Subscribe to Aridni “Acey said ten percent.” – Why less is more.

Before jumping to the reply, let’s apply this to the stock market. Investing around $300 means the stock has to go up 10% before you can even see any profits. That’s taking in your buying and selling commissions.

I understand it is a little less for the commissions, but the amount of money you would be making right after would be practically negligible.

Why is this good that you don’t make any money? Because it teaches you how to pick stocks that will do well. If you have to work harder to break even, then when it comes to investing bigger amounts down the road, you will have a much better eye for stocks.

Sure you could lose money, but you can always lose money in anything you do. The stock market is not exempt from risk, regardless of how much you invest or how much you know.

Once you have a grasp on picking out stocks that are winners, putting more into the next good stock will be much easier. When you invest $1,000 in your stock now, it only has to go up 2-3%, to get your commission money back, but since you know how to do your homework you picked one that will be going up at least 10%.

Then you can tell them, “It’s too bad Acey aint in charge no more.”

This article written by Todd on 26th March 2006

1 Comment »

  1. Carnival of Investing #15 - Fat Pitch Financials says

    […] “Acey said ten percent.” Why less is more - Todd at Aridni discusses why buying stocks with only a small amount of money requires you to focus your efforts and can help your learn to be a better investor. [These small amounts are perfect for Going Private Transactions.] […]

    March 26th, 2006 | #

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