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First, a Little Background... (Scroll down for portfolio)
How do you get rich without starting rich? What if you only had a grand or two to spare and wanted to turn it into
millions in as short of a period of time as possible. What would you do? What could you do?
There’s hard work and dedication. There’s lottery tickets. Neither of these options appeals to me for a variety of
reasons. I have already done (and am doing) the hard work thing, and I can’t emotionally deal with the bi-weekly
soul-crushing experience of looking up losing lottery numbers in the A.M. (you know what I mean). There has to be
something that has the respect of hard work, but is a lot closer to the lottery ticket side of the spectrum…
So I was talking on the phone a few days ago with my brother about the Stock Market and how difficult it was for a
starting investor to pick the right stuff to invest in, especially those starting out with limited income and no access
to a trust fund or “daddy’s broker friend”. Predicting the outcome of the market with our limited experience
seemed like an intractable problem. Not only do you deal with random fluctuations, but you need to deal with
news, try to sense the patterns in politics, economics, technology, and the everyday fickleness of thousands if not
millions of other people. And, man, look what happens to a stock when it doesn't meet earnings projections or a
company comes up with a breakthrough technology? There are so many variables, how does a less-than-omnipotent
being turn lead into gold, so to speak?
Maybe our problem is over-thinking. Maybe the solution is to think on such a pure level that no amount of
information, good or bad, is going to detract you from what you feel is right or wrong. To strip away all that is
unimportant until you are left with only what is truly true – that’s the key. There is no way the average adult is
going to do this… too many distractions.
At that point Hunter, my (then) 5-year-old nephew, took interest in our conversation as he often does when my
brother and I are chatting on the phone. He started yelling out seemingly random letters of the alphabet “like his
father” (we were talking about stocks using ticker symbol laced jargon). As a joke, we put them into the computer
as ticker symbols just to see how they did that day.
Pretty well, it turns out. As a matter of fact, one of the stocks he picked (ZONS) went up 20%! Although he is a
smart kid, it is unlikely kindergarteners are reading at the WSJ level… Maybe it’s just luck, or maybe he can pick
stocks like Gary Coleman could pick horses in On the Right Track.
Let’s find out. But first, let's lay some ground rules:
- Hunter starts with $10,000 virtual dollars
- He is allowed to make trades only one day per week – on the weekend.
- Each trade costs him $10.
- Any amount of stock is allowed, as long as his portfolio has enough money to cover it – no margin trading.
- No taxes.
- For each stock, he will be asked if he wants to buy, sell, or hold. If he says “buy”, then he will be asked how
much should be spent on that stock (assuming he can cover it). If he says “sell” he will be asked if he wants
to sell “all” or “half”.
- He will maintain at least 5 stocks in his portfolio at all times. He will pick these using whatever method he
feels like using at the time (newspaper, yelling out stuff, Speak-and-Spell… whatever).
Hunter's Portfolio (Trading Stopped 020808)
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