As of yesterday (29 October 2013), my stock portfolio’s paper profit exceeds RM 1000 for the first time. This is a big milestone to hit for me as a beginner.
How it gets started
It was on 4 February 2013, about 8 months and 24 days ago, that I opened my first local stock trading account at Cimb with assistant from my brother. I only started to transfer money to the trading account in May (3 months later) to buy my first Malaysian stocks of PPB which was recommended by my brother.
At that time, I had no idea how the stock market works and how to evaluate companies. However, with advices and sharing from my brother and colleagues, I began to grasp some of the basic and fundamentals of the functioning of the stock market.
I found the list of companies recommended by “Cold Eye” (Malaysia’s Warren Buffett, as my colleague calls him) and bought some of the companies from the list. Within one month, I received a handsome dividend of RM 151.97 (considering the small amount of money I invested in the company). I started to get serious about stock investment.
Since then, I have finished about a dozen of stock investment related books. You can see the list of books that I read here.
During this period, I witnessed several events that caused big movements in stock market (I am referring to KLSE, Malaysian market). Firstly, there was the general election in May, then there was the withdrawal of foreign investments in August and lately the 2014 budget announcement on 25 October 2013. All these had created tremendous opportunities to get into the market.
Actually, this is not my first experience to invest in stocks. The first stock that I bought was a technological stock (a big mistake), Yahoo!. I bought it during my university year dating back to 2007-8 when I was still a student in France. The high cost to invest (paid €200 to get only €100 of stocks) and the bad performance of Yahoo! during that period had made me to avoid stock investment for good.
However, the situation in Malaysia is different, the cost is extremely low (RM 12 or 0.42 % per transaction) and having a good start with promising results, I need to rethink about my prejudice against stock investments.
My current philosophy of investing is to invest in good companies (with good fundamentals) that provide above average dividend yield consistently year after year. This looks simple and boring but I will talk more on this in my future posts.
My dream is that I can depend on the dividend income to achieve financial independence one day. With that goal in mind, I will start recording my journey along the road in this blog.
P.S.: Today, I opened a Hong Leong account so that I could trade stock with even lower fee (RM 8 or 0.1 %). 🙂