Good Bye I-Bonds, Hello Stocks!
So, after toying with the idea for at least a year, I finally redeemed my remaining I-Bonds earlier this week (around $750 worth) to use the money to fund investments on the stock market.
As such, I opened up a ShareBuilder account since it’s pseudo linked to ING (where I have my savings account).
Now, I know, CapitalOne is about to swallow them both up and re-brand (which I think sucks) but it still seemed like the most appropriate option for me.
So, to sidestep some of their higher fees, I’m abiding by their rules and only investing on Tuesdays.
Sadly, my “cash” deposit didn’t arrive in time to pick up my first group of stocks today so I’ll have to wait until December 11.
No biggie.
More time to research.
I say that, but I’ve made up my mind pretty much already.
Now I know we’re coming up fast on this fiscal cliff and that the bottom could virtually fall out from under me in less than 30 days but you have to start somewhere.
I’m not worried, things always recover. Always.
So, I sold off the I-Bonds partially because the TreasuryDirect.gov website is such a hassle but mostly because I believe that, even with the risk of losing money every now and then, I can “earn” more than $2 per month with a $750 investment.
When I was in the fourth grade (1986), our school had one of those Junior Achievement “Stock Market” games where we were all given some imaginary money and had to pick some stocks and then track/trade them for a couple of months.
This was back before the internet and CNBC so we were all walking around with the business section of the newspaper and lots of graphing paper. Pretty funny mental image…
I mean, do you think 4th graders even know what graphing paper is?
That there’s a Business section?
Or even what a newspaper is?
Anyway, everyday the newspaper listed the NYSE, NASDAQ, and American Stock Exchange. I’m pretty sure newspapers don’t even bother with that anymore — it sure filled up a bunch of pages, though…
Most kids went after cool companies (at the time) like Nike, Coca-Cola, or one of the insurance companies pretty much every one of our parents worked for.
Me?
Well, I wasn’t going to bother with the NYSE or American Stock Exchange cause the print was too small and the font was, well, lame. The Nasdaq listings were larger, had fewer fractions, and, well, they were on their own separate page that, when forced to share the business section with classmates, I’d get it to myself.
The primary stock I picked was ItoYokd.
(I also bought Reebok which was the anti-Nike and was just becoming popular…)
No clue what they do (or did — they’re not listed anymore). In reality, I just though the name ItoYokd looked cool and the price was right.
I won handily riding that stock. Like, quadrupled my initial investment in short time.
It was truly a shame that it was only pretend money.
On occasion, through high school, I’d check up on ItoYokd and kick myself again and again (and then again) wishing the “game” had been real.
Anyway, I’m grown up now (can you believe I’m 36 already?) and have $750 worth of “play” money.
I know hindsight is 20/20, but there are so many sure thing companies that I would have invested in… early.
Google’s one, for sure. I mean, who didn’t see that coming?
I abandoned Yahoo permanently the day I found Google. I switched to Chrome when it was still beta. And I’ve spent countless hours mindlessly looking at satellite photos of places I used to live on Google Earth. Why the hell didn’t I buy in?
It’s a bit late now, obviously, but I knew. Amazon is another perfect example. Who didn’t see that coming?
They’re modern day ItoYokds.
Except that I know (and like) what they do.
So what companies will be part of my initial investment?
Well, here they are:
F – Ford Motor Company : $11.31
I said it years ago and I should’ve put my money where my mouth was. I don’t own a Ford and I don’t really want a Ford, either.
Not to the point that I’d put one of those Calvin-pissing-on-a-Chevy stickers on my car or anything but I love that they didn’t need a bail-out, that they use Mike Rowe as a spokesperson, and that they make cars that don’t look like everything else on the road.
Their designs of late have been, well, progressive. Do I think mood lighting and a radio that you talk to are stupid and ridiculous (in that order)? Yes, I do.
But I give them credit for doing something new — something most car companies have been too chicken to even consider.
Toyota has sorta done it with their Scion line (of which I own one) but Ford did it with their flagship brand. Balls.
Hat tip to Hyundai and Kia for doing the same thing — I’d buy in to them too, but they’re both actually still private companies.
Anyway, with Ford on solid ground and now the sudden resurrection of the Lincoln brand, well, they’re a sure thing in my eyes. They pay quarterly dividends too which, I’m sorry, is extra cool.
FB – Facebook : $27.46
A botched IPO, major sell-offs, and tons of bad business press can’t sway me.
While not a social media whore, I visit Facebook first thing in the morning and last thing at night. Every single day. My soon-to-be 65 year old mother does the same. And apparently millions of other people do it too.
The price is right on this one and without a viable competitor in sight (MySpace, what? GooglePlus, who?), it’ll be darn near impossible to overtake them at this point.
As Google is to search and Amazon is to retail, Facebook is to, well, personal web pages and a lot of face/screen time. The ad revenue will only increase as they improve “monetizing” it all and they’ll be up there in the stratosphere with Google and Apple in a few years time…
GOOG – Google : $691.03
Yes, it’s expensive.
And yes, it’s *way* too late to jump on board with dollar signs in your eyes but behind Facebook, this is the site that I spend the most time on.
With an operating system now, being the leader in the browser war, and their own tablet (which will be under our tree this Christmas), they’ve diversified enough so that they’re not going to get overtaken and discarded like Yahoo did.
So while it probably won’t go way up in a hurry ever again, I’m pretty certain it won’t fall much either.
AAPL – Apple : $575.85
Always have, always will.
I do have to give them credit where credit is due though. Somehow they’ve turned their millions customers into mindless drones that keep coming back for more. Repeatedly.
I mean, how much of a difference is there between the iPod, the iPhone, the iPad, and the iPad mini? The overlap is tremendous (in name, even) but countless folks own all four devices, upgrade them regularly (at a premium), and can’t stop buying apps and music for them. Cha-ching!
Those Samsung commercials poking fun at Apple fanatics are spot on but, really, a company that regularly needs security and a velvet rope outside of all of their stores is clearly doing something right.
While their ship has long since sailed (rapid growth wise), like Google, I still want a slice.
DNKN – Dunkin Brands Group : $31.18
I don’t really like coffee and donuts are far too expensive these days but I did name my first born Duncan. That’s gotta count for something.
This goes along the same vein as Apple — Dunkin Donuts customers are by-and-large addicts. Loyal addicts.
That, and here in the northeast, they’ve sustained competing entries from Starbucks, Krispy Kreme, and Tim Hortons without skipping a beat. If anything, they’ve grown in popularity. Krispy Kreme and Tim Hortons have even withdrawn from the market.
And with New Englanders frequently moving/retiring to parts of the country with a better climate, the Dunkin empire is primed to expand…
THI – Tim Hortons : $45.70
So while Dunkin Donuts may have a stonghold in the Northeast, they’ve got nothing once you cross the border into Canada.
That’s Tim Horton territory — coast to coast.
With an ever growing population in Canada (mostly due to open immigration) and essentially zero competition in the donut/coffee business, they’re a mainstay north of the border. An icon, even.
Rhode Island and Massachusetts may have a Dunkin Donuts around every corner — big whoop. The second largest country in the world has a Tim Hortons on every corner.
Now, as I said earlier, they tried and failed to enter the market in my neck of the woods but they’re slowly but surely making their presence known in the United States and that’s promising.
Better yet, there are an awful lot of Canadians around (we blend in really well pretty much everywhere in the world) and we’re full of national pride and very loyal to our brands. Hmm…that pretty much sums up why I want it in my portfolio.
LULU – Lululemon Athletica : $70.64
Never heard of them? Well, just wait…
I’d never heard of them either until two years ago when I noticed that my trendy cousin’s entire wardrobe, head-to-toe (and extra comfy looking), was apparently made by the same company.
Since then, I’ve heard their silly named tossed around in high places in the Unites States now-and-then so, while the stock price is kinda high (in my guesstimation), it’s just the tip of the iceberg for them.
Soon it’ll be as fashionable here in the States as it’s been for a few years now in Canada.
Yeah, it’s another national pride selection for me.
Basically, they make yoga clothes. Overpriced and apparently high-end yoga clothes.
I know, I know, so *not* my thing but they’ve almost become more of a “Lifestyle” brand like that overpriced “Life is Good” line that you see so much of.
Their logo is a status symbol. Just wait. They’ll be huge in the US soon.
What do all of these companies have in common?
Mmm… wheels, websites, donuts, and hot bendy chicks in tight pants…
No, actually, they all have a great product and a loyal following.
Sure, gambling on bioscience and pharmaceutical companies could be more exciting and promising but I’m more looking to transition from a sure thing gainer (the I-Bonds) to an even better sure thing gainer that produces healthy returns.
Actually, I’m not looking to gamble so much… I’m looking to win.
This time it’s not pretend.
