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toby4059
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Currently a MIT undergraduate student, originally from Georgia. My passion is the technology and aviation sectors. I recently founded a tech company with some friends and I'm also a licensed private pilot. Read more about me in my blog.
My blog:
The Undergrad
  • The Beginnings  2 comments
    Jun 20, 2014 10:34 PM | about stocks: GE, BBDA, AIG, T, TOSYY

    So I've been trading since 10th grade, starting with a generous gift of $1000 my father gave me to buy stocks with. The idea was I would grow the money then subsequently use it to buy the gaming desktop of my dreams. It has undoubtedly been a long road of wins and losses, emphasis on the losses, especially early on in my trading journey.

    I came into the world of trading with the idea that I would be the next teenage self-made millionaire, starting from $1000 and making infinitely more money. This naive mindset led me to invest heavily in what I believed would bring me the highest returns: penny stocks. It seemed like the obvious choice at the time. Day after day I would see such a stock go up +2,000%, and I would think to myself that one day I would be lucky enough to hit the penny stock lottery. Penny stocks became almost irresistible to me. Unfortunately, I was only once able to make a single trade for a gain (maybe $20) during my time with penny stocks, and I ultimately lost much more. My favorite penny stock of that period of my life was Bebida Beverage Company (OTCPK:BBDA). They had a product that was the polar opposite of an energy drink, a relaxation drink. I fondly remember going on message boards where members would rant about how "Today IS the Day!!" meaning they believed the stock would go through the roof that day. Me, the naïve investor, believed every word as I purchased thousands of shares thinking I would finally strike it rich. That type of day would usually end with the stock posting mild gains, then tanking shortly there after. This was my first introduction to the pump and dump trade scheme.

    Penny stocks were not my only uneducated choice however. I also invested in At&t (NYSE:T), AIG (NYSE:AIG), Toshiba (OTCPK:TOSYY), and Nvidia (NASDAQ:NVDA) just on the whim that I really liked those companies. Needless to say, by the end of my first year I had lost around 20% of the initial funds I started with. Defeated and unsatisfied with my current positions, I went to my father and I asked that I be given permission to liquidate my portfolio and start over again. Seeing that I had learned something, he agreed and I was allowed to start afresh.

    Around this time my World History Teacher, Ms. Doran, caught me watching the markets in class instead of doing an assignment I had. She started to go off on me for being off task, but then started to talk to the class about investing and her own investments in particular. She told us about a stock she had been continually investing in for some time, and that paid an excellent dividend: General Electric (NYSE:GE). Side note, this was the first time I had even heard of the term dividend and heard an explanation of what they are. She immediately had me sold on the stock. I picked up 9 shares at around $19 each. From that point on, most, if not all of my investing was done in buying GE stock (I also hadn't learned of the idea of diversification). I had never seen solid gains in my year of investing and GE had me hooked. At the advice of my teacher, I quickly enrolled in a dividend reinvestment program meaning that my quarterly dividends would go toward buying more shares of GE. Suddenly, I found it much easier to get funding from dad now that he had watched as I was finally able to make money instead of constantly losing it. At the time of this writing I currently own 327.81349 shares of GE, with a gain of $970.73 or 12.33%.

    So that is was my trading journey from 2010 through early 2013, until I got to MIT. I'll write another post soon about late 2013 to present times soon.

    Thanks for reading!

    Disclosure: The author is long GE.

    Themes: GE Stocks: GE, BBDA, AIG, T, TOSYY
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  • Anyoption
    , contributor
    Comments (223) | Send Message
     
    It's always great to hear about how people get started--welcome to the instablogs!
    21 Jun, 03:38 PM Reply Like
  • toby4059
    , contributor
    Comments (5) | Send Message
     
    Author’s reply » Thank you!
    23 Jun, 03:56 PM Reply Like
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