Wednesday 24 September 2014

My Stock Market Ride: A Foolish Investment

What would you do if you had foolishly "Buy High"? 

Well, I had purchased two lots of NeraTel at a very unattractive price in terms of my standard back in May. It was only my second stock purchase and definitely a foolish one. What am I going to do about this? Honestly, I'm not sure and have been thinking about it for quite a while.
  1. The purchase price was very high and it was near the 52-week peak. Clearly, I did not have a margin of safety. A small correction can make me bleed for a little while, that's for sure.

  2. Generally, the market is rather high and uncertain at the moment. A market correction in the near future seems to be expected by many, including myself. A major correction would definitely "kill" me.
My position in NeraTel.

Here's a confession, I did not put in much effort back then to determine the price that I would be comfortable paying for NeraTel. This was unlike my purchase of SATS where I did a lot of research. Fortunately for me, I have received dividends amounting to a total of $120 from this foolish purchase. I hope I will figure out something soon with regards to this "Buy High" issue.

Anyway, for those who are wondering why would I be worried about a market correction? Well, in this case, it is a double-edge sword for me. Being a student, my investment capital is limited. If I were to purchase more lots of NeraTel during a correction, it would mean having less capital for other opportunities. Hope that would answer your question.


Regards
The Frugal Mat

1 comment:

  1. Interesting, you used iOCBC. You should do a post on that, benefits and non-benefits. How does it work? Are your holdings in a custodian account/CDP account? What are the commissions payable like?

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