Lessons from my 20,000% -Gaining stock – and other big winners

I have written many articles explaining how regular investments into stocks over time can build a huge portfolio. That’s all true, but a card showing money growth over time might look like just a math bunch, and it’s impersonal as well.

So let’s get a little personal. I want to talk about my own real investment, because I’ve been there for almost 25 years now – ever since I stumbled upon a new financial site called The Motley Fool (in the 1990s !). Here’s a look at my top three stock positions, how I’ve thought about them over the years, and how they serve me. I will outline some of the lessons these experiences have offered me – which may help you to do better in your own investment as well.

1. Apple

It is the newest of the three holdings Apple (NASDAQ: AAPL), which I bought into in 2008. I did so thinking I was probably late to the party, as the iPhone was introduced in 2007. The stock had gone from less at $ 0.50 per share (on a shared change basis) in 2004 to $ 7 prior to 2008, with Apple launching the iPod Nano, iPod Shuffle, iPod Touch, and iPhone. Shares fell sharply in 2008, however, partly because the entire market was in turmoil, as a result of the financial crisis of 2007 to 2009. I took advantage of Apple’s recession and bought my shares for a while. plus $ 3 apiece (split by split). (Articles by my colleagues Rick Munarriz and Tim Beyers helped convince me.) As I write this, Apple shares are trading for around $ 122 per head, showing a near 40- folded for me over an additional 12-years, or about 35% per year on average.

Yes, many others bought Apple before me and are sitting on far fatter products, but my gain still takes my breath away. It was a pretty mediocre thing I brought back in 2008, and I wish I had bought a lot more, but I still ended up with a valuable position. Over the years I have cut off some sections (as little as I could manage) to collect down payment for a home and for a few other necessities. My Apple stock has helped me reach financial goals today, and the remaining shares will help support me when I retire. Thank you, Apple!

Apple Lessons:

• Take advantage of market corrections and crashes to buy shares of companies you’d like to have – when they sell them.
• While it may seem like it’s too late to buy into a stock that has grown by leaps and bounds, if it’s really a long-term winner, it might be there is enough growth left.
• Big benefits will take several years to make. Major benefits may take even longer. You need to be patient and give time to companies that you believe are performing.
• Reading several ideas on interesting stocks can help you clarify your thinking and make you more aware of different companies – and their risks and opportunities. I have received a lot of large stock ideas from my colleagues’ articles.

2. Netflix

Netflix (NASDAQ: NFLX) another stock I thought I was late buying into. It had appeared through an initial public offering (IPO) in May 2002, and I had been seeing it for a long time with a lot of interest. Many of my Fool.com co-writers also complained about it – and some bought shares. Netflix had gone public with about 600,000 members, and in 2004, it surpassed the 2-million-member mark. It was growing fast, but I wasn’t 100% sure the future was yellow.

I took an even smaller position in Netflix than I did later with Apple. In fact, I invested no more than $ 1,000. But back in 2004, I got in at $ 2.50 per share. Today, the shares are trading around $ 535 apiece. That’s right – that’s my win over Netflix more than 200-fold – or about 38% per year on average. That’s crazy, right?

I no longer have all the shares, because I sold some to raise enough money to pay down on a home and for other needs – just like I did with my Apple stock and some of my other holdings . But I’ve hung a lot of sections, and I plan to do that for another decade or two. They seem to give me an income when I retire – and maybe a lot of it.

Netflix Lessons:

• Even if you only have a little to invest, it can still grow to a large amount when invested in the fastest growing stocks.
• It’s worth it to put some money in seemingly insignificant stocks that look worthless. Then maybe buy a few more in a few months or a year, if you still like them. You will settle, but you are less likely to regret it.
• If one of your holdings falls apart, think hard about whether you want to sell it. Netflix made a big blunder when it was about to split in half, and its shares received a big blow, while many investors cheered. But those who were hanged won a big prize.
• It may seem like you’re investing too late, but the best companies have decades of growth ahead of them.

3. Berkshire Hathaway

Now let’s get to Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), Warren Buffett Company. I wish I knew about Buffett and Berkshire much, much earlier, but at least I learned about it in time to start building some stock around 1998 and 1999. Parts cost Class B nearly $ 2,000 apiece back then, so I couldn’t buy much at once. (The shares split later, and today they are more affordable, at $ 251 recently. My cost base has changed with a split of nearly $ 40 per share.)

I love having Berkshire in my portfolio because I can count on being a sustainable grower. Many of my other holdings are smaller, stock that may be growing faster, but they are not all working out as hoped. Berkshire includes a lot of insurance and strong energy industries, along with other types of jobs that are likely to continue and grow over time, such as candy, furniture, and even total rail. My shares in Berkshire aren’t as skyrocketed as Apple and Netflix, but over 20 years, they’ve gone up more than sixfold, and now make up a big chunk of my portfolio. They help me sleep at night, too.

Berkshire Hathaway Lessons:

• You do not have to enter all your stock at once. You can buy in gradually, in bags.
• It’s good to balance a package with some slow and steady growers. Not all of your stocks should look the same.
• Stock price alone does not mean much. A $ 2,000 stock can double and triple for you, while a $ 10 stock can drop. You only need to try to buy when the stock is undervalued, or at least reasonably valued.

Caves

At this point, just in case you think I’m a genius investor, know I’m not. Over more than 20 years, I have done a lot of classical investment errors. I bought stocks without fully understanding what the company does. I bought stock that was overvalued, just to see them fall. I even bought the wrong company, because I got the ticker symbol wrong!

But making mistakes is inevitable. Even the best investors make mistakes, and some of the stocks they buy – with very good reasoning – fail. You can’t always pick the fastest growers. But if you read and learn a lot about companies before you buy into them – and about investing in stocks, in general – you are very likely to do well and your benefits will be far greater. than what you are missing out on. That’s what has happened to me: All my headbone movements have been balanced by my winners.

What stocks will fund your future?

Apple, Netflix, and Berkshire Hathaway have provided me with good service so far, and I expect that they will continue to do so. They may be good for you too, but they may not be able to grow as powerful in the future as they did before, because they are so big now. However, there are other huge growth stocks out there that could be awful for you.

Keep reading, learning, and researching, and a stock portfolio may be able to help you reach normal financial goals – and retire as well.