"Don't love stocks -- they're just pieces of paper."
-- Jim Cramer
I respect Jim Cramer a great deal, and in some ways I agree with his statement. At The Motley Fool, we also recommend that you don't fall in love with your stocks to the point where it prevents you from objectively evaluating the fundamentals of the business, or selling the stock if those fundamentals begin to deteriorate. And controlling your emotions is often one of the most difficult, and most important, parts of investing.
However, I'd like to offer a different take. I suggest that you seek out investments where you have an affinity for the company in which you invest. Seek out and purchase stock in companies you're proud to own. Companies whose products and services you love, with management you respect and even admire, and whose stock you feel like you just have to own a part of just so you can take part in the company's spectacular success.
The reason is that investments in these types of businesses can literally change your life.
Let me give you an example.
Apple (Nasdaq: AAPL) is a business that I have long admired. In business school, it seemed like Apple was used as an example for best practices in almost every business function. The company has an excellent management team, even after the loss of arguably the world's best CEO. As for its products -- I recently purchased my first iPhone, and I believe it is an amazing device. And an iPad seems like a sweet stocking-stuffer for that extra special someone in your life. (Hear that, Santa?)
I simply wanted to, in some small way, take part in this tremendous company's phenomenal success. Dare I say it -- I was, and still am, proud to have owned shares in Apple.
Let's rewind a few years. In mid-2006, I was out of the market because expenses (also known as "my wife's engagement ring") had forced me to sell my stock investments. But one day I was watching CNBC and noticed that Apple was near its 52-week low at about $50 per share. I had recently read how Apple had reached a deal to use Intel (Nasdaq: INTC) processors, which gave Apple's computer the capability to operate Microsoft's (Nasdaq: MSFT) Windows-based software much more effectively. I knew this would be huge for Apple, and it didn't make sense to me that the company was trading near its lows for the year. So I added the company to my watchlist and began researching the stock. A few months later I invested in Apple.
I also rated it an "outperform" in Motley Fool CAPS. At the time, CAPS was a cool little stock-picking tracking service created by The Motley Fool. Now, it has more than 180,000 participants.
Fast-forward a few years. It was early 2009, and the market was at decade-low levels thanks to the housing crash, credit crisis, Great Recession, and this song.
Apple was trading at about $85, and some genius analyst had just downgraded the shares. At the time, my portfolio was taking a beating. I was down more than 50%, along with the rest of the market. It was at this time that I decided to sell my weakest stocks and move the money into the companies that I had the most conviction in for the long term. (In hindsight, this is what I should have been doing all along!) One of those companies was Apple.
Fast-forward a few more years. My family's portfolio is now solidly in the black and has risen more than 300% from the March 2009 lows. Most of those gains were from Apple.
Apple is also one of my best-performing CAPS picks and has helped me earn a top 1% ranking. But here is the really life-changing part: Apple helped me land my dream job. Here's how: Apple basically brought me back into investing. Back in 2006, I really didn't have enough money to invest in the stock market, but I believed Apple was simply too good an investment to pass up. I had to own the stock. Soon the research I was doing on Apple led to research on dozens of companies, which led me to study economics, accounting, and personal finance. This ultimately led me to pursue (and complete!) a degree in finance. My research also led me to a little job posting for The Motley Fool's Analyst Development Program. I have no doubt that my investment experience, countless hours of studying, and CAPS performance helped me get hired by the Fool. (Yeah, baby!)
I've been reading articles on Fool.com for more than 15 years. And now, thanks to investing in some stock in a little company named Apple, I am a Motley Fool analyst and writer.
Not bad for just a piece of paper.
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