When my dad found out I was an English Major, I received a pissed-off prophecy:
“Listen to me carefully, you silly writer-artiste: a man can leverage money, or a man can leverage time. And you need to learn how to make money with your money because Lord knows you won’t be making money with your time.”
He earmarked a week to yank me out of college to force this education aboard a cruise in the Caribbean.
“Here’s the deal: I pay for your cruise, you pay for your drinks… and listen to me lecture on the stock market for an hour every day.”
"Sardini Swigs Martini"
So it went, and by the third day I had everything I needed to get started, ticking the basic “To Buy” boxes of the first stock I’d ever own.
“What To Buy: Strong management. Weak competition. No debt.”
My dad applied his principles to Canadian oil and gold stocks (with staggering success); I applied them to a Japanese toy company…
“When To Buy: Imagine you are holding a financial newspaper containing every public company. Find the one on Page 16 that will one day hit Page 1.”
…Nine months before Nintendo’s Wii came out.
"Grouper Mario"
“Where To Buy: I’ve had no problems, so use Scottrade. Don’t screw this up and put this off: setting up your own account takes five-hundred dollars if you’re poor and six-hundred seconds if you’re slow—not a heroic price to pay considering it can change your goddamn life.”
More than eighteen years later I can tell you that if I had not skipped that week of school my education would have been wasted, because I could not have made enough money to buy enough time to pursue—with force—what I had studied.
“How Much To Buy: Concentrate to create, when you’re a young man, because you have time to recover if you’re wrong. Diversify to protect, when you’re an old man, because if you lose your nest egg you are fucked.”
When I got back to campus, with my newfound skill and sunburn (and a comically oversized rum bottle I’d picked up duty free), I took my money out of the hands of a Harvard MBA three times my age—who invested it intelligently but conservatively, since he was smart and sixty—and put it all into Nintendo (NTDOY).
“Are you… sure?”
"Codnundrum"
How much I didn’t know then continues to amaze me and amuse me.
When I noisily announced my decision and stock prophecy, most of the people in my orbit assumed I was insane.
That’s because I did not know:
One hour of financial history
One ounce of economic theory (beyond Econ 101, which was of no use to me at all)
What market NTDOY traded on
How buying stocks helps companies
How Wall Street operates as a competitor
Even my own father, my own stock sensei—a Marine fighter pilot in Vietnam, a Wharton Accounting MBA, and a former hedge fund founder—seemed to harbor the suspicion that, despite his best intentions, and despite this intervention, he had somehow just invented a more incompetent monster.
“But what’s Nintendo’s P/E ratio?” he’d ask, on edge, as I got all worked up on the Wii—“It’s gonna be the iTunes of video games!”—while we downed Irish coffees in the casino of that cruise ship.
"My Sunfish is a Clownfish"
It made no goddamn difference. This ignorance was irrelevant.
I had what I needed to get started and watched my stock quadruple over the next year and a half (in April 2006, NTDOY was at $18; in October 2007, it crossed $76).
Then I took my profits from Nintendo and—using the same stupid-simple principles and almost zero time commitment—rolled them into Google and Apple during the recession, then into Netflix as they transitioned into streaming (then into other winners that are sitting in your kitchen).
"SimpliciWii"
But this first investment experience was worth so much more than money—be it right-now money or even funds for short-term freedom—because it gave a permanent promotion to my perception of what’s possible.
I now saw that opportunities are everywhere—and now knew the simple steps, once spotted, to smack them to the rafters.
I now grasped that all you had to do, to make meaningful money in the market, was understand a single company—not the world’s economy, not financial theory, not monetary history—tick my basic “To Buy” boxes, then back that fact-based faith with real money.
I now knew how to take a smallish sum—which might otherwise be blown on bars, or impulse-buys, or a three-year stimulant supply—and set myself up to not need anything from anyone, earning income independence without so much as a job, or even a hobby.
(Because where hobbies require mostly doing something, successful investing requires mostly doing nothing.)
"Carp Diem"
Of course, in line with another of my father’s power maxims—“You don’t know shit about your subject or yourself until you’ve been through a Bull Market and a Bear Market”—I’ve suffered short-term setbacks.
But if you’re in this for the long haul, the wins will dwarf the losses.
Entering my nineteenth year of independently investing, this game moves in slow motion: I've had multiple stretches where my focus investing strategy has cleared or flirted with a 1,000% return (in 2-4 years, in my spare time, creating unadulterated freedom without taking undue risk); according to theory (which says doubling your money is supposed to take seven years), what's taken several years to accomplish should've take more than half a century.
More importantly, I have helped people––most ages, all genders, in many geographies––pick their own stocks & invest their own money so successfully that they've shaved years, and sometimes decades, off of their retirement trajectories; calming their minds then changing their lives by investing as a hobby.
When in doubt, remember the simple moral of this $tory:
I learned investing in one week on a cruise ship. The fact that I can do this means that you can do it too.
-Cole
PS: Want me to do for you what my dad did for me? Watch this presentation.