The Patron - A New Series Following A Beginner Investor

 | Oct 18, 2016 11:01

Originally published by Chamber of Merchants

As my journey begins on a path of learning to manage my emotions while investing, I’ll take a brief moment to introduce myself.

I’m recently married, in my 30’s with a large mortgage that sucks the majority of our income and leaves us little hope for a comfortable retirement. As an investor I have zero experience, and I am limited in any knowledge of the ASX. Why then would I try to invest in the ASX if I have little to no knowledge and even less experience? The answer can be found in my bank statements, where I receive a measly 2% interest on a savings account, or perhaps if you browse over my superannuation statement and notice a return of 0.69%. It is safe to say that these figures are unacceptable and ridiculous!

So my friends, the time has finally come for me to take control of my finances and start making a serious effort to learn and educate myself.Even though I suffer from inexperience…this has not deterred me from entering into the world of investing with a humble sum of $9,999.You may wonder why $9,999 and not the $10,000? Well my account was not set up for transfers larger than $9,999 (yes, I’m aware that I can change those settings now).

h2 “The fifth step was learning I was wrong”/h2

The first step I took was to discuss the idea of investing with my lovely wife, who was somewhat hesitant at first, mainly due to the ideas that some people have:

  1. Losing all your money and becoming broke quicker than an intoxicated gambler
  2. This is just gambling and the house never loses (House being the big investors)
  3. We know nothing about investing

Once my wife and I agreed on a trial period of 3 months, I promised to show a return of at least 7% (I honestly believe this will happen within 2-4weeks) The second step was discussing the options I had and also the emotions I would probably experience during my first week. The third step was taking five companies and spreading evenly between them all. The five companies I chose were Millennium (AX:MOY), Blackham Resources Ltd (AX:BLK), Silver Mines Ltd (AX:SVL), Excelsior Gold Ltd (AX:EXG) and Ramelius Resources Ltd (AX:RMS). I became familiar with the process of buying stocks as I put roughly $2000 into each. The fourth step was sitting back and watching the cash roll in on what I believed to be a passive form of income. I felt great after two days as I made about 2.5%.