My First Month Investing in the Stock Market!

Before I begin, like everyone that writes about investing I should cover myself with a disclaimer. So here it is:

The Stock Market is not for the fainthearted. The value of investments can go down as well as up. To copy my investment strategy would be madness without doing your own research. Always use a reputable trading company and never deposit any money without reading all the terms and conditions. And finally: Never (EVER!) play around with your trading account while drinking alcohol and watching The Wolf Of Wall Street!

In all seriousness though, if you haven’t invested in the stock market before you must get pretty clued up before you begin. There are literally hoards of scammers out there attempting to trick new investors out of their hard earned cash. They will offer enticing financial incentives like free shares or money, then provide links leading to cloned trading platforms. When you make your first deposit, goodbye bank account!

It is quite simple to avoid any of these scams thankfully. I just made it a rule never to click on a link to any trading platform and always check the URL for abnormalities. If it isn’t an obvious address like a .com, then I would definitely question it further.

So now that we’re all safe, you might want to know how much I made in my first month of investing. But before I do, I should probably explain my investment strategy; because as any stock market investment guru will tell you, it is very important to have one.

While I am no spring chicken at 53 years old, there is still life in the old dog yet. So while other investors of my age play it very safe and try to beat typical savings rates, my dark ambitious side wants me to be more like Gordon ‘Greed is Good’ Gekko (We all have a dark side!)

So after learning all about stock picking, looking at P/E numbers of a company (price to earnings ratio) and looking at long term charts etc, I decided I would diversify my investing into 15 stocks that pay dividends. This means that whether my stock goes up or down in price, the company pays me a small amount each year for support their company. Quite sweet really!

Beside my hand picked stocks, I also invest in something called an ETF (Exchange Traded Fund). These are basically lots of stocks all wrapped up together in a parcel. There are many ETF’s to choses from and you can check which stocks they are invested in before buying. The idea is that they will perform in line with stock markets, which in theory always go up over time.

I now have three ETF funds that I drip feed every week with small amounts. I call it ‘my old man in a caravan fund.’ So when I’m sixty five, hopefully I will have enough to ‘GO TO VEGAS BABY!’ … erm … sorry, I don’t know where that came from. Of course I will buy a caravan … and maybe some old man slippers too.

So now that I am what the the stock market world calls, well diversified, I should be ok if one or two of my stocks nosedives or God forbid, even goes bust. But of course that won’t happen to me because I’m obviously the next Warren Buffet after just one month investing.

I did mention I had a dark side however and of course, like everyone else I would like to become rich quick. So, I have devoted a very small portion of my investments into what they call ‘penny shares.’ Basically, I have invested in a small company, hoping they will become the next Amazon or Microsoft. It is very rare that this happens of course, but if my 10,000 shares in a company that cost me 1.5 cents per share climbs to the same successful heights, I will wave at you all as I pass in my Ferrari shouting ‘told you so’ out the window.

So how much have I actually made in the stock market in a month? Drumrolls please …

Well … while it’s not exactly lifechanging, it has certainly beat any typical savings rate by a country mile. From £1000 invested, so far I have made £67. That is 6.7% in just one month and literally double what my traditional savings account paid for the same amount invested over two years. I think that’s pretty amazing!

Perhaps this time next year I really will be a millionaire.

Thanks for reading.

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Originally published at https://medium.com/never-stop-writing/my-first-month-investing-in-the-stock-market-76d704df0d80