Dow closes out the worst first quarter in history (March 31, 2020). US stocks dropped sharply in the first three months of the year as worries about the global coronavirus pandemic and its impact on businesses and the economy grew.
I should start by saying that I am not a financial advisor. But, it is challenging to ignore the fact that the stock market has plummeted. For the past few weeks, my daily morning routine starts with checking in the stock market. Part of me enjoyed the engaging moment of being in this historic moment. Still, another part of me was sad that I might need to survive something more significant than a financial crisis. I recalled graduating back in 2009 when it was difficult to land a professional job. Instead of working, I went back to school to complete my chartered accountancy qualification. After working for almost a decade, it is unfortunate that I end up at this point. But as the saying goes, when life gets tough, the tough get going.
As I sat down drinking my first cup of coffee, I asked myself if I should take this opportunity and get my feet wet in the stock market and call myself a part-time trader. My gut says that this is the perfect time to enter the market, and if I am lucky, I may be able to come out of the market and make a few thousand bucks. That seems like a legit idea. Well, I hope things are as easy as that, and money can grow on trees, but the truth is there is always a framework for everything.
Based on my research, I find the following to be helpful and provide more clarity for my journey in the stock market.
1) Establish personal goals – XX% gain or $$ amount
2) Establish risk tolerance – Always invest money that you are willing to lose
3) Know your metrics – even the basic ones such as price to earnings, asset position, liquidity, etc
4) Read the news – make this a habit
5) Establish a stable stock portfolio goal – diversify to minimize risk
Stocks that I have selected are as below:
1) Mastercard. – Payment Network Services
2) Visa – Payment Network Services
3) Dexcom – Healthcare Diabetic
4) Baba – Ecommerce
5) Tesla – EV Vehicle
6) Carnival – Cruise
7) Amazon – Ecommerce
8) Facebook – Social Media / Advertising
9) Boeing – Aviation
10) Google – Technology
11) Berkshire B – Insurance
12) Apple – Technology
13) Starbux – Consumer
14) Delta – Airline
15) Mariott – Hotel
16) Uber – Ride Sharing
17) Illumina – Healthcare Genetic
I selected 17 stocks to diversify the portfolio based on industry. Diversification is beneficial to minimize risks for unfavorable events in the future. When considering stocks to purchase, I favor more on disruptive companies. Companies such as Google that changed the search engine and Tesla that brought the success of electric vehicles into the automotive sector. I use the Robinhood application to purchase all the stocks above. I plan to continue building a position for the stocks above and keep on learning the charts, indicators, and trends. It is a learning curve for sure, but secretly I hope to see a handsome return by the end of the year.
Stay at home and be safe!