Hi, my name is Keegan Santasiere and I am a sophomore undergraduate student at Ithaca College majoring in business administration with concentrations in finance and sport management. In this blog post, I briefly summarize the beginning of what I hope is a continued and fruitful investing career.
During the pandemic, as many people did, I started my own brokerage account. The market was incredibly bearish from late March to late August, so I figured, why not! In July I put $200 dollars into the account with little knowledge of how to invest in the stock market. I had enough insight to know that it was a sensible time to put my money into a prestigious tech stock. This was based on the assumption that the stock price would rise in the coming months, and I would have the opportunity to sell. I thought this one share could make me eight or ten dollars after a month or two.
My investing journey began when new, personal interests sparked in the concepts of money making money and the ways the rich get richer. As a college student trying to focus on my schooling, I partake in a variety of extracurricular activities, while also trying to earn money to pay for my education. I am nowhere near rich, but I know that now is a better time than any, to learn how to invest.
During the fall of 2020 I learned the basics of investing. As a second year student attending Ithaca College, I had the opportunity to join Core Trading Consultants where groups of students create presentations to offer their actual insights into potential market opportunities for the Ithaca College Fund, allowing direct interaction between the students and the college to make real time and impactful investment decisions. I also have had the opportunity to speak with fiscally educated people in my life, including Essex Trading founder and CEO, Miguel Ferreira, who has taught me valuable facts on investment in the stock market. Learning the lore of many successful investors with different perspectives to the game has given me a broad viewpoint on all things stock market related. This is something I am truly grateful for.
Early in the semester I sold what I had from the tech stock I had chosen, Microsoft. This stock raised in value by fifteen dollars in the matter of ten to fourteen days. From there three stocks were bought, as early on I learned the importance of diversification. With only $215 dollars it's not really necessary to have diversification, but I was trying to go through the motions I had learned to implement good habits when the time came to put in more money. These three stocks were held for about two weeks and my account balance was at $222 by the end. Seven dollars was made in fourteen days. This small win, on top of my lucky first win, for some reason gave me the confidence to put another $300 dollars into my account.
With $522 dollars in my account I used most of it to buy a new stock called $SNOW in late September. After a week it lost me the twenty dollars I had made, plus some. This was disappointing, as it was the first time since I started that my account balance trended down. I had even lost money. I took my money out of my brokerage account and decided I needed to learn more on investing before I started using this money to make more money.
During the fall semester, I learned a great deal on the ways of investing in the stock market. I still consider myself a beginner, yet I know enough to feel confident and comfortable making my own investing decisions. A book I would recommend to all readers, specifically young readers is Rich Dad, Poor Dad by Robert Kiyosaki. This is a personal finance book that teaches the very basic concepts of how money has the power to make more money. In this book he describes what the rich teach their children that the poor do not. This is fundamental financial literacy, applicable to all economic classes. This is a book, in my opinion, that you should read before any other personal finance or investing book. It gives you the valuable basic understandings on the background of building wealth.
During the fall I started an Investopedia investing challenge with my family starting with $100,000. Currently, after three months my account is at $183,000. That is an 83% return rate. This is a success that could make an individual, such as myself, incredibly presumptuous. Why not put another $1,000 into my account and make $830 dollars by April? This would be reckless as it is significantly easier to have higher returns on a stock challenge. The reasoning, I am not too sure of.
Investopedia Trading Activity 11/21 - 12/11
If I had to guess why returns tend to be greater through real time simulations, on apps such as Investopedia, it possibly could be because it is not real money. There are no legal responsibilities to look out for, and there was unlimited buying and selling allowed. With fake money, I make riskier decisions that have the ability for higher reward. There is the fear with real money. Most people, including myself would most likely be nervous investing money in a small cap stock that had the potential to double in one day if it also risks lessening by the same degree.
Ultimately I was in second in the investing challenge in between my step father Jeff with an account value of $232,000 and my moms at $118,000. We had a $100 dollar bet on the challenge, losers giving the winner each $50. So, there is a possibility the psychology of real money was involved after all.
I gradually have become more comfortable and confident in investing in smaller and medium cap stocks, cautiously with real money. That $500 dollars, I have put into my brokerage account has turned into $620 after five months. 87% of that return was in November and December alone. The Investopedia challenge was the best learning experience for me because I could make decisions and deal with the consequences of fake money.
It taught me a few things...
1) Do not rush into a trade,
2) Avoid overtrading,
3) Past trends will often continue,
4) Don't be stubborn, and most importantly,
5) Think of risk vs reward.
My Trading Quote of the Day (#EsxQotD)
“Winners are not afraid of losing. But losers are. Failure is part of the process of success. People who avoid failure also avoid success."
~ Robert Kiyosaki