

Ask HN: Where can I find some great resources on investing in tech companies? - jlgosse

Hey guys. I've recently been pondering the idea of investing in the stock market, but have no idea where to start. I figured at first I would be interested in investing in anything, but I think I would find it more interesting to focus mainly on technology companies.<p>I'm not too concerned with making huge returns or anything, but I would like to get my feet wet, and maybe earn a few extra dollars on my potential investments.<p>That being said, does anyone know of any good web sites with advice on the matter, or does anyone have any advice that they would like to share personally?<p>Thanks!
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tjr
I graduated from high school in 1998. My grandfather, wanting me to learn
something about business, gave me $500 to invest in the stock market. Java
programming was hip at the time, and I decided to put the money into Sun
Microsystems, resulting in ten shares.

A few months later, my grandfather passed away, so suddenly the stock wasn't
just stock, but was also his final gift to me. I watched the stock double in
value, go through several stock splits, and eventually my $500 investment was
worth around $6000. But, due to emotional attachment, I didn't want to sell.

The dotCom boom turned into the dotCom bust, and my Sun stock gradually sank
back down. At their request, in 2008 I mailed back my stock certificates as
part of their "reverse stock split", and in 2010 (just a couple of weeks ago)
I received in the mail a check for $190 from Oracle Corporation, as Sun is now
no more.

Had my grandfather been here, he surely would have advised me to sell the
stock when it was valued in the thousands of dollars, and had I known that in
the end the stock would be reduced to a check for $190 from a different
company, I reckon I would have decided to sell it myself.

So what did I learn? Don't get emotionally attached to a stock, or to a
company, or to anything of that nature. Companies come and go. If you can make
the world (or even your little piece of it) better by selling a stock, then
consider selling it. The memories I have of my grandfather are far more
precious to me than the stock, or the $190, or the potential for $6000, but I
let emotions (and maybe a bit of stubbornness) persuade me otherwise for a
decade.

Deal with facts. Find out what the company is doing and planning to do. Find
out how well the company is managed, and if you do buy stock, keep up on how
well the company is managed. If it looks like some new CEO is going to drive
the company into the ground, that might be a good time to get out, even if the
company is still making some cool product that you like.

For me, I tend to shy away from buying individual stocks now. There is great
potential for great success, but there is also great potential for great
failure. I like to think I have better odds at becoming wealthy by creatively
working hard rather than by picking stocks, so most of my stock investments
are spread across a variety of funds. Even those can turn sour quick, but in
most cases, not as sour as quickly as an individual stock can.

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jakarta
It depends on what kind of tech company you are talking about.

A Microsoft will have a fairly understandable business model with predictable
cashflows. Conversely, most young, public tech companies are more of a gamble
on management teams/product being able to execute their plan and grow. That to
me is something you wont learn in books and pick up on with experience. And
always remember that just because a product sounds good, or is good, it might
not necessarily be a good investment. You are buying a stake in a business and
if you pay too much for that stake, you decrease your margin of safety.

