Authored by Shelby Montevirgen

 

“To foresee is to rule”- Blaise Pascal

This quote popped into my mind when I was asked to write my musings as an investor, and gasp, singularly, as a “woman” investor.  I took up this task with my mother on my mind.

My colleagues are often curious: What was on my watch list?  What’s sitting in my current line-up of positions?  We’ll get to that in another article.

In this article, I will cover a few basic lessons that, however basic and fundamental, are often underestimated and sometimes forgotten.

I think the essential question here is why I am even an investor in the first place.  With savings among Americans at an all-time low, I had to think about how we first learn to become investors: financial literacy, let alone investing, is not commonly taught in school or elsewhere.  

These habits are often modeled–or anti-modeled–by parents or family.  Maybe it’s that one uncle who invested, locked and loaded, into a long-term mutual fund with a “sit on it and forget it” investment strategy.  My mother, on the other hand, was a little more unconventional.  

Here are the lessons she modeled for me.  

Keep in mind this is a woman who single-handedly raised three teenage girls on her own, worked twelve-hour shifts, got a degree in her forties, learned to invest on her own…and, as if that wasn’t enough… lived to tell the tale!

 

Lesson #1  Have a Voice (hint: speak up!)

Your money manager wants you to divvy up your funds a certain way. He (or she) is the “expert,” the pro who has years of market experience. But what if your own sensibility–that is reason and intuition–is telling you otherwise? Well, it’s time to speak up.

Besides, you have walking-around money. Speak up and then place your positions (walk the “talk”).

Rule of thumb: As writers write what they know, investors should invest in what they know.

And more importantly, let your financial advisor or money manager know what you want. It’s your money…so stand your ground when it comes to looking after your own interests. Ask questions, and make sure you fully understand every part of the investment process. Hold steady, and jump ship when you need to.  

 

Lesson #2  Know your Platforms

My mother, who also holds a self-directed account, is constantly monitoring her positions.  We talk about the merits of today’s high-tech trading platforms.  But do they make sense?

 If my 74 year old mother can navigate it, see the loss/gains, and newsfeed, she feels more informed and again this builds your voice and agency as an investor.

 

Lesson #3 Be Familiar with the Industries and Sectors In Which You Are Investing

Want to invest?  What industries and sectors are hot right now?  Get familiar with a few key fundamental approaches to analyzing markets.

For instance, I am a big proponent of William O’Neal’s CANSLIM theory (it works for me but it may or may not be right for you…be sure to do your own homework).  It helps me spot when a stock in a particular sector is blowing up.  Then I buy that stock.  If an entire industry or sector looks worthy of investment, then I consider gaining exposure to it through an index ETF.  

 

Lesson #4  Honor and Stick to a Stop Loss Strategy

Failure can be a great teacher.  My single mother like many others had to go back to work from retirement in her 60s to make up for the losses her retirement folio took after 2008.  She invested shrewdly after this market downturn.  

She’s turned small positions into a sustainable amount of capital. For instance, she began taking positions in Disney immediately after the 2008 financial crisis– a time when many investors wanted to stay out of the markets. That position alone has turned into a tidy sum that is now earmarked for her grandchildren.  

As investors, we all have to learn from someone.  Look around, find that inspiration, be sure to learn how to manage your risks, and take the jump…slowly and carefully.

Remember that there are lessons we learn from diving in, but there are also plenty of lessons we can learn from making “small” mistakes (emphasis on small).

 


The risk of loss in the trading of stocks, options, futures, foreign exchanges, foreign equities, and bonds can be substantial and is not suitable for all investors. Trading on margin or the use of leverage is not suitable for all investors and losses exceeding your initial deposit is possible. Supporting documentation is available upon request. Trading futures, options on futures, and foreign exchanges involves substantial risk of loss and is not suitable for all investors. Carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources and only risk capital should be used. Opinions, market data, and recommendations are subject to change at any time. The lower the margin used the higher the leverage and therefore increases your risk. Past performance is not necessarily indicative of future results.