Stock Market Investing

Abstract

Growing up, my dad used to say he would never invest in stocks because the stock market is not for the average investor. He intimated that the market was rigged and, as I grew older, I began to wonder whether he just might be right. At the same time, I felt that he very well could be ignoring an investment opportunity of a lifetime as the stock market seemed to reach all-time highs on a regular basis. After careful analysis, I decided to recommend a stock pick to my dad so I presented him with the case for Coca-Cola. My friends would drink copious amounts of Coke, and the company had recently announced a discontinuation of its original formula only to have it reinstated after a brief period of time. All in all, this created a publicity coup for Coke, launched the Cola Wars, and shot the price of Coke stock through the roof. I begged my dad to buy shares of Coke, but he refused. Coke went on to become one of the most successful companies in history (with a stock price to match) and my dad kept out of the stock market settling for safer, low-yielding investments. Years have passed and I have studied the vagaries of the stock market. I can appreciate my dad’s words of wisdom, but not without some revision. True, the stock market is not for the misinformed or ignorant. But, at the same time, it can be an effective way to recognize solid investment returns over the long run. But buyer, beware! The stock market is not for the novice investor. Do your own research and you just might find yourself generating steady returns.