This is part of a series of profiles highlighting women investors in the Fool community. Find out what makes the fairer sex better at picking stocks at fool.com/girl.
There are nearly as many different paths to investing success as there are investors. For cartographer Sara Wetherbee, 56, success has come through relying on her judgment to find people she can trust to give her sound investment advice. Read on to learn more about Sara -- or PhoolishPhox, as she is known on the boards.
How did you get started investing?
I was aware as a child that my grandfather owned some stocks. My father began investing in the mid-1980s after he inherited some money from relatives. He owned mostly mutual funds from T. Rowe Price initially.
My first foray into investing started in the mid-'90s, also via several conservative mutual funds. I chose a T. Rowe Price fund, mostly because my father had done so. I thought the big horn sheep logo was cool. I really had no substantive understanding of the stock markets or individual company fundamentals. I did understand and appreciate that mutual funds mitigated the risk of individual company failures, and I bought different kinds of funds to further diversify. I guess you could say that I was risk averse, although I was probably being more cautious, and less focused, than I would have had I known a little more about different kinds of equities. In 2007, I became interested in owning individual company stocks, partly because of NPR interviews with [David and Tom] Gardner.
How would you describe your investment approach?
I'm inclined to let experts pick stocks for me. I rely on observation, instinct, and interaction to help me find a service I can trust. I enjoy owning companies that are innovative and have attractive brands, and whose products and services I use or experience personally. I don't want to own companies that are environmentally or socially reckless. [Motley Fool Pro advisor] Jeff Fischer and his staff seem to avoid those kinds of companies.
I like to own a mix of companies of varying sizes, some that offer potentially big growth, others that may be slower movers but stalwart during difficult periods. I am relatively risk-averse but I'm inclined not to panic during market downtrends or if one of our picks heads south for no clear reason. My main rationale in switching to Pro was to learn how to use options to preserve capital and earn income in bear markets.
Any notable investment successes or failures?
Chipotle
As for failures, there were several stocks that I purchased in 2008 that tanked. Overall, Allied Irish Banks was probably the worst.
In our upcoming book, Warren Buffett Invests Like a Girl, we make the case that women are better suited temperamentally to be great investors -- they are generally more patient, take less risk, stay calmer in turbulent markets, do more research, and hold for the long term. Do you think you invest like a girl?
I think women are more forgiving if a company doesn't exceed expectations as quickly. After all, we are designed to be nurturing, and not quite so prone to requiring instant gratification (unless you are talking chocolate!).
When I began investing in mutual funds, I had a good feeling that telecommunications was going to be a good sector, so I invested in a telecom-focused fund. I remember a conversation with an older gentleman, an experienced investor, who made it plain that I had no idea what I was doing. Our conversation had me seriously questioning whether I should continue to hold the fund, but through good instinct, luck, or pure stubbornness, I held onto my shares. It took some time, but the fund did quite well.
Finally, what stocks are you buying right now?
I'm following Motley Fool Pro recommendations closely and not buying anything outside of those, although I still hold a few stocks from previous services. Most of my discretionary income goes into a retirement 401K, essentially a basket of very-low-cost index funds. Not sexy, but the tax and overall cost advantages would be difficult for any Motley Fool service to beat.
Want to learn more about how to invest like a girl? Warren Buffett Invests Like a Girl is available June 21, but you can get chapter one today for FREE.
