Three years ago I began my Toronto Stock market adventure. So it's a good time to reflect. There is some good news: I beat the TSX market index by quite a bit. The bad news is that in 3 yrs time, the index was overall just flat.
The big spike in portfolio value (blue) of feb 1 2012, was thanks to a takeover of Gennum by Semtech. The price of Gennum more than doubled that day.
A 13.8% return is modest for a 3yr investment, but it beats the lousy interest on saving accounts these days. I remember saving as a child in the Netherlands, and getting a hefty 10% annual interest from 'the Zilvervloot'. I also traded on NYSE and Nasdaq. Even though the US stocks were more profitable than my Canadian stock, I failed to match either NYSE or Nasdaq performance.
Anyway, my lessons learned so far:
- Got burned by Arise, a solar panel company. It went bankrupt soon after I bought it. Don't get suckered into green tech: they don't all have Tesla like stock performance. They typically falter.
- You need a lot of patience with irrational market sentiments. Why is AAPL still not valued properly? It's my biggest US holding, and I lost money on it.
- Take over bids tend to be good news, with an instant hike in stock price. It happened to me a lot. I think a lot of Canadian industries are consolidating.
- Often, the real money can be made on dividends, instead of stock price. It pays to concentrate on companies that pay their investors well.
- My biggest money maker was a US stock: Stratasys, which makes 3D printers. When I bought it, it was expensive, but still it tripled in value in a short period. Market leaders in brand new industries tend to do well. (I missed out on Tesla, but that would be in the same category.)