Founder & CEO, Invessential
How did you get into investing?
I was influenced about finance and investing from a young age as a way to compound wealth and avoid financial struggles. At the age of 8 I sent a letter to prominent investor Warren Buffett looking for advice, and received a reply encouraging me to study, read, and form good habits. Throughout my childhood I read articles and watched videos online to build upon my investment knowledge, learning new strategies and risks of the stock market.
Why do you think it's important to start investing early?
Investing is really the idea of delayed gratification: sacrificing now for larger gain in the future. By investing a portion of earnings now instead of spending, you can set yourself up for financial independence, stress-free retirement, and wealth down the road. To provide some real numbers, the US stock market (represented by the S&P 500) grew by about 10.78% annually on average between May of 1971 (~50 years ago) and May of 2021. $10,000 invested in the US stock market in 1971, with no additional contributions, would be worth a massive $1,671,352 today.
What was your first investment?
I made my first investment in Bank of America ($BAC) back in early 2016. The company was yet to recover substantially from the 2008 financial crisis, and they had backing of strong fundamentals – which attracted me to the stock. Since then, it has compounded at about 21% annually, representing a 3x return excluding dividends.
3 Steps to Analyzing a Company's Dividend
Income investors love dividend stocks, but not all are attractive or safe. Knowing the ins and outs of a company’s dividend before investing is crucial for any dividend stock – especially for established businesses who distribute a majority of profits.
by Vineel Bhat, 6/28/21
The edge individual investors have over institutions
92% of mutual funds underperformed the S&P 500 in 15 years. But this doesn’t mean picking individual stocks is a pointless endeavor: retail investors have numerous advantages over institutions, and may have a better chance of beating the market.