I am going to throw away $5 for a potential free ticket for another 1/500,000,000,000 chance to win big, I might as well put the $5 into a nest egg and hope it hatches into $20 years down the road. I can always pull that $5 out if it hits $2.50-$3. I can't do that with a lottery ticket if the first 3 numbers aren't on my card.