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"Start with $1000..."

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opieshuffle

Well-known member
Oct 30, 2004
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...I was given this book years ago and never read it. Mainly because all monies over the years have gone into paying down mortgages etc. Now I find myself in a position to actually take a few grand and try to make it grow. Peanuts to most I know, but before I pick up this book, anyone have any better reading recommendations? I'd like to invest 2gs and see how I could make it grow.

I am a complete NOOB at investing, so if the general consensus it to just toss it into an RRSP or use it to pay down my mortgage (I'm credit card and car payments free), I'll go there too, but I'd rather take a few risks since it's "found money"...sort of.

All input is greatly appreciated.

OP
 
two books for the beginner do-it-yourselfer...

The Lazy Investor by Derek foster
The wealthy Barber by david chilton

sounds like you have significant equity in your mortgage so its possible for you to do some really cool stuff such as the "smith manoeuvre", but not recommended for the beginner investor...
 
Ginglay said:
two books for the beginner do-it-yourselfer...

............................................
The Lazy Investor by Derek foster
..............................................
Click to expand...

Written by a charlatan who sold all his holdings near the market bottom
last year in anticipation of more pain to come. To his credit he did reveal
that after all he himself could not adhere to the 'buy and hold dividend
stocks forever' investment advice provided to newbie investors in his
books. This shows he is at least a man of basic decency and honesty.
 
If I were you, I would probably contribute to RRSP and invest in the amount that matches to the % your employer contributes annually, assuming there's a DC plan.

The downside are the selection of funds is limited and the majority of the mutual funds are actively managed. Moreover the MER tends to be higher than the same product available outside the plan since the insurance companies may pay trailer/kickback to your employer to secure/lock in contract to manage your pension plan.

Still, it's better than saving nothing and walk away "free money" from your employer...as long as you manage your risk prudently.

Once you automate your retirement accounts, you should set up emergency funds with 3 months expenses min in TFSA high interest savings account. Always a good idea to avoid tax legally, no matter how "insignificant" the amount would be. Whatever remaining afterward you should aggressively pay down mortgage asap.

It's even better when you are able to squeeze additional cash to do so, say living frugally and spend less on hobbying...;)
 
oil&gas said:
Written by a charlatan who sold all his holdings near the market bottom
last year in anticipation of more pain to come. To his credit he did reveal
that after all he himself could not adhere to the 'buy and hold dividend
stocks forever' investment advice provided to newbie investors in his
books. This shows he is at least a man of basic decency and honesty.
Click to expand...

I'm not so sure the decency and honesty part.

What I do believe though is with guy like this is getting a lot of exposure on roadshows and headlines, it's a call sign the bubble is going to burst and hence lower your risk profile.

For the more aggressive one, you could short the stocks and investments that he suggested....;)
 
Open a Tax Free Savings Account with a Discount brokerage firm ie RBC Direct Investing , Scotia Itrade.....
A book that I consider to be my bible of investing is the "Investment Zoo" by Stephen Jarislowsky....

Good luck.

bruce
 
I'd second theycallmebruce's suggestion. Depending on your risk, though, you could invest in some ETFs (exchange traded funds), that track major stock exchange's holdings (like TSE 60 or DJIA). You might also want to check out some real-estate investment trusts (or other stable companies that pay stable, increasing dividends over time). Just my two cents...
 
Learn technical and fundamental analysis methods on stock market and do your own research instead of giving your money to a fund manager or broker. Majority of mutual funds could not even beat market index for the last 50 years, your guess is probably just as good as "professionals". The key difference you need to have a discipline in money and risk management. Usually this means don't invest everything into one or just a few stocks. Diversify as much as you can to weather the storms. Also try to overcome your emotions of greed and fear. A good book I recommend is "High probability trading" by links.
My view on investing is people amd especially media try to oversell the important of "breaking news", and people flock to buy the stock if there is a good news, and sell the stock when the news is bad. You do not want to become a "news" trader, because when the news comes out the price action is already taken - the news is "priced in". you are already too late. Do not subscribe to any financial news and spend hours and hours looking for the latest news because there is always 10000 people ahead of you. Instead try to predict what is going to come out. My experience is there is no better way the using good old fashions chart pattern analysis. Strangely enough, news always come out in time to form and shape the chart so it fits the patterns. Sometimes even bad news gets interpreted as good news just so that price movement fits the pattern, so go figure. One website I recommend is www.screenulator.com it is non-profit unlike many other fancy looking stock sites, but has great number of chart patterns screened daily. You can also get free charts from www.stockcharts.com, and basic tutorial of chart analysis. You have to use your judgement though, they do not just tell you which stock to buy or sell, you need to know some chart pattern basics. It is literally a gold mine for me. I have made tens of thousands using trendline analysis category.
 
If you are willing to spend a significant amount of time and energy to learn the market, I can point you to some books and resources that have worked for me.

If you are not interested in this, I recommend finding some index ETF's or mutual funds (the funds being no load, low MER) based off indexes to dollar cost average in.

Also I recommend you read the Millionaire Next Door. It has very little to do with investing and more about basic money management.
 
opieshuffle said:
...I was given this book years ago and never read it. Mainly because all monies over the years have gone into paying down mortgages etc. Now I find myself in a position to actually take a few grand and try to make it grow. Peanuts to most I know, but before I pick up this book, anyone have any better reading recommendations? I'd like to invest 2gs and see how I could make it grow.

I am a complete NOOB at investing, so if the general consensus it to just toss it into an RRSP or use it to pay down my mortgage (I'm credit card and car payments free), I'll go there too, but I'd rather take a few risks since it's "found money"...sort of.

All input is greatly appreciated.

OP
Click to expand...

$2,000 bucks? Not much, a start.

How about one of the Canadian banks? Pick one and don't worry about it, or:

The TD Waterhouse Canadian Dividend Portfolio - Top 10 Holdings:

Company | Ticker | Sector | Portfolio weight % | P/E ratio | Price to book

Bank of Nova Scotia BNS-T Financials 8.12 10.84 2.29
Royal Bank of Canada RY -T Financials 7.68 10.76 2.43
Enbridge Inc. ENB-T Energy 6.18 18.28 2.48
Bank of Montreal BMO -T Financials 5.81 10.47 1.7
TransCanada Corp. TRP-T Energy 5.22 16.33 1.6
Imperial Oil IMO-T Energy 4.75 14.03 3.64
Power Corp. of Canada POW -T Financials 4.41 11.13 1.48
Shaw Communications Class B SJR.B-T Consumer Discr. 4.15 13.92 3.57
Canadian Oil Sands Trust COS.UN-T Resource 3.96 17.67 3.59
Sun Life Financial SLF-T Financials 3.75 10.95 1.18


Statistical analysis updated quarterly - the most recent update was Jan. 6/2010. Source: TD Waterhouse
 
Dragon.i said:
$2,000 bucks? Not much, a start.

How about one of the Canadian banks? Pick one and don't worry about it,
Click to expand...

Good idea in 2009. Not so much in 2010 since the bank stocks in general are fully valued.

If you incline to invest in financial stocks, you would get better odds by investing in SLF, PWF or MFC IMHO.

Dragon.i said:
or: The TD Waterhouse Canadian Dividend Portfolio - Top 10 Holdings:

Company | Ticker | Sector | Portfolio weight % | P/E ratio | Price to book

Bank of Nova Scotia BNS-T Financials 8.12 10.84 2.29
Royal Bank of Canada RY -T Financials 7.68 10.76 2.43
Enbridge Inc. ENB-T Energy 6.18 18.28 2.48
Bank of Montreal BMO -T Financials 5.81 10.47 1.7
TransCanada Corp. TRP-T Energy 5.22 16.33 1.6
Imperial Oil IMO-T Energy 4.75 14.03 3.64
Power Corp. of Canada POW -T Financials 4.41 11.13 1.48
Shaw Communications Class B SJR.B-T Consumer Discr. 4.15 13.92 3.57
Canadian Oil Sands Trust COS.UN-T Resource 3.96 17.67 3.59
Sun Life Financial SLF-T Financials 3.75 10.95 1.18
Click to expand...

Instead of investing in this portfolio, you could get pretty identical exposure and significant better diversification by investing in XDV & XEG

http://ca.ishares.com/product_info/fund_holdings.do?ticker=XDV

http://ca.ishares.com/product_info/fund_holdings.do?ticker=XEG
 
hinz said:
Good idea in 2009. Not so much in 2010 since the bank stocks in general are fully valued.

If you incline to invest in financial stocks, you would get better odds by investing in SLF, PWF or MFC IMHO.



Instead of investing in this portfolio, you could get pretty identical exposure and significant better diversification by investing in XDV & XEG

http://ca.ishares.com/product_info/fund_holdings.do?ticker=XDV

http://ca.ishares.com/product_info/fund_holdings.do?ticker=XEG
Click to expand...

I was not suggesting that the entire portfolio be bought. But rather go with one as those were high on the dividend list as per TD Waterhouse.
Btw, 1k hardly should be invested in iShares for diversification (even for TD's) and not to mention a MER of 0.5%. Instead go for single stock for apprecation and dividends (and no worries).

Canadian financials:
Future expections (i.e. earnings growth 2011; and forecasts for 1Q, 2Q, 3Q, 4Q), as long as it's good, then 2010 can also be a good year. One should not just wait for the bank stock to go up only (as it did for 2009) because of the credit crisis in late 2008.
 
You would have had an amazing return had you bought Gold back in 2000 http://www.kitco.com/LFgif/au00-pres.gif.

Then again, I think the US economy is poised to fall, so maybe gold is still a good buy.

(even if the price of gold goes to 0, you still have a nice bar of gold). Check out Canadian Coin & Currency at Yonge & Maj Mack
 
torpedo30 said:
Learn technical and fundamental analysis methods on stock market and do your own research instead of giving your money to a fund manager or broker. Majority of mutual funds could not even beat market index for the last 50 years, your guess is probably just as good as "professionals". The key difference you need to have a discipline in money and risk management. Usually this means don't invest everything into one or just a few stocks. Diversify as much as you can to weather the storms. Also try to overcome your emotions of greed and fear. A good book I recommend is "High probability trading" by links.
My view on investing is people amd especially media try to oversell the important of "breaking news", and people flock to buy the stock if there is a good news, and sell the stock when the news is bad. You do not want to become a "news" trader, because when the news comes out the price action is already taken - the news is "priced in". you are already too late. Do not subscribe to any financial news and spend hours and hours looking for the latest news because there is always 10000 people ahead of you. Instead try to predict what is going to come out. My experience is there is no better way the using good old fashions chart pattern analysis. Strangely enough, news always come out in time to form and shape the chart so it fits the patterns. Sometimes even bad news gets interpreted as good news just so that price movement fits the pattern, so go figure. One website I recommend is www.screenulator.com it is non-profit unlike many other fancy looking stock sites, but has great number of chart patterns screened daily. You can also get free charts from www.stockcharts.com, and basic tutorial of chart analysis. You have to use your judgement though, they do not just tell you which stock to buy or sell, you need to know some chart pattern basics. It is literally a gold mine for me. I have made tens of thousands using trendline analysis category.
Click to expand...

That is reasonable advice with the exception of the techinical analysis BS
If one is going to invest, base it on the company,its value and its long term prospects for growth, not based upon what its chart looks like
 
If you're serious about making money, educate yourself first, then paper-trade/demo account for a year to familiarize yourself with the market dynamics.

What I recommend is that you start with this: http://www.tradersdvd.com/products/...-%2d-My-Way-8-DVDs-2006-with-a-Workbook-.html , then find whatever Steve Nison material you can get and master it.

JohnLarue said:
That is reasonable advice with the exception of the techinical analysis BS
If one is going to invest, base it on the company,its value and its long term prospects for growth, not based upon what its chart looks like
Click to expand...

Fundamental Analysis used to work well during the 50s and 60s when there weren't too much traders playing the stock market, it no longer applies today well. 2009 was an exception given that all stocks were oversold, and whatever you bought in March 2009 with good fundamentals, doubled by November. The 2008/2009 was similar to the 1974/1975, when Buffet made a killing.

I don't know if we'll ever have the trading opportunities we had last year, but I'll be better prepared should that happen again, for sure.

Good Luck !!!
 
torpedo30 said:
Learn technical and fundamental analysis methods on stock market and do your own research instead of giving your money to a fund manager or broker. Majority of mutual funds could not even beat market index for the last 50 years, your guess is probably just as good as "professionals". The key difference you need to have a discipline in money and risk management. Usually this means don't invest everything into one or just a few stocks. Diversify as much as you can to weather the storms. Also try to overcome your emotions of greed and fear. A good book I recommend is "High probability trading" by links.
My view on investing is people amd especially media try to oversell the important of "breaking news", and people flock to buy the stock if there is a good news, and sell the stock when the news is bad. You do not want to become a "news" trader, because when the news comes out the price action is already taken - the news is "priced in". you are already too late. Do not subscribe to any financial news and spend hours and hours looking for the latest news because there is always 10000 people ahead of you. Instead try to predict what is going to come out. My experience is there is no better way the using good old fashions chart pattern analysis. Strangely enough, news always come out in time to form and shape the chart so it fits the patterns. Sometimes even bad news gets interpreted as good news just so that price movement fits the pattern, so go figure. One website I recommend is www.screenulator.com it is non-profit unlike many other fancy looking stock sites, but has great number of chart patterns screened daily. You can also get free charts from www.stockcharts.com, and basic tutorial of chart analysis. You have to use your judgement though, they do not just tell you which stock to buy or sell, you need to know some chart pattern basics. It is literally a gold mine for me. I have made tens of thousands using trendline analysis category.
Click to expand...

You can read all the reports, do all the technicals and you could still lose, you have to develop your own gut feeling on where and what stocks to invest in knowing that the market is only ruled by two words "greed and fear". Usually you have to learn your lessons the hard way by losing before you can go ahead and start making money. There is nothing like panic when you see a stock you own going down the dumper and your capital droping like a stone. On the other hand if the stock is going the other way there is nothing like greed for not knowing when to cash out because you think its going up more. Think Nortel as a prime example. I've had friends who were millionaires but hung on to Notel as it kept dropping until they finally gave up and cashed out at a fraction of what it was at the height. As they say you can't lose by taking your profits.
 
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