Doing Your Own research

 Yep, everyone says it: DYOR - do your own research. On the company you want to invest in; on the sector that the companies lies within; on the share market itself; on the politics of the country the company resides in; on what is happening in the world generally.

Most often, the best investment you can make is in research, and that includes in researching what you are actually doing - in other words, reading books, attending online classes, going to real world classes, asking questions - all in an effort to better understand the market you are in and the dynanics of that market.

Remember that the goal is to maximise profits and minimise losses. And so all learning is good learning.

If you don't know how something works (say, for example, you don't know anything about short selling, and the whole idea just worries you) then get hold of some information (books, courses, etc) and educate yourself. You may never even use that information directly (or you may get excited by it and jump into a new field), but you may find you can use that information indirectly to give you an edge.

Let me give you an example.

I am one of those who had very little idea about short selling (yes, I have seen the movie The Big Short), so I bought a couple of books on it and read them.

Let me tell you up front: share market books can be very information-dense and will often take more than one reading for the concepts to stick. But they are useful. BTW, I also read a coule of William O'Neill's books on charting and read about candlesticks - all really useful stuff.

But it was the shorting information that made me explore more.

So I logged into the ASX website (I assume other exchanges have a similar service) and discovered that they have a shortng report. Just exploring, I took the first company on the list (1AI) and thought: why is it being shorted? Let's find out.

So I punch in the code and look at the company and its presentations and reports and I find that actually, it is an opportunity to buy shares in (ie NOT short) in about 4 months time. There looks to be a quick opportunity to make a profit in the third quarter of 2024.

Notes went into my notebook to check back in mid-June.

And I now have a whole new tool that no one has ever told me about. I am sure I am not the only one doing this, but the principle of "what goes down might come back up again" means that I can now look at what is being shorted to find future opportunities to buy shares in and can set up a calendar of opportunities.

All by connecting disparate dots that don't often get connected. All because I did research and let my brain run free.

So never stop learning, never stop doing your own research.