Diary of a Noob Investor @ 11 Feb '21 - Staying Green in a Sea of Red
I am now 10 days into my investing career and yesterday I hit my first red patch.
The red days I know have to come - that is part of the game. Hopefully though as I build up and diversify my portfolio that won't happen too often.
I'm now all in and look forward to the journey ahead.
Growing the Portfolio
I've been busy, busy, busy reading and researching these past few days to find the right stocks to buy.
My portfolio has now grown to 16 different stocks. All little positions but as I get more confident and earn more I will add to the ones that are working out well.
I'm working from the ground up with my green investment strategy and started with a few lithium and nickel mining companies like BHP, Glencore, Lithium Americas, Livent, MP Materials and Vale.
Which ones will fly high I'm not sure but with the massive forward demand for nickel and lithium for EV batteries the whole sector feels like a fairly sure bet.
So far Vale has been my best performer.
Renewable energy is one of my other target sectors and I am now starting to track down suitable stocks to go for.
This is not such a fast moving area as EVs but with a growing government level momentum building towards renewables to help combat climate change this should be a good long term bet if I can find the right companies.
My first two renewable buys have been SolarEdge Technologies and The Renewables Infrastructure Group (TRIG).
SolarEdge has been doing well and stayed in the green.
I just sneaked in with TRIG in the nick of time buying a few minutes before the close today which I think will qualify me for this quarter's dividend. Dividends are new territory for me so I've got to wait and see on this.
A few other stocks that were a bit more off my green track sneaked in as well. I will cover those more later.
Green v Green - the Ethical Dilemmas
As I posted about last month I am trying to follow a 'Planet Positive' investment strategy particularly focusing on Electric Vehicles (EVs), Renewables, Plant Based & Organic Food, and Social & Peer-to-Peer...
I am still with this but it is definitely throwing up some interesting investing dilemmas.
Mining is a good touch point for this. All mining companies have environmental impacts and problems - whether it be pollution, or energy usage, or dam collapses.
But without mining we won't have lithium and nickel, and without lithium and nickel we won't have batteries, and without batteries we won't have EVs.
And on the subject of EVs investing in the new EV companies like Tesla and Nio is one thing, but what about the legacy car giants like GM, Ford, Volkswagen, Toyota and Hyundai?
They account for the massive majority of car manufacturing capacity.
Are they going to throw in the towel as the all electric future looms ever nearer? Of course not - they are going to adapt and change tack.
Most have already declared their intent. Just recently for example both GM and Ford have announced massive $20+ billion R & D spends on electric vehicles.
As I am investing for a green tech future should I support and invest in these car companies or should I shun them as they will continue to make petrol and diesel vehicles for a good few years yet?
What about oil companies? They are making moves towards renewables buying up solar and wind companies as fast as they can.
Just today oil giant Shell announced that it is planning to install 500,000 electric car charging stations by 2025. That is a pretty major green move for an oil company.
But would I, should I, could I ever invest in an oil company !
This is definitely a topic I will be returning too again and again.
Five Things I've Learnt So Far
Despite the red days I am absolutely loving investing.
I am learning so much my brain is bubbling.
Finding out about so many new companies and new industries, as well as bit by bit chipping away at all the terminology and techniques of the investment game.
A few 'investment tips' I've picked up in my first ten days...
- Don't buy stocks on impulse - do the research.
- Don't place buy orders out of market hours without Limits - who knows what will happen when the bell rings.
- Don't buy SPACs unless you can get in early - if they are all over the YouTube stock pumper channels you have missed the boat.
- Know when each market you are buying in opens and closes in your local time.
- Play the long game when you get started - only when you know what you are doing allow yourself a bit of short term trading.
I am definitely enjoying investing.
It is my new second favourite hobby - growing money is almost as much fun as growing food !
Now I have had my first red days I guess I have levelled up a bit in the investing game.
Diversity is key - even only having 16 stocks in my little portfolio helped me keep my downturn to only around 2%.
I am planning to get to about 30 stocks by next month to reach the first target for my portfolio.
Alongside the stocks I will shortly be launching into the other half of my 'Grand Investment Plan' - crypto.
I must admit I find that more daunting than stocks.
With the much bigger potential gains (and losses) and the supercharged technology and terminology I am entering the world of crypto investing with great trepidation.
I will definitely be asking for advice and assistance from the community here to help guide me with this.
To kick off I need to get a good exchange account set up. My first attempt with KuCoin didn't go well. More on that soon.
In the meantime tomorrow I am going to be checking out some more renewable energy stocks like Canadian Solar, Enphase Energy and Greencoat UK Wind.
Happy investing...
Pennsif
Please note, I am not a financial expert and this is not financial advice. Do your own research and seek professional advice if needed.
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