“I'm more of a long-term investor. I'm not too worried about the performance right now in terms of price, because I think you shouldn't care about the price of something if you believe in the business, it will gradually go up in the long term.”
I'm turning 24 and I'm a revenue analyst at Kiwi Rail. I just graduated from Uni last year and then I started working the week after.
What is your background story? When did you first start investing?
If I really want to go back to investing, this is not really stocks, but have you heard about the craze of Pokémon cards? So, I kind of started trading Yu-Gi-Oh! and Pokémon as a high schooler So, I was flipping those. That was my very first investment. Some of my cards have increased 100 times in value. People think it's just a children's card game, but these pieces of cardboard have really inflated in value. It's crazy. It's similar to stocks.
I'm a very casual investor, so I pretty much buy safe options such as ETFs such as S&P500, NZ 50, and Australian 50. And I buy shares in specific companies like Spotify, Tesla, of course, can't forget that one. Not going to lie, making a loss on most of them.
And how did you come across Tiger Brokers in the first place?
When I was searching for jobs, I saw the Tiger Brokers ad listings. I also see a lot of ads when you guys were doing those promo offers. It's pretty much word of mouth as well. My friends told me that Tiger Broker has the lowest transaction fees, and also offer pre-market and aftermarket trading, which other platforms didn't offer, it's a really good thing that other competitors may not have.
I still use other apps because I didn't withdraw or transfer my shares. I've been trading on Tiger Brokers thereafter.
What is your portfolio size with Tiger Brokers?
Around $10,000. And I'm planning to invest more because I feel like it's a good entry point. It's always good to invest during recessionary times.
What stocks are you trading? And why did you invest in these specific companies?
I have, Tesla, and Starbucks - but that was given for free. But if I'm talking about the ones, I bought myself, I have Spotify and SPDR, Palantir.
So, for Spotify, I really like its business model. There's been a lot of streaming services in the past, but most of them failed because of copyright issues. But the subscription model really kept Spotify alive and blooming, in my opinion. It's a subscription service that I use myself. It's a product I believe in. They're pretty much almost a monopoly in the music industry. You don't see people using YouTube premium to listen to music. I know they didn’t meet their earnings target due to pulling out of the Russian market because of the war, but if you account for that, I feel they did meet their target.
For Palantir, it's because they expanded in the market. They used to provide software solutions to the government, but I heard they started doing more consumer-level programming software. So, I feel like they've really expanded their market. It's just about capturing those market shares for them to grow, and it’s common for tech companies to make losses in the early stages, and that kind of reflects on that share price.
Tesla, I do believe in electric vehicles (EVs), and I'm sure many of us have seen more Teslas on the road these days. Yeah, I believe in Elon's products. Like, he has been an inspiration for many. He started off with PayPal, and all his products I really believe in. And he's a smart guy. I feel like EVs will be the future, especially with oil prices nowadays. But yeah, EVs as technology progresses, will replace oil, fuel-run cars, less pollution and all that and the battery life will be better. So, it's a long-term play. Of course, the shares are probably really overpriced because of how much everyone loves Elon. But yeah, the price adjusted. Tesla was over 1000 USD, and now it's 700ish.
What are your investing styles or strategies?
My strategy is to buy and hold. Like, I believe in the company and the business model. I believe in the business. I don't care too much about the price.
You can of course look at earnings per share, that's a huge indicator. Are they making money? Are the earnings efficient? There is other stuff that you can look at on their financial statements to see the credit risks. I do watch videos online, on what to look for, but I haven't really conducted any proper analysis myself. I know I should be looking at the credit risk and all that.
I'm sure you heard of dollar cost averaging, which I do recommend, especially if you could buy it at one point, and that could be a huge loss. But if you spread it out, if you believe in a company, it shouldn't be. You really reduce, like, the variance that price impacts can have. And the market is so volatile these days that it's good to average your purchases.
I'm more of a long-term investor. I'm not too worried about the performance right now in terms of price, because I think you shouldn't care about the price of something if you believe in the business, it will gradually go up in the long term.
I don't really sell because I believe in the business long term. Unless I really need the money or a better opportunity comes, I wouldn't sell my position.
How are your returns so far?
Not great. I'm pretty sure a lot of people's portfolios are not looking good right now.
If you could go back to when you were younger, what would you tell yourself about investing?
What would I do differently? I think I would invest periodically more frequently but at smaller amounts. So that's similar to the dollar cost averaging concept because I did buy sometimes at higher price points, a one or two-day difference and the price might drop a lot. So, if you average it out, it kind of reduces the price variance. Another thing is I'll probably buy more ETFs and fewer higher-risk individual stocks when I'm starting out. More ETFs just because I think being managed professionally, they have small transaction fees. They do the weighting adjustments for you. They reduce, transaction fees, and you don't have to pick winners yourself. The fund already picked the winners for you.
There's a resource fund as well. Yeah, it's power and energy, which energy is a good thing to invest in during a recession. I think it has like, an inverse relationship during a recession. Yeah, because it's an essential necessity. They're kind of like an oligopoly. They're kind of price makers. So essential goods, during a recession, you still have to pay for them.
What stocks or options are you watching right now? Why?
So, I’ve got AMD- it's the processor brand it’s Intel's competitor, they've been making more powerful chips at a lower price. That's why I watch listed them. And then I think when you go on like, processor comparison websites, they're always more efficient, like price, cost-efficient compared to intel. So that's why I had them. And you know, with bitcoin mining and stuff, everyone's trying to grab a processor. That really hyped up the price at the time.
Meta, aka Facebook, I wasn't going to buy anything. I just want to see the price percentage difference because they heavily invest in the NFT or like what's that word? Metaverse. The more blockchain kind of technology.
Fiverr it's a service that anyone can sign up for and they sell a service. Because I personally use that website to commission some art and I like that platform where anyone can offer their skills and expertise to someone in need. I like the business idea. And they seem like a monopoly in that area. And it is a growing market as well as they're getting exposure.
I think an important part is to kind of estimate the market cap and how much market share they have. I know, it's really arbitrary, but you can see what their key competitors are, and I can't think of any for Fiverr as of now anyway. As long as you believe in the business and their business model and they don't do any drastic changes, that will be a good company to hold.
What are the characteristics of your ideal stocks?
I look at if it's something that people will use and continue to use more of. And therefore, can it capture more users? And what is the market cap? Because if it's capped, then they're kind of not growing. Are they trying to expand? Like, are they producing more services? Are they doing something different? And it has to be in a positive direction, of course. Also, do I believe in their future projects? Which I think you can read in their report as well. They usually give you an overview of what the big changes are going to do in the near future.
I think ethics is not a big issue in the stocks I've invested in. It's not like it's a gambling or cigarettes company. Location, not so much because they have headquarters here, they have a factory there. They're all over the place. I’m looking for strict financial reporting in companies that I trust. The big ones are usually audited by renowned companies, which builds the credibility of what they're reporting.
What are your opinions on global stocks in the next few months?
I think in the short term it'll decline a bit more. Bracket disclaimer, I might be completely wrong, but it’s just what I think. But in the past, after a recession, stocks have soared the most right after. With inflation, the purchasing power of money is lower, so it's better to own assets, which is why I'll be using Tiger Brokers to invest more soon. The reason why I started investing as well is because the term deposit’s interest rate was too low, the last few years it was like 1-2% even for a term deposit. And it was just too low for locking your money into an account for like a year. So, in a sense, I seek volatility for myself, which I kind of regret. I think I expose myself to too much to risk. Looking back, I'll definitely buy more ETFs. It’s safer.
Are there any memorable achievements that you have made in your investing journey? What did you learn from them?
It could be a small thing, but I bought Tesla pretty early on and I didn't buy a lot because I was still a broke student. But yeah, watching your stocks grow or buying before a big price hike. It's always a great feeling just watching your portfolio grow, seeing stocks you pick grow like two times plus, as always, is a nice feeling.
I also have the Australian Resources Fund investing with Smartshares. I had capital gains, it was already really good, and they gave out dividends regularly, so that was a bonus on top of that.
Are there any mistakes you have made in your investing journey and what did you take from them?
I think investing a huge amount into one stock at a time. I'm not saying to diversify your portfolio, but if you're making a purchase, don't make a huge one in one go. Spread it out. Because if you buy at an unlucky price point, then it's hard for you to recover if that amount of money is a huge investment amount for whatever income level you have. Whereas if you spread it out, if you buy at a wrong price point, it's only 5% of what you would have lost if you did it all in one go kind of thing. So, if it evens out, you could be buying at a good/bad price point. So, if you spread those price points out, it will reduce the price variance because the stock market is always changing and who really knows what the theoretical price is.
I invest too much into risky stocks, even investing in single company stock is kind of risky compared to ETFs. And also crypto, everyone knows it's a huge risk.
What's your investment goal in 2022?
I think I'll reduce the risk of exposure to my portfolio. So, like, try to buy in safer stock that I mentioned before, or even if you buy something like Amazon or Google, those are safer options too, because they're already mature companies. They don't have large growth, such as a new start-up tech company. But over time, you've seen in the past they've continued to be successful. Although the gains might be lower, they are a safer option, with long-term returns.
I think I’d invest more into stocks because I had too much crypto before and it’s kind of crashed tremendously right now.
That's hindsight though, who really knows, right? What will happen in ten years, I don't know, even in five years. But I feel like, with new technology, there's always a risk.
This information only represents the interviewee's opinion and experience and should not be regarded neither as advice on acquiring or disposing of financial products nor an endorsement of Tiger Broker’s products or services. Some of the information being published here may involve paid or sponsored content by Tiger Brokers, its affiliates or business partners. The information presented should be only for your reference. Tiger Brokers assumes no warranty or responsibility for the accuracy and completeness of the information. Investing carries risks, including the risk of losing an amount in excess of your initial investment. Investors should do their own research and seek professional advice before using the services of Tiger Brokers and making investment decisions. Published by Tiger Fintech (NZ) Limited.