(This is a guest post by Gutman, who has recently put together the greatest book on investing in stocks ever written (his words, haha…), and is offering it for free on his site right now)
Nobody really likes stocks. I mean, sure, they can make you quite a bit of money. Then again, they can just as easily lose it for you. They don’t listen to you half the time and researching them intently can oftentimes makes you want to punch a unicorn square in the jaw. And it’s certainly no secret that there are better, more fun, more profitable investments out there. And this is all coming from a guy who wrote a book about investing in stocks.
Let me share with you a few reasons why I rue the day I decided to invest in stocks.
- Stocks have no point. What are stocks really, other than a piece of paper saying that you own a piece of a giant, faceless corporation? What does this give me? Is it going to buy my imaginary wife a new dress? Will it teach my fictional son how to ride his bike? Will it put food on my theoretical table? Will they give me shelter during a hypothetical thunderstorm? Probably not.
- Stocks are boring. It’s no secret that to be able to make money with stocks (without risking losing it all) you should be prepared to do research. However, does anybody really want to come home from a hard day’s work and calculate a stock’s equity risk premium? Or study the competition’s 5 year free cash flow on invested capital trend? Personally, I’d rather spend my evenings running over pedestrians in Grand Theft Auto IV.
- Stocks will give you a heart attack . If you’ve ever invested in a stock then, chances are, you know what it’s like to have your heart ripped out of your chest and stomped on by an angry gorilla. One moment you will be giggling like a schoolgirl when you see you’ve earned yourself a few shekels. The next you’ll be weeping from seeing all your gains wiped out with the swift flick of the evil market wizard’s finger.
And now: why I’m a dirty stinking liar.
- Stocks have the most important purpose in the world. Sure, stocks may not babysit your pet leopard nor will they provide you with a place to store your rusty 1967 Ford Mustang. However, they will do something for you that a million trips to the supermarket (or whatever it is that you people do) never will: they make you money. Family, shmamily.Happiness, shmappiness. Money can buy me a million families and all the sacks of happiness that I can fit into my gold-plated minivan.
- Stocks are exhilarating. Say what you will about investing, but I love it. I love learning of how a company lives and breathes. I love to dig into it and understand what it’s doing and where it plans to go. I love studying its strengths, weaknesses and how it stands up against the competition. Most of all, I love to find a company’s hidden gem that nobody knows about yet. Something that makes it shine and prosper above all the rest. And once the rest of them realize just how amazing this company is, you’re already there, with a big grin on your face, laughing maniacally while twirling your mustache and singing ‘I told you so!’
- You will sleep sounder than a hibernating rhinoceros. You’ve bought stock of a company that is growing sales every year, is extremely profitable, has little-to-no debt and a ton of cash in the bank. To add to that, you bought it at a fraction of what it’s worth. Who cares if it drops a few percentage points here and or there, your stock is still worth more than what you bought it for! Remember that terrible stock market crisis back in 2008? Where all those people had to sell all of their worldly possessions so that they could pay the cable bill after losing so much money in the stock market? Well, if you had kept your money invested, you would have recouped all of your losses and actually made money since then (and a lot of it). You just have to have a little more foresight than a goldfish, which, sadly, it seems that the vast majority of people do not have.
And that is my bipolar recollection of why I love and hate stocks. There’s one final thing that I think needs to be said about stocks: it’s very easy to hate them. Why? Because people dislike what seems somewhat foreign to them.
Guest Post by Gutman. Who adds, “If you have even an inkling of interest in stocks or want to catch a whiff of why I love them so much, I’ve written a feature-length book on the subject. And it’s free (for now). So head over to my site and download it. You won’t regret it. Unless you absolutely despise sarcasm, humor or learning how to make money safely and profitably. What do you have to lose?”
(Photo by miss_millions)