One of the best pieces of advice I ever got in a book came from J.D. Spooner’s Do You Want To Make Money Or Would You Rather Fool Around ?, Spooner pointed out that a big mistake many people make is not buying enough shares of a stock they like. They may do great research, pick a great stock, and buy at the right time, but they buy so few shares that what should have been a big winner turns into a nice but modest gain.
For example, they may buy 100 shares of XYZ corporation at $20 per share. If XYZ does really, really well it might be at $60 within a year. Our investor picked a great stock – up 200% in a year! And yet, our investor made $4000. Not really life changing.
View original post 754 more words
fine. But if the stock does not appreciate then ???
That’s why you buy a few different companies, plus keep the bulk of your investments in mutual funds.