I studied economics and have been reading economics, and studying it for many years. I have also been learning and studying investors and also investing myself. Here are the main things I’ve learnt.
Best books that I have learnt the most from.
Richest man in Babylon – timeless principles about investing
The intelligent investor – learn from Warren Buffet’s teacher
The millionaire next door – how do most wealthy people actually build wealth?
Think and Grow Rich – your mindset is one of the most important things in becoming wealthy
I also recommend searching on Youtube for videos and buying other related books by these guys:
- Tai Lopez – great for learning about social media / self promotion and buying internet businesses
- Warren Buffet – understand value investing
- Grant Cardone
- Gary Vaynerchuk – on social media and marketing
- Russel Brunson – nice podcast
Important topics to understand:
- What is the difference between trading and investing?
- How should you spread your risk?
- What are your expectations?
- How do the wealthiest people manage their money?
Here are some of my thoughts on investing:
- There is a huge difference between trading and investing. Many people are trading on a short term basis and looking at graphs and there is an advantage in investing in the long term. 10 years + and never selling it. It’s really hard to beat the traders, and as I’m spending little time investing then it’s better to think long term. Then you’re playing a totally different game.
- The market totally overreacts, its either too bad or too good, the truth is somewhere in the middle.
- The market overreacts in the short term, and under reacts in the long term. It can be a good idea to invest after bad news.
- There is a difference between price and value. If a mad man knocks on your house everyday asking to buy your car for different amounts, does it change the value of the house? Thats what the stock market is.
- Read a lot of annual reports about companies and their competitors to understand the industry (Warren Buffet spends all his time reading)
- Before checking the stock price, it’s really worth reading the annual reports of companies and then calculating what do you think the value of the whole company is? And if you were a billionnaire, what would you pay to buy the whole company? Ie. how would you value the company if you were buying it? And then check out what the company is valued at (and how much individual stocks are worth) to see if it’s worth investing in or not and what price it is worth buying shares at. (Warren Buffet).
- I like to make a journal of each investment, and explain why I make that investment, what my thesis is, and what my expected future price is. In that way I can go back to look at it to learn from it and see if my thinking was right or wrong.
- Stocks go up and go down, it’s a good idea to invest regularly, for example, each month. The monthly fluctuations matter less.
Where to invest?
- It’s best to invest in companies that you know and understand well and use. Then you have an advantage compared to the average investor who is trading on a short term basis and spending more time on graphs. As a customer you have unique information that the company might not even know and investors are unlikely to know, or at least there will be a time lag before they know it.
- The USD is a reserve currency, it’s wise to invest in alternatives in case it isn’t the reserve, or crashes at some point.
- I expect the current banking system will be totally changed in my lifetime, and so I think it’s worth investing in alternatives / financial related companies.
- I think its good to spread investments over: 40% Property, 30% Stocks, 10% Gold, and 10% Cryptocurrencies, 10% Cash.
- Property is the safest place to put money. I like technology stocks and especially platforms, and those that I use myself and that I think are good platforms as a consumer that I think typical investors don’t understand as well as I do. I really understand platform businesses because of my experience at China Admissions.
- I like to buy stocks without the intention of ever selling them.
My Youtube Channel
I will also be sharing more about my experiences investing on my Youtube channel. You can check it out here
