The title of the post was actually to be a question, but I do not ask a question because after a question usually comes an answer. And I will not answer here how to learn to invest. Without questioning it makes me think that I will describe a process. I prefer to understand and try to explain a process than to find or give an answer.
Brazil is not a capitalist country (in fact). Most of our parents are not either. Brazil has 200 million inhabitants. More than 60% of Brazilian families are indebted. The National Treasury has close to 670 thousand individuals investors, bovespa have 550 thousand investors or, in one of the main categories that could invest well, not even 1% of the Brazilian population is.
It’s a good thing that another large portion is in the banks’ remittance (Personalité, Prime, Estilo, Vah Gogh and so on, I do not know the numbers, they are the biggest investors in the biggest banks – the rest of the people in the retail banks know and keep Money basically in savings) and as I said here the old guard likes, invested and only knows real estate as an option (and in fact was basically the only thing that existed) – since our currency has always been rotten, horrible politicians, And bankruptcy, they changed their name, they changed their owners, there was no computer (imagine the recording of paper assets in the bottom of a bank drawer – if it caused a fire or a simple loss it was, of course, complementary We are in Brazil, where the government owns and steals half of everything) The owner of 50% or more of Brazil’s wealth never moved to teach, help or stimulate the culture of saving or investing in Brazil, only with savings campaign Caixa and BB – treating savings as an investment, when in fact it is not.
For those who were born and raised in the 80s / 90s, there was no entrepreneurship, financial education, economics, personal finance, NOTHING in schools, whether public or private. Some lucky people had parents who taught them to invest, taught the foundations of commerce, the foundations of the family business or business, etc.
But in my case and in the great majority of the Brazilian people I do not think even the parents taught anything. This post I write for people like me, who have to learn everything from scratch, things that school, family or college have never taught, or tried to do, have done wrong. Not even what is money has been explained to us, nor how it is generated, what it means and what the value and ballast of a coin.
Nowadays I already know that some schools give classes in entrepreneurship, personal finance, and even investments, as we know it, which is great for future generations. We also have many more banks, the internet brokers advertising on TV (the case of XP) and much more information circulating, channels on youtube, online courses, many books of national and foreign authors you download hundreds of pdf of very good authors Right there in your house and for free) plus a HUGE assortment of assets to invest. We are in a good time, yes, to learn, to train, to reach out and make it happen. The scenery is well flowery. Now let’s go to the post:
How to learn to invest.
The first thing you have to know and accept is that you, like me, is an IGNORANT. No problem at all, we are all ignorant in 99.9999999% of the world’s affairs. Everything you know or have learned about anything in life is a trillionth fraction of the knowledge of humanity, and you become out of date with every passing second. If you want to learn something new be humble to acknowledge your own limitation and seek to improve on the subject every day, any matter, anyhow, plants a bonsai or make sushi, or invest.
Good news: Only with a PC and the internet will you learn a lot! MUCH! VERY MUCH!
You see, the title of the post is how to LEARN to invest. This is different from HOW TO INVEST or WHAT TO INVEST. You will learn by EFFORT, STUDY AND OWN MERIT. It’s like riding a bicycle, remember? NO ONE CAN TEACH YOU TO BICYCLE. You’ll have to learn to fall.
And the people who hold the bike while you pedal us, authors of books, writers, bloggers, YouTubers, entrepreneurs who share knowledge and etc … The most we can do is to say more or less as it is and give that encouragement. Here you can not give a ready answer, because deep down, what you want is different than what I want, as well as your background, family, desires, goals, longings, risk tolerance and more are different.
The question is, do you want to invest, have some money left, but wanted to learn a little more about how to learn to do this and to walk alone and always be learning more and more and FOR FREE or ALMOST OF FREE here is a brief account of how I did and how you could do too.
Books: Read the classics. I already posted on them here. I’m going to start with a series of book review posts I’ve read here. Read many books yourself. They are the best base, both for learning things from videos and other courses, to better navigate the internet and to understand the concepts. It is important to read books on finance and investments, from national and international authors. You can download 99% of them in pdf in English or even in Portuguese.
In addition to the classic books also read biographies and autobiographical books to better dive into the world of investment and finance. From the USA read all of Peter Lynch (it’s 3), read Benjamin Graham, read those about Warren Buffet, read those of Philipe Fischer, I’ve also been told that Damodaran’s are good, never read. If you want to go deeper into Buffet, read the letters to Berkshire Hathaway shareholders. Does Brasil buy and read Bastter books on the Amazon website? They are an excellent starting point.
Youtube: Bastter Channel. Put “Bastter” on youtube. There you subscribe to the channel and accompany both his videos and the moderators of the site are very good.
Subscription to magazines and newspapers: DO NOT NEED. DO NOT SIGN.
Sites: In Brazil, Bastter’s is what I like most to study stocks and investments in general. To see a little more Real Estate Funds I like the site fiis.com.br, some also talk about the Tetzner blog, but the content needs to pay to see and I think I do not need to pay for studying right now.
I would only pay if I had a lot of money invested in fiis because then fiis would be my business, and you have to know everything about your business (any business). The Bastter website has an annual subscription called Bastter Blue. I’ll sign it two years ago, I think it’s worth it. It’s the only money I pay for content in Finance.
I do not like Infomoney nor much less of the site and magazine EXAME, I think they do a disservice. I also do not like Empiricus, Toro Radar, I do not know what. There is a good site that is Fundamentus.com.br and another one that I like just to see a little more of the companies of bovespa is Guiainvest (the mural is crap). You do not need to sign Economic Value, Business Time, This is money these things, read from time to time on the net if it is the case and ready and very carefully, because these matters are paid and sponsored by the financial industry to push their products Financial industry is same cookie industry, all they want is to spawn the product of them on you).
There are also the personal blogs of Brazil that are on my main page. Every blog has the personal stories of the authors, or their investments or both, it pays to know each one and see what you can take advantage of there. This type of blog that made me create my own, I think it can add something in general. I was very fond of the Little Investor’s blog but it came out of thin air.
There are 3 gringos blogs that I am the very fan of which are those of Mr. Money Mustache, Early Retirement Extreme and Get Rich Slowly. The US has hundreds of blogs in the blogosphere, I’ve visited many but stopped at those 3 only.
From sites gringos I like MorningStar to study companies, Google Finance, Yahoo Finance, Market Watch, Guru Focus and the Boglehead’s forum.
See that it’s a lot to see and it takes a while, has patience, wander around for each thing and sees what pleases you the most.
Online courses: Coursera! This is the channel. I’ve done 5 finance courses there and I’m in one of UBS’s portfolio management and administration. Not that it will make any difference to your money, it has a purely theoretical knowledge, but if you have the time, like the subject as a hobby and want to deepen, here is a good, besides training your English too.
There’s a lot of stuff in Portuguese there, but not everything. It’s good because you understand how finance professionals work and how they act and can take advantage of this to your personal finances. The courses are free. You only pay for the diploma or if you want to go deeper into a specialization. It has app for tablet and mobile ios and android.
Brazilian brokerage courses: I do not know and never did. I do not like what they propose to teach a trade, graphic analysis, mini-index, options, and I do not know what else. These are all ways to make money by doing operations that I do not know and have no familiarity with and I’m not interested in having a day.
Investing through Funds: It’s expensive. They charge you money to buy Treasure Direct for you in the overwhelming majority of the time. Usually, they charge 2% fee that is expensive! I would only buy any fund or product in the world with a maximum of 0.5% per year. Past of that is practically a rape.
To give you an idea, if you pay 1% fee to a fund, in 10 years it will eat 10% of your equity. Beautiful is not it? And to pay 0.5% on anything else out there, it would have to be VERY VERY good, even exceptional. Stock funds you never know what you are doing behind. Fixed income funds have a thing called e-quota that ends with your money and basically only buy Treasury Direct for you and still charge you.
Actions: Learn by reading books and understanding the market. To study stocks I use the stock area of the Bastter website.
Fixed Income: Focus on understanding Treasury Bonds. Banking CDB buys Treasure Direct and resells it more expensive to you.
Real estate funds: Real estate are rented that you buy a quota and receive your proportionate share of the rent. I recommend an intermediate level of study to enter here.
Real Estate: Investment for those who ALREADY HAVE A LOT OF MONEY. Buy from the plant to “invest”: VERY RISKY! Your home is not an investment, buy the quietest possible pay (if you have early life), join a good entrance, pay the loan as soon as possible and get out of debt soon, or else you are calm in the Rent is adding money to buy a property to live in the front (and if you are sure that you will not move to a neighborhood or city).
Entrepreneurship, franchising, small business: Here I can not help much. I like Value Generation and Endeavor. The Value Generation has a site called meusucesso.com that charges a subscription, has classes to undertake and a social network of its own, is more focused on helping people to set up their own business. Seems to be the best thing of the genre I’ve ever seen. There are also online courses from FGV and Insper, but I never did.
Search for land, apartments, houses, and know more what to buy and resell: high costs, need for much money, danger of not being able to sell, or selling cheaper than bought, COSTS SINS with brokers, Prefectures, environmental fines, clearing and fencing the ground, IPTU, ITBI, invasion and much more bad things should be considered. And if you owe money to the construction company, they touch the terror in your life, sue you, put a bunch of lawyers behind you, protest at the notary’s office, and everything else. It’s a hell of a job for the builder because the sum is always high, the interest is extremely high and unpleasant, and you still have the chase with the legal apparatus behind you.
And now the most important: HANDS ON!
No use reading everything, watching the video, browsing websites and not participating. Open a brokerage in Brazil (if you do not already have one) and start investing. Do not invest in the bank or just by banks. Brokers offer you better things than banks, which pay you better and give you access to the stock exchange. It is walking that makes the way, the more you invest and put money inside you will want to learn and become interested, while you are away everything becomes very theoretical and meaningless. Without investing in fact, your learning is VERY LIMITED.
There is no rush or rush to buy anything, no stock, no fixed income and no real estate fund. Get to know the Treasury Direct soon (go to the Treasury website and read everything). The Treasury Direct is the King of Fixed Income, and most others are derived from it. If you want to start investing there do like the banks, they buy the so-called Treasure Selic, which is the most stable and yields the same thing as the Selic rate (currently 14.25% a year). From there you know more products and if you know how each one works, it seems complicated but it is not.
Understand that investing is a dynamic process. You will really learn by doing and fighting. Every day you will learn new things and unlearn old things, it will change your values, your concepts, your priorities, your certainties, everything! And this is highly exciting and stimulating because it greatly reflects your personal growth and maturity.
Assembling and managing a portfolio (stock portfolio, fixed income and real estate funds) is a very cool activity that I hope you enjoy over time, contribute money, receive dividends, sell shares of companies that have worsened, receive real estate fund rents, increase Allocation in Fixed Income, decrease such or such a company by stopping to buy it or selling it, get to know a real estate fund per month, meet a new company every month, read a finance book every six months, even create your own blog just like this , Exchange ideas on the net in forums, learn to declare their own income tax, invest abroad, dream about their financial freedom and make plans for the future, and more.
You really here are in total control of your life and you know where you are and where you are going. I would like this to be the reality of all Brazilians. We’d be a hell of a country if that were to happen one day.
So to summarize, to learn how to invest you will have to like the subject, or else you will lose money to the bank and fund manager. Enter the game, read books, open an account at a brokerage firm, start buying with little money to learn and as you become more familiar with the thing can increase values. Study fundamentalist analysis of companies.
In doubt always start with the fixed income in the SELIC of the Treasury Direct. Remember to always leave a reserve in the savings to pay for emergencies, NEVER keep your current account in the negative for not paying interest, if possible put the tickets in the automatic debit to not pay a fine. Pay your bills before investing. It is no use investing paying interest elsewhere, in the final balance you are always going to lose by washing if you invent to do this.
You will learn how to walk on the road by walking on the road. Prepare to lose a little money, regret small choices, rejoice over other choices, be surprised at other choices (usually on the positive side), get ready to adjust your initial plans, get ready to see the snowball growing, ready for the magic of compound interest, its calm, its peace and its tranquility increasing every day and the most important of all: GET READY FOR LIFE BETTER EVERY DAY.