johnnyfdk
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Just bought more facebook stock.

If we learned anything from watching The Wolf on Wall Street, we know that stocks are  gamble. A few months ago, I realized that I had a lot of liquid cash sitting in my checkings account from the profit of my eCommerce stores.  I had three choices, leave it, buy something with it, or invest it.

Knowing nothing about stocks, I decided to email the richest guy I know, my buddy JP.  He had bought FB stock himself, so I figured, I trust his judgement more than my own, or anything I read online from strangers, so what the heck.  A few days ago, I saw the stock drop by 10 points.  Originally I had set an auto sell at trigger for 55 which means if FB ever dropped that low, I would automatically sell all of my shares.  Luckily, thanks to friends on facebook and comments here on my blog, I deleted the stop loss, as I would have just sold all of my shares for a loss.


What did I do instead?  I bought more.

I emailed JP again, and asked him what to do.  Being scared of losing it all, I originally set the stop loss so I would only lose $2,000 if the stock went down.  Then someone pointed out that once it starts dropping, you're fck#d

"Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway." - Warren Buffett.




This is the advice I got from JP, who is a CEO of a rather large company as well as both the richest and smartest business man I know.  It makes sense for those with a scarcity mentality to want to sell and run when stocks drop, while the rich, those with an abundance mentality see opportunity when stocks drop and buy more.

Well since this is a learning process, and I'm making enough with eCommerce where my bank accounts have almost refilled itself since I last spent $10k on FB stocks anyways, I might as well go for it.



I'm now the proud owner of 245 shares of Facebook stock.  It's crazy to think about it actually.  But it's exciting.  You can read the first blog post here:  that explains why I bought the first $10k. A big thank you to everyone who has given me solid investment advice.

I'm sharing this with you so hopefully you can learn from my experience as well as my mentors.  Please don't go out and invest all of your money in FB stock just because I did, as I have no idea what I'm doing.  But do follow along to see what happens!

Update:

I'm glad I bought when I did as FB stock just went up overnight.  Hurray for good timing.



Warm Regards,

Johnny
www.facebook.com/johnnyfdk
www.twitter.com/johnnyfdk


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  1. Hi Johnny,
    Just one question comes to mind - your buddy JP wouldn't be JP Morgan, would it? LOL
    I think you are investing wisely - just diversify a little as you grow.

    George

    ReplyDelete
  2. So far seems like it was a good call and nice timing. Facebook shares have just gone up 6-7%!

    ReplyDelete
    Replies
    1. Yup, just made $1,000 today. I'll post a screen shot of it with an update in a second.

      George - I'll tell JP you said hello. =) And yes I will definitely diversity as I grow. This is more like a fun gamble for me than an actual investment.

      Delete
  3. Followed your lead Johnny, if you hear a word to sell from JP, please let your following know ;)

    ReplyDelete
    Replies
    1. MJ, will do buddy, make sure you are connected to me on twitter @johnnyfdk and facebook.com/johnnyfdk as well. I'll let everyone if I buy or sell my FB stock.

      Delete
    2. Ha! I'm glad you pointed that out, I had you on twitter and I thought I had you on FB but I friend requested you personal name instead of the FDK so that's why I wasn't getting you on there. Corrected & thanks!

      Delete
  4. Hi Johnny,

    Just discovered your site and YouTube channel. You are living the life many of us can only dream about.

    As for your investment, I hope this is just for fun and I would be curious as to where you investment the rest of your money. Personally, I'm a big fan of index funds. There is nothing better for long term investment.

    Btw, I'm also from the Bay Area.

    Cheers

    ReplyDelete
    Replies
    1. Hey what's up, glad you've been enjoying the Youtube channel and blog. If you have enough money to invest in index funds, you definitely have enough money to be living in Thailand! It's not a dream, it's just a plane ticket away.

      Delete
    2. Since you are making more money than you spend, the smart thing to do is to save for your old days. Open an IRA account if you don't already have one.

      You don't need a lot of money to invest in index funds. It's usually around $3000 minimum. Or you can invest in ETFs.

      The trick in investing is to put your money in low cost funds, diversify, and invest regularly (ex. monthly.) Below is an example of what your portfolio could look like.

      55% US market such as VTI (Vanguard Total Stock market ETF)
      25% International such as VXUS (Vanguard Total International Stock ETF)
      10% Bond such as BND (yes, Vanguard again)
      10% Alternative such as Gold (GLD) or VNQ (Vanguard REIT)

      Remember, this is a long term investment strategy (15, 20 years) and make regular contribution. You are still young. Time is on your side.

      Investing in single stocks are risky. Especially high tech companies.

      Long reply but trust me, this is the best financial advise anyone can give you.

      Lastly, I do not work for Vanguard and have absolutely nothing to gain from you buying any of those.

      Delete
    3. Hey thanks for taking the time to write up the retirement advice. I have looking into IRAs as a future todo list and will use your advice as a starting point. I took a look at the 5 year growth and Max lifetime growth of each of the funds you recommended and see why you recomend them. Hope all is well and cheers the heads up.

      Delete
  5. Hey Johnny,

    A fellow Bay Area original here. I completely agree with the ETF strategies above, individual stocks are a losing game for retail investors. You already have a Schwab account, and they have a line of ETFs that you can trade commision free (I currently work in investment banking in NYC-not Schwab-and majored in Finance, so I'm not just talking out of my ass).

    Just discovered the blog/podcast a couple weeks ago - can't stop listening! Trying to get as many ideas down on paper as possible and start something soon. Keep the podcasts coming!

    Ben

    ReplyDelete
    Replies
    1. Hey Ben,

      Glad you are enjoying the Travel Like a Boss Podcast and the blog! Thanks for the ETF advice, I'll be looking into it.

      Delete
  6. Hey Johnny, picked up the blog, podcast, book & course (you got me 100%) a while back and look forward to new posts/pods each week. In my former life, I have a Masters of Economics and I too say go with ETFs for stock diversity and as mentioned above you can even play in the real estate game with REITs (basically a mutual fund of properties instead of stocks). I always tell folks buying individual stocks is like riding bulls in the rodeo (and yes, I live in Texas). There is a small chance he won't buck, which is disappointing for everyone or more likely you will either have a great ride or get bucked off and break a rib or at least get some nasty bruises. While the good rides are great, just look at some of the 40 year old rodeo riders who walk like they are 80 and you can tell that maybe the risk-reward just wasn't the best for most of them.

    In short, invest in diversified funds/bonds with 90% to 100% of your money; invest in individual stocks for fun or to make a statement (i.e. green stocks).

    ReplyDelete
    Replies
    1. Hey Leonard,

      I'm glad you're enjoying the blog, Travel Like a Boss Podcast and the 12 Weeks in Thailand Book! Also thanks for the advice on the ETFs, I'm definitely planning on moving my investments over to ETFs whenever I pull my money out of the FB stocks for long term investment. But you're right, right now especially since I'm young and a bit wild with my money, it is fun to invest in something like FB and does feel like I'm riding a bull. Definitely not the safest thing to do but it's definitely exciting for the time being.

      Delete
  7. Woohoo! Love your friend Johnny! He made a good call, the earnings were great! What now? How long do we hold?
    Thank you JP!

    ReplyDelete
    Replies
    1. Hey MJ, nice stuff! What were the FB share costs when you jumped in? I'm glad you made some cash from it already. I'm in LA now and seeing JP this week so I'll let you know what he says. I'm planning on holding it until it reaches 78 and selling half of my shares at that price, and then selling the rest hopefully at 80+ =)

      Delete
    2. Hey Johnny, I got in at 57.50 (I put in a bite for that price after the dip and it hit the strike price the next day so I got in). Have a good time with JP, you're lucky to have such a smart friend. And you should tell him about us little people because while I definitely don't have enough to get rich, every little victory like this feels awesome and it's thanks to you and him (and it doesn't cost him anything to help us out). So THANKS to both of you!

      Delete

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