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Showing posts from 2011

How not to speculate

Today I'm going to talk about speculation.  Speculation is finding a typically low priced (below $10 per share) stock with the bet that it's going to jump big - double, triple or maybe even more in a short amount of time.  These are still meant to be investments, but sometimes can be a trade - just something a little more interesting that can help grow wealth quickly.  My selection in my current portfolio was Broadwind Energy (BWEN).  In 2010 with gas and oil prices high, I saw this as a pure wind energy play.  I knew initially it was going down and expected it to rebound as I bought it down.  Stock never really turned around though and I never let go.  I kept telling myself "maybe it'll get better next quarter."  That's not a good way to invest - especially in a speculation stock.  When things go bad, you get out immediately, no matter whether it was a loss to you or not.  And that was my problem.  I didn't want to admit defeat and take a loss.  So inste…

New Stock, same theme - Citi

So once again I have another story of a stock that looked like a good choice, but I didn't show the smarts to get out when I should.  You'd think I'd learn more, wouldn't you?  Well, that's what this blog is all about - writing down my reasons for stuff so I can catch my patterns or maybe anyone that's reading can let me know when I'm repeating myself.  This time it's Citigroup (C).  Bought some back in the days when the government was starting to sell the shares they owned as part of the bank saving measures of 2008.  Clearly the company was doing decently.  Restructured itself, was making money, collecting more reserves and preparing to start paying a dividend (in 2012).  All positive notes, but then we had the reverse stock split, the government going after banks for lending practices, mortgage refinances, push for more government regulations, and yes, finally Europe.  Now obviously, when you get a rough market like we've had since October, a lot…

Encana - when timing is just plain wrong

When it comes to blowing it with stocks, Encana (ECA) is certainly one of those rookie learning experiences I've acquired.  At times, I've held this stock for a gain in 2010 as this stock see-sawed between $27 and $35, but since 2011 this thing has been nothing but a dog.  Why did I purchase it?  Well, to start with, I wanted international exposure in my portfolio.  Sure, Canada isn't one of the superior emerging markets, but if you follow stocks and understand the emerging markets at all, you'd realize that there are few examples of companies from other countries that are doing really well right now.  Canada was a strong economy - especially compared to the US, energy was a sector I wanted in my portfolio because, historically, there have been few other areas with the kind of returns as energy stocks.  This particular company was also a play into Natural gas - a fossil fuel that seemed to make sense as a source for future energy as oil has been precariously expensive …

Honeywell - Great company, tough ride

Honeywell was one of my very first purchases.  It's a company I got a lot of interest in for a number of reasons.  To start with, one of my main investment theories right now is that energy management is going to be a huge multi-year theme.  Between trying to save money because energy prices have been climbing coupled with our human interest to be "greener," Honeywell seemed like an awesome fit.  With the financial fallout of 2008, Honeywell was crushed.  The company made a number of moves to change direction and adjust so they could handle downturns and do even better when things go well.  By the time I was interested, they were proving to beat expectations despite a still difficult market - their changes were proving fruitful.  The stock still held a yield around 3% and I couldn't be more happy to acquire shares.  This seemed like a no brainer, and throughout 2010 I couldn't be proven more right, as the stock climbed up to nearly a 50% gain.  However, like my s…

How I've approached my Pepsi Investment

Ok, so I've talked so far about why I'm up to this, I've shared a couple of my first lessons I've already learned holistically, now I guess it's time to show what little I really know and start digging into each of these stocks I own 1 by 1.  Talk about what my investing thesis was, what I felt I "knew" to back that up and what I've done right and wrong up to this point.  I guess I'll just pull one of my 7 out of my hat and start with that one.  Today's choice is...  Pepsico (PEP).

Pepsi was one of the first stocks I wanted to own, but I have yet to have filled my position on it.  For those who live under a rock, Pepsico is a mult-national company which focuses on the production and distribution of a wide variety of non-alcoholic beverages and snacks (uhh, Pepsi for example?).  I've seen numerous interviews with the CEO Indra Nooyi and I must say I was rather impressed with what I heard and saw.  She has a vision of not just making profits…

Failure to follow my basic rules

I'm no day trader.  I have a career to focus on.  So the purchases I make are planned to be long term investments (12-18 months minimum) typically.  I currently hold 7 positions and started creating them in January of 2010.  At this point, I already missed out on the huge gains from the generational lows, but I finally felt comfortable with my own finances that I could put money to risk.  As of today, I hold positions in 7 stocks - C, BWEN, DE, HON, ONNN, PEP, and ECA.  Taking this as a moment to reflect on the past 22 months, there's a lot to learn about myself and investing. 

My portfolio didn't add C or DE until 2011, so let's focus on my portfolio from the perception of the initial 5 (HON, ONNN, PEP, ECA, and BWEN).  I believe in a diversified portfolio.  I also liked the idea of having a little speculation - I'm still relatively young, plus I love the idea of trying to get a big turn around (doesn't everyone wish they bought AAPL back when it was at $5 - o…

The start of holding myself accountable

Today, I've decided to start a blog that tracks what I do and how I think about my investments.  For the most part, this blog is for me to hold myself accountable for what I do, however, if others decide they find this interesting, I look forward to a start of positive communications and idea sharing.  I think you learn the most when there's constructive discussions and I won't accept anything less.

As for me, I'm just a pretty average person.  You'll find I can be a little scattered at times and can ramble.  I try my best, though, it's just difficult sometimes.  I have decided to invest some of my savings in the hope to use my money to make more money.  I'm not rich, I'm not poor, I believe in hard work.  I have purchased stocks already and have been holding them for up to almost 2 years at this point.  I plan to start by laying those positions out talk about where I'm at, what I'm thinking, and what I know I've done right or wrong already.