Waiting

I have applied for an account with Zecco.com an online brokerage that has 10 free trades a day and 40 free trades a month. I have been wanting to start an investment company for a while and this will give me low fees so that I can practice until I have some investors. I have to wait until I receive the signature page in the mail and then send it back with a photocopy of my driver's license.

It has been almost a week since I signed up. Zecco is located in Canada so I have may have to wait longer than domestic mail.

In the meantime I have read a few books. I first read The Richest Man in Babylon,which after you get use to the dialog, is a very good book.

The other was Buffettology: The Previously Unexplained Techniques That Have Made Warren Buffett The Worlds. There is a new edition out, The New Buffettology: The Proven Techniques for Investing Successfully in Changing Markets That Have Made Warren Buffett the World's Most Famous Investor. I may see if the library has the new edition because it adds a new filter to the analysis. I got the old edition because I received the book through PaperBackSwap.com and it was free.

Anyway, Buffettology had a huge impact on me. I would love to do this in the future. I need capital, which I can get in 4-5 years from my future rich doctor, business, and scientist friends. So, for the next 4 years I will save about 10% of my income and try my hand at security analysis. I will probably take a few classes on business finance and others, but I have no plans to get a MBA or anything like that.

The only problem I have with the book is the quantitative section. They seemed to try to make it too simple and it was hard to follow. When you try to explain an equation write it in paragraph and then put it in equation form in its own paragraph.

equation + organization = understanding

Using the techniques described in the book, I set up a Excel spreadsheet analyzing The Coca-Cola Company's stock (KO). I had trouble at first but I got all the analysis done and calculated the future earnings per share and the future value of the stock. Of course it looks good because it is Coke.

I will also be checking out the book Security Analysis from the library in the future.

Updates will be coming. I will in the future publish my monthly net worth in the middle of the month so that my pay checks are spread out. I will also be putting in a format that will be similar to income statements, cash flow statement, and balance sheets. I will be learning how to read these better and there is not better way than doing one yourself.