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A look back at being a beginner

Public.com’s Non-Random Words

Investing Unscripted is presented by Public. Public.com has just launched its new high-yield cash account, offering an industry-leading 5.1% APY. 

No fees, no subscription, and no minimums or maximums. That means you can grow your cash with 5.1% interest with no strings attached—it’s as simple as that.

Again. That’s 5.1% interest, with no fees. 5.1% interest, with no subscription. 5.1% interest, with no minimums or maximums. 5.1% interest, with up to $5M FDIC insurance. Just 5.1% interest. Straight up. No strings attached.

A High-Yield Cash Account is a secondary brokerage account with Public Investing. Funds from this account are automatically deposited into partner banks where they earn a variable interest and are eligible for FDIC insurance. Neither Public Investing nor any of its affiliates is a bank. US only. Learn more athttps://public.com/disclosures/high-yield-account 

Jeff’s Random Words

On this week’s podcast, we had as our guests Andrew and Dave from the Investing for Beginners Podcast. As I mentioned on the show, Andrew and Dave’s podcast was one of the first ones I found when I was obsessively trying to learn everything I could about investing. It was a fun full-circle kind of moment to not only be guests on their show several weeks ago but to have them on Investing Unscripted this week.

Our conversation got me thinking about being a beginner investor. I remember my mindset back then and compare it to the kind of investor I am today. I’m sure some of those reading this are beginners, or perhaps close enough to being a beginner they can remember what it was like. Others may need to dig further back into their memories to recall that time in their life. Regardless, I wanted to share a few reflections as I look back a few years on my journey.

Learning by doing

I started small when I bought my first few stocks. And by small I mean penny stock small. I started with $50 and a brokerage that didn’t offer the ability to buy fractional shares. So, I was buying $4 and $5 stocks based on whatever lists and recommendations were on the brokerage app. This was the perfect way for me to start because it allowed me to learn by doing with comically low stakes. 

Checking your brokerage app

It’s often said that it’s bad to check your brokerage app frequently. I think this is wrong, at least for some or perhaps most people. If you’re the kind of person who can’t check without acting, then I can see the wisdom in checking less often. But for me, seeing the wild things that can happen on any trading day was important. For example, the first time I saw a stock rise or fall by double digits in one day surprised me. I was an index fund investor who was used to quarterly statements. 

The idea that a stock could rise or fall that much in one day was eye-opening. But then I saw that sometimes only a week or two later, that large move in the stock’s price would reverse itself. This taught me that big moves are part of the deal.

Always learning

Perhaps the most profound thing I remember about that time in my life was how much I was learning. Aided by the pandemic lockdowns, I read just about every book, article, and social media post I could about investing. While I’m still learning a lot now, it’s definitely a different kind of learning. Back then it was technical (what is a price to earnings multiple? How do I understand a balance sheet?) and today it’s more about mindset. 

This is an area I’d like to revisit. I think its easy for all of us to seek out new learning less as our experience level increases. I sometimes feel like I am substituting time as an investor for learning to be a better investor. I’m not one for New Year’s resolutions, but this is something I would like to focus on in the coming months.

I think what I am trying to say is that there’s some value in reflecting on whatever journey got us to today. The past is always filled with successes and failures, and each teaches their own lessons. But what matters is constant improvement. To be better investors tomorrow than we are today.

Jeff

Jason’s Random Words

We gave Jason this week off. From time to time you may only hear from one of us. It won’t be often, but we appreciate your understanding!

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