Life Changing Investments
I have been involved, in one capacity or another, with the financial industry for over twenty years now. The one thing that all the good people in the industry hope to find is a life changing investment. The type of investment that will benefit our clients so much that they can stop worrying about money and start just deciding what they want to do with all of it. The type of investment that will create enough good will for our businesses that we can simply go about making good decisions without having to spend time worrying about how each one looks in the short term, because ultimately, enough of the decisions turn out to be right and time makes our cases for us.
Today, after six years of being involved with one particular company, researching it, owning its stock, trading its stock, hedging its stock using options and finally owning a sizable position in the stock, I believe I have a potentially life changing investment opportunity.
Interestingly, this company is not the first company I have found that is up several hundred percent for me with the potential to go up many times more. I have found about one such stock per year going back to the mid 1990s. The reasons none have become a life changing investment however is that I never have owned enough of one of these investments for long enough of a time period.
Industry mantra is to maintain wide diversification. That alone prevents most people from ever getting much ahead, much less having a life enhancing investment experience. Over the past 12 years, a widely diversified portfolio would not have done any better than matching inflation. What was the point in that? Was it worth the risk? An investor could have invested in a global government bond fund and done that well. I wish I had known then what I know now.
Another common industry practice is to "take profits." While there is a time for that, it is usually done far too early and far too often. What actually turns out to work better is to sell losers quicker and hold onto winners longer.
Having an effective trading approach within an investment strategy is no easy task, but we can be more right than wrong if we follow a system. We'll talk more about trading in a different note. And again, I wish I had known then what I know now.
The company I am preparing to make an even larger investment in has all of the prerequisites of being a life changing investment. Here is the partial list:
Strong ManagementSolid FinancesA large marketA market that can be potentially dominatedThe means to dominate that marketAbility to make large marginsStrong barriers to competitionA low starting point / early enough entry
There is always the possibility I am wrong, that the management does not execute, that a strong competitor emerges who is currently unseen, or that other circumstances defeat the company’s goals. My level of confidence in this investment, after years of research, however is as close to 100% as it can get, call it 99% confident.
So, with this potentially life changing investment, I am going to own enough of it for long enough to make a difference. If you are a client that owns stocks you already own this company. If you are a mutual fund only investor, contact me if you want to consider changing that approach, I have created a special portfolio of focus funds that also includes up to a half of a dozen potentially life changing investment ideas. If you are not a client and are interested in this opportunity, I suggest contacting me as soon as possible.
Your looking to enhance lives Advisor,
P.S. Fools, the company is listed in my portfolio. I won't mention it exactly, but you can probably find it.