Introduction
Investing is a discipline that requires a combination of patience and determination. The notion of achieving substantial returns in a short time span is unrealistic. My journey in investing began in early 2020, at the age of 18, prompted by news of the market downturn due to the uncertainty surrounding the COVID-19 pandemic.
Motivated to capitalize on what was described as a once-in-a-generation crash, I dove into a wealth of educational resources. Countless videos and numerous books became my companions as I sought to equip myself with the knowledge needed to navigate the complexities of the financial markets.
Throughout the ensuing four years, I weathered the highs and lows of the market. Even on days when headlines painted a bleak picture of the world's economic landscape, I remained determined. Despite the challenges, I consistently invested whatever I could afford from my modest minimum-wage job, fueled by the belief that my unwavering determination and consistency would eventually yield positive results.
Now, in 2024, my foresight and commitment have proven fruitful. The journey has been a testament to the saying that successful investing is not a sprint but a marathon, requiring resilience and a long-term perspective.
In this blog post, I will talk about the intricacies of my investment strategy for the year 2023 and share how it ultimately proved to be a rewarding endeavor.
Remain consistent
To give some insight here is my total performance for the year 2023:
The visual representation highlights the performance of my portfolio (depicted by the green graph) in comparison to the S&P 500 (depicted by the blue graph).
Note: None of these returns were achieved from speculative option put/call plays but rather by simply buying and holding.
Over the past year, my investments have yielded an impressive return of over 145%, outshining the S&P 500's respectable 28% return during the same period.
While it's valid to attribute some of my portfolio's success to the overall market reaching all-time highs, particularly the S&P 500 and Nasdaq 100, it's crucial to recognize that this success story began well before the market upswing.
The pivotal factor influencing these returns was my strategic decision to invest when most others were divesting, a move initiated in February 2022. This timeframe coincided with the 2022 stock market decline, triggered by the Russian invasion of Ukraine, concerns about an impending economic recession, and the Federal Reserve's swift interest rate hikes in response to inflation from the pandemic-induced monetary injection.
Know what you're buying and stay the course
In 2022, the S&P 500 index peaked at 4,796 on January 3rd, gradually declining over subsequent months. Maintaining confidence in your investments during challenging times is crucial. Take $META, the company behind Facebook, Instagram, and Oculus, for example. In October 2022, its stock plummeted to $90 amidst concerns about Mark Zuckerberg's ambitious "Metaverse" vision. Despite market frenzy, I observed Meta's strong fundamentals, with two major social media networks, top advertising platform status, growing daily active users, and low operational costs.
Despite the prevailing trend to sell Meta stock, I took a contrarian approach. After reviewing their Q3 2022 financial report, I invested a significant portion of my savings, buying 121 shares at $94. Despite initial losses, I held onto my belief in the company, and my conviction proved right.
This experience underscores the importance of investing in companies you believe in. While the prevailing trend was to sell Meta stock, my belief in the company led me to buy and hold, a decision that has proven successful over time.
Conclusion
In conclusion, successful investing requires strategic insight, patience, and unwavering commitment. Beyond numbers, understanding your investments and maintaining a long-term perspective are key. This journey reaffirms the timeless wisdom that staying true to principles leads to enduring success.
I believe that everyone can learn this skill if they put the time and effort, especially young people. In a world where it is so easy and almost mandatory to spend money, where money is something that revolves around us 24/7, it is only logical and responsible that we take initiative to learn more about it, to save it and to grow it. I recently wrote an article on how and where to begin investing as young investor, you can check it out here.
Thank you for taking the time to read this article, I hope you enjoyed it. I am open to any suggestions, feedback, and new article ideas on topics that you would like me to write about. 😊