# Can someone be my stock trading mentor?



## asics (18 April 2015)

Hi everyone,

I'm 23 and got my first solid job last November. Currently I have nearly 15k saved up and plan to use 90% of my future earnings and invest them in the stock market over the next 5 years, which is when I plan to buy a house. I have opened an account at Bell Direct and can start trading, but I don't know what I'm doing. Can someone with stock trading experience guide me and answer my questions about (1) the technical aspect of trading online, and (2) helping me come up with a portfolio strategy that will aim to maximise my investments over the next five years.

Thanks for reading!

Yours sincerely,

Stock trading noob


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## Value Collector (18 April 2015)

asics said:


> Hi everyone,
> 
> I'm 23 and got my first solid job last November. Currently I have nearly 15k saved up and plan to use 90% of my future earnings and invest them in the stock market over the next 5 years, which is when I plan to buy a house. I have opened an account at Bell Direct and can start trading, but I don't know what I'm doing. Can someone with stock trading experience guide me and answer my questions about (1) the technical aspect of trading online, and (2) helping me come up with a portfolio strategy that will aim to maximise my investments over the next five years.
> 
> ...




Hi Asics,

First of all I would like to congratulate you on making a commitment to improve your life through saving and investment, you a definitely on your way.

The first thing I would like to say though, is that whether you decide to become more of an investor or a trader, I don't think it's a good Idea to jump into trading directly yourself, especially if your plan is to buy a house in 5 years.

I think the best method will be to put you $15K into a low cost Index fund, where you should earn a decent return over the next 5 years, and focus on learning more about both trading and investing.

As you learn and generate savings along the way, split your new savings you generate 50/50, by putting 50% into topping up your index fund, and the other 50% into your learner self managed trading/investing portfolio.

this why your guaranteed to earn the market return on your lump sum and 50% of your savings, But you still have a little portfolio where you can attempt to beat the market, which you may or may not do, and to be honest, most new investors or traders will not beat the market, at least until they have a lot of experience.


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## DeepState (18 April 2015)

asics said:


> Hi everyone,
> 
> I'm 23 and got my first solid job last November. Currently I have nearly 15k saved up and plan to use 90% of my future earnings and invest them in the stock market over the next 5 years, which is when I plan to buy a house. I have opened an account at Bell Direct and can start trading, but I don't know what I'm doing. Can someone with stock trading experience guide me and answer my questions about (1) the technical aspect of trading online, and (2) helping me come up with a portfolio strategy that will aim to maximise my investments over the next five years.
> 
> ...




Are you looking to INVEST or looking to TRADE?  The two approaches/mentalities are very different. If you need help on that point...just say so and a flood of responses are assured.  This decision is a key one for your journey of skill acquisition.  Nothing says you can't do both, but you will usually find that the approaches are very different and the temperaments required for them also.  They also purport to work for different reasons.  

Why not check out "Walking the Road to Riches" thread: https://www.aussiestockforums.com/forums/showthread.php?t=28717 as one possible source of thinking.  Maybe also take a look at "Most who want to get rich or retire wealthy have got it wrong" thread: https://www.aussiestockforums.com/forums/showthread.php?t=29509 for some interesting viewpoints and to highlight where the investment mentality intersects with the trading mentality.  Of note, look at the expectations of returns stipulated by some of the traders and the counter-arguments presented to ground these. 

Congrats on your first step...asking for a coach before you enter the game.  Look around here and you will see more than a smattering of personalities who enter the game thinking they are a coach.  An excellent first step.


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## galumay (18 April 2015)

May i heartily recommend this post to the OP,

https://www.aussiestockforums.com/f...t=29775&page=2&p=866611&viewfull=1#post866611


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## asics (18 April 2015)

Thanks guys. 

@Value Collector Thanks for the post, it makes sense. I'm pretty risk adverse myself but I think if I have a clear strategy I may be able to do well and learn fast. I just need someone go help me develop the correct investment strategy. Is this an example of an Index fund?  

@DeepState I think I'd lean more to the investor camp. I just want to buy shares and forget about them until I'm ready to buy a house. If there's an experienced investor please give me a P.M so I can ask you a few questions


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## craft (18 April 2015)

asics said:


> Thanks guys.
> 
> @Value Collector Thanks for the post, it makes sense. I'm pretty risk adverse myself but I think if I have a clear strategy I may be able to do well and learn fast. I just need someone go help me develop the correct investment strategy. Is this an example of an Index fund?
> 
> @DeepState I think I'd lean more to the investor camp. I just want to buy shares and forget about them until I'm ready to buy a house. If there's an experienced investor please give me a P.M so I can ask you a few questions




Your maximum time frame until you need full liquidity for the house purchase is 5 years and the time frame on funds fed in from future salary is progressively less.  

Your liquidity requirement and time frame aren’t suited to achieving any type of certainty from investing in the share market. 

You won’t learn to successfully pick stocks or time trades without considerable effort. You won’t invest or trade without exposing yourself to the risk of losing money.  If you want to put in effort I recommend heading down the trading route initially it’s more suited to address your liquidity requirement.  

Even ETFs over your time frame present you with rather large ‘market’ risk.  If you can’t at least quantify that risk and accept it – then I suggest some sort of goal saver account with a bank given you indicated you are pretty risk averse.

Ps 
I doubt any ‘experienced’ investor is going to PM you, that is not to say you won’t get PM’s – be careful.


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## Triathlete (18 April 2015)

asics said:


> *I just want to buy shares and forget about them* until I'm ready to buy a house.




If you do this there is a very good chance you will lose money.

Remember shares go down as well.

How will you feel if after you invested your money the shares all crashed by 50% how will you feel?

What will you do?

Will you still hold waiting for them to recover or cut your losses? 

Will you have the skills to manage  this situation?

What will you do next?

As you require the funds in 5 years unless you have a very good skill level to manage your investments you will be exposing yourself to too much risk.

You have received some very good advice already ,I suggest you follow it.

If you are starting out I would suggest you educate yourself first before putting your own money at risk, 

 this will take at least 2 years in my opinion depending on your available time.

Always remember the market will always be there, but you may not.

All the best.


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## luutzu (18 April 2015)

asics said:


> Hi everyone,
> 
> I'm 23 and got my first solid job last November. Currently I have nearly 15k saved up and plan to use 90% of my future earnings and invest them in the stock market over the next 5 years, which is when I plan to buy a house. I have opened an account at Bell Direct and can start trading, but I don't know what I'm doing. Can someone with stock trading experience guide me and answer my questions about (1) the technical aspect of trading online, and (2) helping me come up with a portfolio strategy that will aim to maximise my investments over the next five years.
> 
> ...




Good mentorship comes at a price young Skywalker.

Those others comes from YouTube, Amazon, Ebay, wikipedia and your local library


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## Value Collector (19 April 2015)

asics said:


> Thanks guys.
> 
> @Value Collector Thanks for the post, it makes sense. I'm pretty risk adverse myself but I think if I have a clear strategy I may be able to do well and learn fast. I just need someone go help me develop the correct investment strategy. Is this an example of an Index fund?




Yes that's basically an index, but I would recommend an Australian asx index, like the asx200


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## ThirtysixD (19 April 2015)

asics said:


> Hi everyone,
> 
> I'm 23 and got my first solid job last November. Currently I have nearly 15k saved up and plan to use 90% of my future earnings and invest them in the stock market over the next 5 years, which is when I plan to buy a house. I have opened an account at Bell Direct and can start trading, but I don't know what I'm doing. Can someone with stock trading experience guide me and answer my questions about (1) the technical aspect of trading online, and (2) helping me come up with a portfolio strategy that will aim to maximise my investments over the next five years.
> 
> ...




Hi
Ill be your mentor.

Whats the catch?
All you have to do is buy a few books and once you have read them send em my way (or vice versa).

Don't expect 24/7 hand holding, but I will give you my 2c on any trade/investment you are thinking of making (as long as its reasonable and not 20 each day).

My investing style is more along the lines of long term quantitative value (I like numbers). I don't have anything against the price game but I do believe that most new traders will lose most of their starting capital (I spent years on technicals/system design). If you expect to make easy money after watching a 5 minute video on a moving average cross then you will be extremely disappointed.

A balanced portfolio comprising several different ETF's is the way to go if you don't want to invest much time and energy.


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## get better (19 April 2015)

I've been looking for a mentor for years but haven't been successful. I hope you have better luck than me!

I've come to think of the ASF as my mentor - if you have any more specific questions, posting on the ASF, reading existing/historical threads or PM'ing members helps greatly.

My advice is to learn as much as you can - books are a good way to begin your journey. And then use the ASF to supplement your learning. Here are some books I've found very useful:

Investing/Fundamentals
- The Intelligent Investor by Benjamin Graham
- Common Stocks and Uncommon Profits by Philip Fisher

Trading/Technical
- Unholy Grails by Nick Radge
- Master the Markets by Tom Williams


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## tech/a (20 April 2015)

*You need to know what you need to know.*

Personally I think investment and trading is over complicated by the end user.
You don't have to be a Professor of economics or maths to succeed.

How does any business succeed?

Income exceeds expenditure.
Now just go about doing that *as simply and as uncomplicated *as you can.

Result no ulcers and profit.


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## luutzu (20 April 2015)

tech/a said:


> *You need to know what you need to know.*
> 
> Personally I think investment and trading is over complicated by the end user.
> You don't have to be a Professor of economics or maths to succeed.
> ...




true.

But if it's not complicated enough, how else will financial experts and consultants make money?


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## NickF (26 April 2015)

DeepState said:


> Are you looking to INVEST or looking to TRADE?  The two approaches/mentalities are very different. If you need help on that point...just say so and a flood of responses are assured.  This decision is a key one for your journey of skill acquisition.  Nothing says you can't do both, but you will usually find that the approaches are very different and the temperaments required for them also.  They also purport to work for different reasons.
> 
> Why not check out "Walking the Road to Riches" thread: https://www.aussiestockforums.com/forums/showthread.php?t=28717 as one possible source of thinking.  Maybe also take a look at "Most who want to get rich or retire wealthy have got it wrong" thread: https://www.aussiestockforums.com/forums/showthread.php?t=29509 for some interesting viewpoints and to highlight where the investment mentality intersects with the trading mentality.  Of note, look at the expectations of returns stipulated by some of the traders and the counter-arguments presented to ground these.
> 
> Congrats on your first step...asking for a coach before you enter the game.  Look around here and you will see more than a smattering of personalities who enter the game thinking they are a coach.  An excellent first step.




Hi DS,

Long time, no see  I checked back on the conversations from last year. 
I am also trying to make money in any financial area, is it better to be a trader, or an investor? 
I can change my temperament at will, but I am more often impatient and I develop a taste for gambling 

I will probably be back on the forum, looking for a mentor as well, or at least asking for help. 
I started on Friday a real Forex account ($2000) and I made my first $51. I wonder how long it will take me to lose it all (I am talking about the $51, of course...)


Cheers,
Nick aka "The Rhyno"


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## ThirtysixD (26 April 2015)

NickF said:


> Hi DS,
> 
> Long time, no see  I checked back on the conversations from last year.
> I am also trying to make money in any financial area, is it better to be a trader, or an investor?
> ...




Might seem harsh but I cant see this ending well (being impatient with a taste for gambling)

Hope you have a profitable system and trading plan!


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## DeepState (26 April 2015)

NickF said:


> Hi DS,
> 
> Long time, no see  I checked back on the conversations from last year.
> I am also trying to make money in any financial area, is it better to be a trader, or an investor?
> ...




Nick!!!  Hey Rhino-man.  Nice to hear from you again.  Hope all is well.

Investor/Trader?  It is better to find something with an edge.  Something that has the ability and reasoning to make you money from the market.  Overall, it is probably the most secure thing (of all the insecure ways to make money) is to be a buy-hold equity investor with a super long term horizon.  It is a game that many can win.  Your edge is being able to take on equity risk and holding on.  I can confirm that a premium is very likely to exist at present prices, although that premium is less than what it has been in the last. 

Forex is not exactly the easiest place to make money.

Gambling is fine as entertainment, obviously within bounds.  But, ultimately, it's entertainment.  You know you are doing it when the position you put on has rationale that you really can't hold a straight face on when explaining it.

Take care.


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## NickF (27 April 2015)

DeepState said:


> Nick!!!  Hey Rhino-man.  Nice to hear from you again.  Hope all is well.
> 
> Investor/Trader?  It is better to find something with an edge.  Something that has the ability and reasoning to make you money from the market.  Overall, it is probably the most secure thing (of all the insecure ways to make money) is to be a buy-hold equity investor with a super long term horizon.  It is a game that many can win.  Your edge is being able to take on equity risk and holding on.  I can confirm that a premium is very likely to exist at present prices, although that premium is less than what it has been in the last.
> 
> ...




Hi DS,

I am very well, hope you are too.
I read on the forum about the advantages of buy and hold good stocks. One of them being that you don't pay CGT and then if the company gives dividends, it adds up over time. We may go in that direction at some stage. At the moment I decided to try Forex (and you already warned me last time that this is a difficult way to make money). The reasons are that I can start very small and still trade for real. Basically the fact I have the chance to make or lose $5...$20 (the limit is entirely up to me) per day keeps me motivated to learn and it will put me in the proper frame of mind to absorb new information. Today I read again about risk management and it is probably the most important lesson for a beginner. On Friday I had a blatant disregard to the safety limits, that's why I ended up with $51. I already discovered that if I had used stop losses, I would have reduced significantly those bad trades - I've done in total over 10-15 trades in a few hours... Knowing how to set limits and learning to stay within those limits is very important to practice. I'm looking forward to tomorrow. I took Friday and Monday off work and I can experiment. 

Cheers,
Nick


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## bonkerrs (4 May 2015)

NickF said:


> I'm looking forward to tomorrow. I took Friday and Monday off work and I can experiment.




how did you go? built on the 51 bucks?


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## cynic (4 May 2015)

bonkerrs said:


> how did you go? built on the 51 bucks?



Much as I'm curious about this myself, I'm sure you'll agree that the fate of a certain ($2k live FX) account, may be confidently deduced from certain sentiments already expressed within this thread.


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## NickF (25 May 2015)

bonkerrs said:


> how did you go? built on the 51 bucks?




Yes, I reached $91. Then I got very confident that I'm doing a good job. I started betting against the trend, small amounts ($1000) and in no time (a few hours in fact) my account dropped to $1730. I've done one more transaction overnight and now I have $1710 or so. Time to pass the account to my wife, she's confident she'll recover my losses. She has more experience than me, she traded her virtual account for over three weeks now.

In the meantime, I'm going back to school. Have to learn to sort flowers, to prove to myself I'm capable of building a better brain than mine 

I reached the conclusion I am not fit to be a gambler. The pain of losing money is greater than the pleasure of gambling...

Cheers,
Nick


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