Let me start off by saying this. I know absolutely nothing about the stock market. My background is motoring journalism, which means I’m far more comfortable rattling off power figures and 0-100 km/h times than I am debating the merits of this week’s hottest stock. But I’ve been at BizNews for three months now, and for me to say I’ve learned nothing would be to lie. You’re bound to pick something up, especially when you work for financial fundis like BizNews founder Alec Hogg.
I’ve always been intrigued by the stock market and those who work in finance. The idea of donning a fine suit, barking orders down the receiver of a carphone while piloting a large Mercedes-Benz would always appeal to a naive 14-year old wanting to make it big someday.
Now that I’m older and (a little bit) wiser, I realise that the image I had of a financier was one conjured up by Hollywood. Nonetheless, it was an intimidating field for a novice to explore. Concerned I’d be eaten and spat out quicker than a tepid appetiser at a disorganised wedding, I decided to leave my finances with a professional and get on with being a journalist.
With the crumb of financial knowledge that I’ve since picked up, I had been thinking about maybe dipping a toe back into the stock market pool. But where would a beginner like myself begin? Not too long ago, Alec Hogg interviewed Gerrie Fourie, the CEO of Capitec. The pair discussed the merits of EasyEquities, an online trading platform that allows individuals to invest small amounts in big time stocks.
Something like EasyEquities would be the perfect tool for someone like me, I thought. I could invest amounts I was comfortable with, play around and gain further understanding into share investing.
Here’s how it all started. Armed with R500, I set out to purchase minuscule amounts of massive companies. But what to buy? Ah, yes. There was a recent Rational Radio webinar about Tongaat-Hulett. The CEO sounds like he’s turning the company around, so let’s have some of that. The same with Sanlam, so let’s buy a smidge.
In the first week, I looked at my shares every five minutes or so, refreshing the page to see what has changed. Has it gone up or down? Have I made a profit? Have I made a mistake? I assumed this is what fathering a newborn is like, constantly obsessing over a small, newly acquired possession.
A month later, I’m down to checking it once a day. However, I still have myriad questions about the complex world of stock trading. Why, for example, do my Tongaat shares soar and dive like an indecisive 747? How long should I keep my MTN shares for?
If, like me, you’re in the same boat (i.e intrigued but confused by share investing) I’m sure you have a number of questions that you’ve always wanted the answer to but have been afraid to ask. In this new weekly column, I will endeavour to answer those questions (with the help of a professional, of course). Write to me at [email protected], with all those questions you’ve been embarrassed to ask. Together, we may learn something.