Emma Morton has a story many investors can relate to. She got caught up in the hype before being bruised by reality.
The 25-year-old investor put money into artificial intelligence technology company Brainchip (BRN: ASX) in September last year.
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She got caught up in the FOMO, she told Yahoo Finance.
Then, when the company’s share price halved within three months, she lost $500.
For the first-year doctor, the experience reinforced two important rules.
Don’t get caught up in the hype.
Don’t invest more than you can afford to lose.
While she failed the first rule, she was glad that she had followed the second.
Here’s how she invests today.
Cryptocurrency and equities
Morton invests in cryptocurrencies and equities through micro-investing platforms and cryptocurrency exchange Binance Australia.
She decided to begin investing as she knew she was about to start working full-time, and wanted to make sure her money was working too.
“I would definitely say I’m conservative. I don’t sell much and I take my time to buy. I take my time to do my research,” she said.
People are often surprised when she tells them she invests in cryptocurrency but considers herself conservative.
“I think that’s because a lot of people don’t understand how it works. I’ve definitely done a lot of research,” she said.
“If you really understand cryptocurrency, it’s not as scary as everyone thinks. The one thing that really fascinated me about Bitcoin is that it’s a currency that’s designed to increase in value.”
Every four years, the reward for mining Bitcoin halves and that means that the amount of Bitcoin miners receive for every verifying transaction is 50 per cent less.
That’s going to happen until 21 million Bitcoins have been mined, and essentially they act to limit supply and increase prices.
To Morton, this was a compelling reason to put a bit of money into the famous cryptocurrency.
However, she also uses CommSec to invest in exchange-traded funds, or ETFs.
She chooses ETFs as they allow access to a range of stocks tied to a theme or index, and as such are considered a safer and cheaper way to diversify your portfolio.
Morton tracks her investments every week or so and tries to put aside 20 per cent of her pay packet to invest every two months.
But she’s firm on playing the long game, something her father taught her when she was 15.
As a teen, she saved $2,000 and then her dad helped her invest in four well known firms.
She chose Westpac (WBC.AX), BHP (BHP.AX), Woolworths (WOW.AX) and AGL (AGL.AX).
“AGL hasn’t done amazingly,” she admits, but the rest have.
Woolworths has gone from $18.71 a share in July 2011 to $42.57, while Westpac has gone from $17.44 to $26.15 and BHP from $34.04 to $47.35.
AGL has gone from $16.55 to $9.14.
But don’t listen to what I say, do your research
While Morton has experience investing across ETFs, cryptocurrency and individual equities, she considers herself far from an expert.
She’s constantly listening to podcasts and reading up on her investments and themes she’s interested in following.
She suggests others do the same.
“Don’t just buy Bitcoin because I did it. Really do your research.”
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