My wife joked with me that I ONLY got talktive and excited when talking about the stocks. I know that is largely true, and that was the case with yesterday evening’s gathering with my old friends. The good thing is unlike my wife, my friends are also interested in stocks.
For me, it is always interesting to learn some of the success stories and mistakes from others. But I still believe I learned most from my own mistakes: mistakes I made in the past, and continue to make now. Of course it would be better if we could learn from other mistakes, because the mistakes in stock investing or trading could be costly 🙁
If I could give my friends one piece of advice on stocks, that’s not going to be a stock pick, a good book, or where the market will go (will Shanghai composites test 4,500 before going up again?).
The most important thing in investing, is peace of mind. I remember Buffett once said he will NOT sacrifice one night good sleep for potential profit from a speculative stock. I know in real life, we (ordinary small investors) want to make fast money. But as an old Chinese saying goes, 欲速则不达 in English, “haste makes waste” (Thanks Shanzhi for correcting this). In Golf, I remember my instructor once said: grip the club with 50 to 60% of power, don’t try to hold or hit it too hard.
Because if you try too hard, you will likely hit the golf ball to a pond or a ditch. I think same rule apply to investing. In the past I have bet on earning report, or IPOs day trading, but I never made any serious money. From last thanksgiving, I started doing homework and taking a longer term view on stocks such as HMIN, EDU, MR and CROX. I still lost money from time to time, including the heart breaking mistake on CROX, but the most important of all, I believe I am still beating S&P 500 index for the year (my benchmark).
Just for fun, to commerate the one year anniversary of investing in Mindray(NYSE:MR), I listed my trades here. I started buying on the Black Friday (the day after Thanksgiving) of last year.
#Shares Price Commission
MR Mindray Medical International… Buy Nov 28, 2006 111.00 22.92 7.00
MR Mindray Medical International… Buy Feb 27, 2007 40.00 25.02 7.00
MR Mindray Medical International… Buy Apr 26, 2007 76.00 23.24 7.00
MR Mindray Medical International… Sell May 14, 2007 40.00 24.99 7.00
MR Mindray Medical International… Sell May 22, 2007 76.00 28.87 7.00
MR Mindray Medical International… Buy Jul 5, 2007 49.00 31.68 7.00
MR Mindray Medical International… Buy Jul 18, 2007 40.00 29.75 7.00