Joining the experienced investors in The Motley Fool community are novices who know the market is the place to make money, but aren't ready to jump in with both feet. Molly Simoneau, who works in the Fool's member services department, opened her first brokerage account a couple of months ago and bought her first shares of individual stocks soon after. She owns shares of gaming company Activision Blizzard
Activision Blizzard is a big company, with a market cap of $13.5 billion and the well-known World of Warcraft in its stable. EnergySolutions clocks in with a much lower market cap of around $550 million. Molly did her homework and says of the company: "They've got cash, they've got positive cash flow, but they also have a $505 million debt." Since she's new to investing, she also turns to others for insight, saying "The Motley Fool Hidden Gems team, who has recommended this stock, says that they're 'confident that debt won't be a problem.' "
Check out Molly's Motley Fool CAPS blog -- called "Adventures of a Beginning Investor" -- and you may find yourself inspired to join her along the learning curve to being a lifelong Foolish investor.
What follows is a transcript of Molly's response to five emailed questions. She goes by the screen name TMFOperaRocks.
Kris Eddy: Why do you say investing is an adventure? Others might see it as more of an unpleasant chore, a pursuit reserved for the wealthy and the super-smart, or -- after the past couple of years -- a rigged game.
Molly Simoneau: I try to approach anything as an adventure. When I was a kid, I went on grand adventures down the rural road I grew up on to where there was a creek crossing. I would follow the creek, and search for arrow heads or bits of pottery. I'm applying that same attitude to investing. It's an adventure, because I'm really venturing into uncharted territory. I'm not kidding when I say that I've never done this before!
Eddy: How often do you check the prices of the stocks you own?
Simoneau: I'm not terribly anxious about the day-to-day movements of the share prices. I check once a day if I think about it. Usually in the morning. This is pretty easy for me, because I have such a tiny amount of money in play. We're talking hundreds of dollars. I add a little more money to the account every payday, if I have a surplus.
Eddy: You said in your blog that Disney
Simoneau: With Disney, I already took the first step, which was a day spent at Disney World in Orlando during a recent vacation. This was my first trip to Disney World as an adult (I visited twice as a kid), and I was really impressed by how efficiently they do things. I watched how they move people through long lines quickly, and how all the employees seem truly happy to be there, and I was amazed. It was almost too perfect!
So, the next step will be to take a look at the fundamentals, I usually focus on free cash flow, debt, and management. And then I'll do a discounted cash flow model, which fellow Fool Rich Greifner sometimes coaches me through. That is the part I hate, because I'm working with what really amounts to be made-up numbers. Sometimes it feels like an exercise in futility. ... And I hate math.
Eddy: Do you foresee yourself ever in a position to use more complicated investing strategies such as options, short-selling, and commodities trading?
Simoneau: You know, I don't see myself experimenting with those, because at this point I just can't make heads or tails of them. I've read some of the Motley Fool's articles on options, and I've had some very smart Fools try to explain some of these vehicles to me, but I still don't understand how you can make money on a stock as its share price falls. Right now, I'm trying to learn to walk before I run.
Eddy: What opera or song from an opera most represents your investing style, and why?
Simoneau: It's funny that you asked that, because beyond my Fool username, I haven't really said much about my love for the art of opera. The first aria (opera "songs" are called "arias.") that comes to mind is from Carlisle Floyd's opera Susannah. In the first act, the title character sings "Ain't it a Pretty Night," an aria that describes how she hopes to one day leave the tiny Appalachian town that is her home, and "see what's beyond the mountains." So, right now as an investor, I'm just learning. I suppose you could say that I'm trying to see what's beyond the Dow!
