INVESTING MADE EASY

The key of making money in stocks is not to get scared out of them.

Peter Lynch

The hardest decision you can make is picking something to invest in, but this process can be simplified the more you invest.

Peter Lynch is one of the most iconic investors that simplified investing for average individuals, just by suggesting people to invest in the things they love and understand. Which begs the question why arent you investing in stocks today, and for those who are invested why arent you investing more.

Just start

Just to get this through your head, the hardest decision you can make is the decision to simply start investing. The more you procrastinate the more your missing out on passive returns, and the best way to learn how to invest is simply through experience.

So many entrepeuners will tell you the best way to learn a trade or a new skill is by trail and error (just hurry up and fail). The bigger the fail the better the outcome, remember after every failure ask yourself “why didn’t this work” or “what did I do wrong.” Asking these questions will help you over come the struggles of investing and come out a successful investor.

EQ

When your investing the second most difficult task is keeping your emotions in check. When I began investing the was a company that I had my eye on and I originally bought stock in this company was very innovative because of the their eco approach (how they helped the environment).

Well over the years I saw the stock go up and down, it was like a roller coaster ride. I couldn’t stomach the fact that I could loss everything so I got out.

That company was “Tesla”

If you believe in a company, all you need to do is to first study the background of the creator of the company. If I would of known that “Elon” first created “x.com” I would have realized that he was successful before Tesla.

Only knowing what you need to know helps build emotional intelligence.

Caleb Peters

So remember to hold on, no matter how risky the ride gets because your first decision is normally your best decision.

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The Way I Save

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The Importance of EPS

When it comes to choosing a stock EPS is the most important thing to look at before investing and in this post I’ll give you reasons why its important and I’m going to explain what EPS is.

Well for starters EPS stands for earnings per share.

WORTH

One of the main reasons why EPS is so important, is because EPS will let you know whether or not a stock is worth investing in.

A higher EPS shows investors that a company is profitable. When a company is profitable it’s more likely that the investor will receive dividend payments from the company.

DEMAND

When the “earnings per share” increases 25 percent, it also reflects a higher demand from the company. This can be because of the rising popularity of the company or an increasing need for the companies products.

For example, have you ever heard of “Zoom” before the pandemic. In 2020 the eps for Zoom was calculated at 0.27, in 2021 it went all the way up to 2.91, that’s over 25 percent.

CONSISTENT GROWTH

When the earnings per share for the company increases each quarter it represents future profitability for the company or consistent growth.

Before I purchase a stock I look at the estimated earnings per share and the actual earnings per share for each quarter. If a company passes its estimate earnings each quarter it shows The consistency of it’s performance.

Their are plenty of other reasons why EPS is important but these are the main reasons why you should pay attention to a company’s Earnings per share.

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THE WAY I SAVE

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How to Leverage your Money

I’m sure everybody’s heard of the saying buy low and sell high and that’s not just for the stock market that’s for every single thing you purchase. In this post I want to let you know about ways to leverage your money. I’m going to be sharing the ways that I personally have considered or successfully done myself.

BOOKS

So without further ado the first way to leverage money is with books. I have personally invested in several books like for example stock market 101, The intelligent investor, and the richest man in Babylon. With this investment of $57 in just these three books, I have made over a thousand dollars in 6 months.

This is just one example of how reading or listening to books can actually leverage your money. I am still utilizing the information used in these books today, which is also proof that it is a long term investment.

COURSES

When it comes to courses it is another way to leverage your money, but you have to be careful when it comes to choosing of course. I say this because there are courses that charge an arm and a leg for information that could’ve been provided somewhere else cheaper.

Also you have to be strategic when choosing a course what course can you take that can translate into more money for you. For me it was taking an accounting course to help increase my know-how of budgeting and maintaining my personal finances.

MENTORSHIP

Finding mentorship can be priceless and offered for a little to no cost, but there are people in places that charge you for their mentorship.

My advice is to start start with who you know and find people who invest their money in particular ways.

For me I have found plenty of mentors to draw near to who invest in real estate that are not only willing to share what they know, but are capable of partnering with me on deals.

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The Way I Save

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Goals For your Money

Many people create goals they want to accomplish at the beginning of each year. Some people accomplish these goals, others forget about the goals that they have set for themselves. The most successful people break down their goals into realistic task and give a time frame for the goal to be completed. If your new year resolution was to make more money this year, then you clicked on the best post for you.

In this post we’re going to break down your goal into making more money into realistic task but first lets be clear about the time frame. We want to complete this goal before the next year, so lets make this a 10 month goal.

TASK NUMBER 1

What are you passionate about and why? When you figure out what you are passionate about you will be willing to work more hours during the day. When you figure out why you are passionate about something it prevents you from getting burnt out or tired, and if you do get tired then its not a big enough “why.”

You don’t have to think too hard to realize what your passionate about because chances are you want to change peoples lives. So all you have to do is figure out what part of peoples lives you want to change. For example, I want to change the way people operate their personal finances so they can have financial freedom. The reason why I want to do this is because 80% of America is in debt and 55% of that debt is in credit cards.

So now that you know you want to impact peoples lives, and what part of their lives you want to impact, figure out how your going to impact them. Is it going to be through books, seminars, music, or a podcast.

TASK NUMBER 2

Supercharge your learning, when you find out what service your going to do, you need to learn more about the service (do not sell yourself short when it comes to the price of your service and do not overprice it.) You need to have a strategic method of learning too, so when you find the service you want to provide ask questions like how? Where? Why? and Who? Then learn the answers to each question. Start with the basics learn how to find the right people to partner with to eventually form a business, you need marketing, accounting, and specialist in the field.

TASK NUMBER 3

What ever money you have now, chances are your going to need more. So find things to flip, sell, or invest in that will give you enough cushion to start your business. I didn’t say it will be easy, but it is doable. Simple ideas to flip would be cars, shoes, or furniture.

I hope you enjoyed reading this post and I also hope it inspired you.

Thank you for reading

The Way I Save

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Why Diversify

There are plenty of reasons why you should diversify your investments, but in this post your going to be reading about the advantages of diversification.

Diversification is the practice of spreading your investments around.

ONE ADVANTAGE

The first advantage of diversification is when you diversify your stocks or money you are able to take advantage of growth opportunities in different sectors of the market.

You don’t have to know which stock to pick you just have to know which industry is going where. Once you figure that out, you can simply purchase a Mutual Fund, ETF, or Index Fund that is already diverse in that particular industry.

SECOND ADVANTAGE

The second advantage of diversification is that when you diversify your stocks or money it keeps you stable during tough times. With this pandemic, businesses are going under and investors that aren’t diversified are losing money.

Since I knew businesses are being affected during this pandemic, I invested in gold when the shutdown occurred which saved my investments.

When one sector goes down there is always another sector that is going to be prospering, you just have to diversify.

THIRD ADVANTAGE

The third advantage of diversification is knowledge. When one sector or industry is going down that’s your trigger into buying either one good business or one outstanding ETF in that struggling sector.

Now each time you log on your brokerage account, if your diversified enough, you should see where the market is headed. You can see which sector has gain momentum and where to put more money.

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THE WAY I SAVE

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HOW TO START ACQUIRING CAPITAL

You can acquire capital in multiple ways but in this post I’m going to be sharing what I do to acquire capital, and what my plan is to acquire more.

Well you can use gold, businesses, or you can acquire wealth through stocks like I do. I know that you can just let your 401k or your pension plan do the work for you, but the returns are much higher when you do the work yourself.

For example, my personal rate of return on my 401k for this year is 8.24 percent, while on the other hand my stock portfolio did a 21 percent return this year.

My goal for my finances or plan to acquire wealth is through borrowing from myself. Right now I am focus on stocks, but really I am building for the future.

After I acquire enough capital in my stock portfolio, I plan on taking an equity loan by putting a percentage of my stock portfolio up for colateral. The loan will be for purchasing investment properties, I truly believe that wealth starts by accumulating knowledge.

I took knowledge to the test by reading books, articles, and others forms of content on the stock market. After reading 5 to 8 books I finally started to see my return on investment.

THE MAIN POINT: “Everyone can start building wealth anywhere as long as they acquire knowledge first.”

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What is an ETF?

If you are a rather new to investing chances are you probably don’t know what an ETF is and what it can do for you. Well in this post I’m going to breakdown this acronym for you so that you will be able to see if investing in an ETF is right for you.

E – Exchange

ETF’s are a type of security that deals with a number of stocks in a specific index. Investing in an ETF helps diversify your portfolio just like a mutual Fund would. I currently hold an ETF called “JETS” in my portfolio to take advantage of the airlines that dropped during the pandemic. Since I don’t know which airline to purchase specifically, I choose to diversified through this ETF. Its always good to hedge or own each competitor in a struggling sector that has been through difficult times such as the airlines.

T – Traded

If you hold a mutual fund in your 401k you don’t have to pay taxes on it but if you own one outside your 401k or pension plan, you can be paying 15 percent in taxes. A good thing to know about ETF’s, is the fact that ETF’s cost less than Mutual funds because an ETF charges less in brokerage commission than buying individual stocks. Plus as long as you hold on to an ETF, you don’t have to pay a ton of taxes.

F – Fund

the reason an ETF is called an “Exchange Traded Fund” is because ETF’s are traded or exchanged on the stock market, just like any other stock or company.

Some of the biggest ETF’s are known as the NASDAQ, S&P 500, and Dow Jones.

Which are also referred to as index funds. Also, when an news anchor talks about the market he or she is referring to these three index funds or Exchange Traded Funds.

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OPTIONS OR STOCKS

Have you ever wondered if options are better then just holding stocks, well you came to the right place. Before we get to which one is better, let’s learn a little more about options and stocks. Then you will be able to see which one is better for yourself.

OPTIONS

If you want to know the big idea behind options it’s simple. Options are the right to a stock, pretty much a certificate of ownership. Calls and Puts are both classified as options, and can be used for when a stock goes up and down.

Call options

“Calls” are a type of option investors use to make profit for a stock to go up dramatically. Calls are known to make people very rich or loose a lot of money.

Put options

A “Put” is an option investors use in order to make money for a stock to crash and burn or simply go down. Just like Calls, Puts can be very lucrative if dramatic changes occur in your favor.

Cons

Options are super risky and can be addictive. Options are almost, if not equivalent to gambling. A lot of times you see investors promoting options because of the high reward, but they don’t present the fact that they have to pay a large some of money in taxes after those earning. Usually taxes for short term gains are between 15 to 24 percent

STOCKS

Stocks are simply publicly traded companies open for investors. The symbols on the stock market or abbreviation for each company is called the ticker symbol.

Compound Interest

Have you ever heard slow and steady wins the race, this can relate to investing as well. Unlike options, when you hold stock in a company you have the opportunity to take advantage of compounding interest. Companies like Disney or Bank of America, hand out a dividend for their shareholders. When you as an investor reinvest the dividends back into those companies your generating compound interest.

Capital

As you gain a large sum of capital or money over the years in shares, your also able to borrow from yourself by putting your shares up as collateral. Loans can be used as a tax benefit for you but don’t go crazy, you won’t really need to take loans against yourself to avoid paying taxes since you only pay taxes on dividends or when you sell a stock.

Also the only reason you would have to sell a stock is if the P/E ratio has gone over 15 and estimated earning have far exceed actual earnings for a few fiscal quarters, these results usually happen when there are changes occurring in head leadership so beware.

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What’s an IPO?

IPOs are always being listed on the exchange and you can make a considerable amount of money from buying and selling IPOs at the right time, but what are they specifically. Well in this post I am going to break down this acronym, and tell you whether or not you should invest in an IPO.

I – INITIAL

Well let’s begin with the first letter of IPO, which stands for initial. When a private company is planning to grow rather quickly, they look for funding in various places. Take “Publix” for an example, they offer their own employees an opportunity to buy a share of a company. With that money reinvested in Publix the company is able to acquire more assets to grow in profitability.

P – PUBLIC

The “P” in IPO stands for public. After massive expansion, a company like Publix is able to go public with their stock. This means a non-employee of Publix can become a shareholder in the company now.

O – OFFERING

I stands for Initial, P was for Public, and O is for Offering. As an Initial Public Offering, a private company is able to become a public company. The benefits of this transitions helps the company go from a couple hundred thousand in funding, to millions or even billions in funding.

BUT…

When a company is newly listed the information of its business dealings are very slim to none. Which means many investors do not know much about the company’s Assets, Liability, and the companies performance record (profits).

Even with knowing very little about a newly listed company, investors still gamble and invest in IPO’s. Which result in these investors loosing everything.

So taken it from Benjamin Graham when he states that the more you know the better with stocks; this is my translation of what Ben teaches in his book “The Intelligent Investor.”

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HOW TO PICK A STOCK

If your like me a few years ago, you probably want to invest into the stock market but you don’t even know what to buy. Well, you clicked on the right post, in this post your going to learn how to pick the best stocks and be able to determine what a good stock looks like.

Okay for starters, there are plenty of ways to make money in the stock market, But the best way is by holding on to a stock for five or fifteen years. There are two reasons why this is the best method.

  1. You can build capital
  2. You can receive dividends

CAPITAL

Now to build capital you have to do some research before you pick a stock. You cant just pick a stock based on what you think, or what some else thinks (that is a good way to lose your shirt.)

There is a cool site that helps you gather information about a stock and its called “SEC.GOV.” This website was created by the “U.S Securities and Exchange Commission” to help the individual investor make informed decisions on a stock before investing. Every stock that is listed on the market has to give updated information on the companies balance sheet, income statement, and cashflow statement, plus any executive decision.

I personally use sec.gov every quarter, to get updated information on how my stocks are doing. I suggest you to do the same, because this is a good way to learn more about the company and where its headed financially. You deserve to know if the company is making money or losing money.

DIVIDENDS

Part of deciding whether a stock is good, is by seeing if the stock gives quarterly dividends and has been doing so for more than fives years. This is another piece of information that is provided at sec.gov.

At the bottom of the picture above it shows the dividends per share for this particular stock. It also shows you how much dividends was handed out by the company in 2019 after three months and 2018 after three months.

Dividends gets passed out each fiscal quarter, which is every three months. At the bottom left you can see the dividends given after nine months for 2019 and 2018. I showed you this picture just to give you an idea of what your looking for in a stock, when it comes to dividends.

Just to give you a heads up, the reason why you want to pick a stock that shows more than 5 years of dividend payments, is because the company decides whether or not to give its shareholders dividends.

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