Learning about Stocks & Shares

Username999

BananaRepublic said:

Username999 said:

BananaRepublic said:

 returning over 10% / year for the last five years, and some going back 20 years have done similarly well. 

Name one.
Shouldn't be difficult.

My Jupiter European has grown very well. I didn’t balance my investments which some say you should do. 

Which one, the one with min £5M initial deposit?

Thrugelmir

Cptralls said:

Hi All, 

I'm reasonably good with managing my finances (always room for improvement), however, I know little to nothing about S&S's. My 2021 resolution has been to learn about S&S's and I have a few weeks off work, where do I start? I'm also keen to dip my toe into the pool so I'm eager to know how to do this.

Any information and guidance would be gratefully received. 

If there was one book to read as an introduction I'd always suggest

Harriman's New Book of Investing Rules: The do’s and don’ts of the world’s best investors

When it comes to investing. There's more than one way to skin a cat. 

BrockStoker

Watch this Brockstoker, a naive investor who thinks his picks are above average

I can only go on my portfolio's performance up till now. If my picks are "above average" then the average investor in individual stocks must be poor at picking stocks (or impatient, or one of the other many flaws which cause investors to fail), and I'm sure most if not all here will agree that that probably is the case.

, so he must have an edge.

Perhaps I do, and perhaps I don't. What evidence do you have that I don't?

He hasn't, as time will tell, one to watch until he disappears.

Yes, time will tell, and if you think I'm going to disappear, I'll be more than happy to prove you wrong. I guess my track record, which includes posting when my portfolio was making a loss (at the "peak" of the crash last March - see my post here on 15 March: https://forums.moneysavingexpert.com/discussion/6083125/investing-in-biotech-stocks-my-experience-so-far/p5 ) makes you think I'll shy away at the slightest sign of adversity.

Seen so many like him in 40 years of investing

So in your "40 years" you've never come across/heard of a successful individual stock investor? Really?

Don't fool yourself. Just because you've seen others that have not cut the mustard, it does not mean everyone else who tries is automatically a failure.

, but he can't be told.

What, you mean like all the others who told me I could not possibly achieve my aims (to double my portfolio within 5-10 years)? And yet I have done so in much less time than that. I could cash out tomorrow, having got to my goal, but if I'd listened to all the nay sayers (who now look a bit foolish frankly), I would not be in the position I'm in now.

I'm confident in the stocks I've picked, and confident because I have done my DD, unlike so many investors who do not do proper DD. So you can sling mud all day long in the hope some will stick, but you have yet to post a single fact backing up what you are claiming, and to me it's like water off a duck's back. I'm not saying I don't listen - I do - but only if there is any substance/merit to what is being said.

All I've done is post facts, and my opinion based on those facts (what else can I do?). I acknowledge there is some bias (are you expecting me to NOT be confident in the stocks I've chosen to invest in?), but I have always tried my hardest to minimize this, and look at things objectively. I've never said that investing in individual stocks is for everyone, but how is anyone supposed to find out if it is (or not) if they don't try? At the end of the day I only advocate investing money in individual stocks which someone can afford to lose. So please, get off your high horse, and troll somewhere/someone (preferably the former) else.

BananaRepublic

BrockStoker said:

Watch this Brockstoker, a naive investor who thinks his picks are above average

I can only go on my portfolio's performance up till now. If my picks are "above average" then the average investor in individual stocks must be poor at picking stocks (or impatient, or one of the other many flaws which cause investors to fail), and I'm sure most if not all here will agree that that probably is the case.

, so he must have an edge.

Perhaps I do, and perhaps I don't. What evidence do you have that I don't?

He hasn't, as time will tell, one to watch until he disappears.

Yes, time will tell, and if you think I'm going to disappear, I'll be more than happy to prove you wrong. I guess my track record, which includes posting when my portfolio was making a loss (at the "peak" of the crash last March - see my post here on 15 March: https://forums.moneysavingexpert.com/discussion/6083125/investing-in-biotech-stocks-my-experience-so-far/p5 ) makes you think I'll shy away at the slightest sign of adversity.

Seen so many like him in 40 years of investing

So in your "40 years" you've never come across/heard of a successful individual stock investor? Really?

Don't fool yourself. Just because you've seen others that have not cut the mustard, it does not mean everyone else who tries is automatically a failure.

, but he can't be told.

What, you mean like all the others who told me I could not possibly achieve my aims (to double my portfolio within 5-10 years)? And yet I have done so in much less time than that. I could cash out tomorrow, having got to my goal, but if I'd listened to all the nay sayers (who now look a bit foolish frankly), I would not be in the position I'm in now.

I'm confident in the stocks I've picked, and confident because I have done my DD, unlike so many investors who do not do proper DD. So you can sling mud all day long in the hope some will stick, but you have yet to post a single fact backing up what you are claiming, and to me it's like water off a duck's back. I'm not saying I don't listen - I do - but only if there is any substance/merit to what is being said.

All I've done is post facts, and my opinion based on those facts (what else can I do?). I acknowledge there is some bias (are you expecting me to NOT be confident in the stocks I've chosen to invest in?), but I have always tried my hardest to minimize this, and look at things objectively. I've never said that investing in individual stocks is for everyone, but how is anyone supposed to find out if it is (or not) if they don't try? At the end of the day I only advocate investing money in individual stocks which someone can afford to lose. So please, get off your high horse, and troll somewhere/someone (preferably the former) else.

I’ve been critical of some of your posts, but good luck to you. Many well known investors have said that key to successful investing is temperament. “If you can keep your head while all around you are losing theirs”. As said earlier, there’s many ways to deprive a feline of its fur coat. 

BananaRepublic

Username999 said:

BananaRepublic said:

Username999 said:

BananaRepublic said:

 returning over 10% / year for the last five years, and some going back 20 years have done similarly well. 

Name one.
Shouldn't be difficult.

My Jupiter European has grown very well. I didn’t balance my investments which some say you should do. 

Which one, the one with min £5M initial deposit?

Jupiter European I Acc. Yes I think it is the one with an initial minimum deposit of £5,000,000. 

bowlhead99

BrockStoker said

Note: The last two portfolios (holding mostly biotech) were not invested "before covid", I didn't "happen" to pick those stocks, and I don't put it down to "some unique system" or my "intelligence", contrary to what another poster on this thread was trying to suggest previously (funny how when you are successful others try to rubbish you/make you look like you are some kind of a "fraud").

If you didn't just "happen" to pick those stocks, presumably you mean you went through some reasoned and diligent process to evaluate the stocks on offer, sort the wheat from the chaff and critically evaluate their prospects etc. While you can take what the other poster says to heart, or take it with a pinch of salt, I expect you applied some intelligence, time on your hands and a process of systematically sorting wheat from chaff.  If you're saying you did it without a system or intelligence, then perhaps the other poster is right to imply it was dumb luck - after all, you're investing in a sector where a great many investors can make surprising levels of gains through happy accident and good fortune with a scattergun approach

I do however believe that a good plan/strategy is important along with a good understanding of the companies/sector, and that anyone with a reasonable level of intelligence (as long as they have the right attitude to risk and are patient) is capable of successfully investing in individual stocks. I also have my own strategies to help minimize risks as much as possible, but at the end of the day I only invest money in individual stocks which I can afford to loose.

Your early strategy on that thread seemed to be to invest small amounts of money in a a whole load of companies to spread your ISA allowance and I think you had 19 companies in your first portfolio list for the ISA, spreading the risk around - and presumably picking those 19 involved reviewing another 40+ stocks in the sector to determine that they weren't as good as the ones you ended up with, so a lot of work to produce your concentrated portfolio. A fund specialising in the sector would probably have 50 holdings to diversify the risk while still weighting the holdings to capture the potential gains from the better prospects, but when we build our own portfolios with direct holdings we generally concentrate our convictions in a smaller number than 50 per sector of course.   

By the time we got to your latest update, you were down to only having 5 individual stocks, none of which had been in your original portfolio. Without revisiting all the 250+posts on the thread, as you added more money to the portfolio what was the main driver of changing your approach to having a large amount of money in a tiny set of companies instead of a broader set of companies with good prospects?  Just a strong belief that the 'money you can afford to lose' will give you the best potential upside if you gamble it on a couple of companies instead of twenty? Probably not best for the OP to try to emulate that.

I imagine for the OP just starting off looking at stocks and shares, a dabble in individual shares (especially with the 'support' offered by the wild west of the LSE and ADVFN boards mentioned in an early reply) is a bewildering and high risk thing to do, even if they can afford to lose what they invest. If as you say, you had a deep understanding of the companies and sector, a good plan/strategy, and 'strategies to minimize risk'  but still ended up having a wholesale change to the strategy over the course of the year - to go from being invested in 19 stocks to being invested in only 5 (and mostly, just 1), it seems like a newbie without a strategy should not try to follow in those footsteps.

Learning about stocks and shares for a few hundred pounds a pop is probably the way a lot of people started investing, and doing that does provide a bit of an education on how companies and markets work, so can be useful when only relatively small amounts of money are at stake (compared to eventual life savings & investments) and lessons can be learned from mistakes. Conventional wisdom would definitely point towards collective investment vehicles such as funds and investment trusts being a much more sensible way to do it of course, even if a bit less 'interesting'. 

BrockStoker

bowlhead99 said:

BrockStoker said

Note: The last two portfolios (holding mostly biotech) were not invested "before covid", I didn't "happen" to pick those stocks, and I don't put it down to "some unique system" or my "intelligence", contrary to what another poster on this thread was trying to suggest previously (funny how when you are successful others try to rubbish you/make you look like you are some kind of a "fraud").

If you didn't just "happen" to pick those stocks, presumably you mean you went through some reasoned and diligent process to evaluate the stocks on offer, sort the wheat from the chaff and critically evaluate their prospects etc. While you can take what the other poster says to heart, or take it with a pinch of salt, I expect you applied some intelligence, time on your hands and a process of systematically sorting wheat from chaff.  If you're saying you did it without a system or intelligence, then perhaps the other poster is right to imply it was dumb luck - after all, you're investing in a sector where a great many investors can make surprising levels of gains through happy accident and good fortune with a scattergun approach

I do however believe that a good plan/strategy is important along with a good understanding of the companies/sector, and that anyone with a reasonable level of intelligence (as long as they have the right attitude to risk and are patient) is capable of successfully investing in individual stocks. I also have my own strategies to help minimize risks as much as possible, but at the end of the day I only invest money in individual stocks which I can afford to loose.

Your early strategy on that thread seemed to be to invest small amounts of money in a a whole load of companies to spread your ISA allowance and I think you had 19 companies in your first portfolio list for the ISA, spreading the risk around - and presumably picking those 19 involved reviewing another 40+ stocks in the sector to determine that they weren't as good as the ones you ended up with, so a lot of work to produce your concentrated portfolio. A fund specialising in the sector would probably have 50 holdings to diversify the risk while still weighting the holdings to capture the potential gains from the better prospects, but when we build our own portfolios with direct holdings we generally concentrate our convictions in a smaller number than 50 per sector of course.   

By the time we got to your latest update, you were down to only having 5 individual stocks, none of which had been in your original portfolio. Without revisiting all the 250+posts on the thread, as you added more money to the portfolio what was the main driver of changing your approach to having a large amount of money in a tiny set of companies instead of a broader set of companies with good prospects?  Just a strong belief that the 'money you can afford to lose' will give you the best potential upside if you gamble it on a couple of companies instead of twenty? Probably not best for the OP to try to emulate that.

I imagine for the OP just starting off looking at stocks and shares, a dabble in individual shares (especially with the 'support' offered by the wild west of the LSE and ADVFN boards mentioned in an early reply) is a bewildering and high risk thing to do, even if they can afford to lose what they invest. If as you say, you had a deep understanding of the companies and sector, a good plan/strategy, and 'strategies to minimize risk'  but still ended up having a wholesale change to the strategy over the course of the year - to go from being invested in 19 stocks to being invested in only 5 (and mostly, just 1), it seems like a newbie without a strategy should not try to follow in those footsteps.

Learning about stocks and shares for a few hundred pounds a pop is probably the way a lot of people started investing, and doing that does provide a bit of an education on how companies and markets work, so can be useful when only relatively small amounts of money are at stake (compared to eventual life savings & investments) and lessons can be learned from mistakes. Conventional wisdom would definitely point towards collective investment vehicles such as funds and investment trusts being a much more sensible way to do it of course, even if a bit less 'interesting'. 

Bowlhead,

I agree with everything you've said there to some degree or other.

Keep in mind, when I first started (back in Nov 19) I was not 100% sure about what I was doing, and it was very much an experiment/punt to begin with. So my strategy then for finding stocks of interest (and my overall strategy) was a little bit "all over the place" to say the least.

Starting out with 19 or so stocks was a double edged sword I believe. It was a good thing in the sense that I got to know quite a few stocks in a relatively short space of time (albeit not as well as I would have got to know them if I'd only picked a few to concentrate on), but at the same time I believe I was spreading my money a bit too thinly, and the big percentage gainers did not produce significant monetary gains because of this. I'm sure some "dumb luck" must have been involved, but I think it's slightly unfair to say it was all dumb luck. While biotech is a high beta sector, and when I started the sector had been running up overall, I'm sure I could have easily picked some bad stocks and made significant loses.

You are right, I could have just invested in something like BIOG, and made similar gains, if not a bit more, but then it would not have been as much of a learning experience, which I've been grateful for.

So the main driver for me deciding to distill my portfolio down to just a handful of stocks (with one being massively overweight) was mostly due to my discovery of Arrowhead, as well as the realization that in order to have a good (or reasonable) chance of making life-changing gains, I would have to pile in to my best bets much more. I'm not sure I would advocate doing this to everyone to the degree I have, but in my case I firmly believe I have found a great company with almost unlimited potential: Arrowhead. I can't really expect anyone to fully understand why I've gone to this "extreme" without full understanding the science behind the company and the company itself, but I do believe it is a little like a Tesla or Apple in it's early stages, but with better/more disruptive tech and fantastic management that knows how to leverage the tech to it's best possible advantage. While there are still risks in doing this, I believe they are as minimized as they can possibly be with a company like this (or any company for that matter), so what began with a "punt" has "ended" with a punt, albeit with odds that I believe are massively skewed in my favor.

So I would definitely not advocate anyone following exactly in my footsteps, although I believe others may be able to learn lessons from my experiences, and perhaps formulate a plan/strategy which takes into account some of the things I've tried to highlight. I would also say that it would be hard to go wrong investing in Arrowhead at current prices with a long term view, but as always, prospective investors should do their DD, and invest in line with there tolerance to risk.

As you say, it's best to start off investing with smaller amounts until you know better what you are doing, and if you have the right aptitude for investing in individual stocks.

BananaRepublic

Username999 said:

BrockStoker said:

Yes. You only have to look at what share prices can do to see what is possible. Of course investing in individual shares is going to be riskier than investing in funds, but returns are potentially much better. Generally speaking, the more risk you take, the greater the potential returns. Conversely if you get it wrong, there is the potential to loose a large part of your initial investment, and perhaps even all of it if you are very unlucky, but as long as you are not totally foolish I think this is unlikely.

I'm relatively new to investing in individual stocks (I first invested a year ago last Nov), although I have spent years getting to know my preferred sector (healthcare/biotech) and companies within it, and I think I've done OK so far.

I currently have 3 portfolios which I manage:

Combined ISA/SIPP portfolio (2 stocks currently) started in Nov 19 with £40K - current value is ~£87.9K (about 110% gain in around 15 months, although technically it's much less since 15 months is only the time of my first buy)

Mrs Brock's ISA portfolio (3 stocks) started around 10 Oct 20 with £15K - current value is ~ £26.8K (about 86% gain in just over 3 months)

My unwrapped share dealing portfolio (1 stock) started around 10 Oct 20 with £3.2K - current value is ~£5.2K (about 63% gain in just over 3 months)

Note: The last two portfolios (holding mostly biotech) were not invested "before covid", I didn't "happen" to pick those stocks, and I don't put it down to "some unique system" or my "intelligence", contrary to what another poster on this thread was trying to suggest previously (funny how when you are successful others try to rubbish you/make you look like you are some kind of a "fraud").

I do however believe that a good plan/strategy is important along with a good understanding of the companies/sector, and that anyone with a reasonable level of intelligence (as long as they have the right attitude to risk and are patient) is capable of successfully investing in individual stocks. I also have my own strategies to help minimize risks as much as possible, but at the end of the day I only invest money in individual stocks which I can afford to loose.

If you want to read more about my own portfolios/strategy I have a (long) thread about it here:

https://forums.moneysavingexpert.com/discussion/6083125/investing-in-biotech-stocks-my-experience-so-far

Watch this Brockstoker, a naive investor who thinks his picks are above average, so he must have an edge.
He hasn't, as time will tell, one to watch until he disappears.
Seen so many like him in 40 years of investing, but he can't be told.

So, we’re all dying to know how your investments have done and the secret of your success. Please do tell. 

mrlegend123

@username999.
yes, what is your portfolio and strategy? 

Steveg6

I have only just started my journey in the stock market (  using trading212 ) , so far so good. However I was wondering if anyone can clarify the situation regarding capital gains and when one has to pay it. I understand that we have an annual allowance of £12.3k , so no worries there.  My understanding is that you only pay the capital gains ( assuming you have exceeded the threshold ) once you actually realise the gains and that gain/profit is transferred back into your bank account. 
If i then sell my shares but i dont actually withdraw my money back to my account, i just leave the money/gains form the sale of those shares in my trading account and dont actually withdraw it ( so for example i decide to reinvest into other stocks ) , do i still need to pay capital gains on this or is it only once i have received the money back to my account ?