BIO: Patrick Huey is a CERTIFIED FINANCIAL PLANNER™ professional, Chartered Advisor in Philanthropy®, and an Accredited Tax Preparer.

STORY: Patrick bought a technology stock based on rumor and peer recommendation. He didn’t do any research and the stock ended up losing value.

LEARNING: Don't just come into an investment seeking an investment, seek an outcome. Overestimate your risks and underestimate your gains.

 

"Overestimate your risks and underestimate your gains."Patrick Huey

 

Guest profile

Patrick Huey is a CERTIFIED FINANCIAL PLANNER™ professional, Chartered Advisor in Philanthropy®, and an Accredited Tax Preparer. He earned a bachelor’s degree in History from the University of Pittsburgh, and a Master's in Business Administration from Arizona State University.

Patrick served nine years as a U.S. Naval Flight Officer earning the Strike Fighter Air Medal during combat operations and two Navy Achievement Medals.

He is the author of History Lessons for the Modern Investor and The Seven Pillars of (Investment) Wisdom.

Patrick specializes in creating financial plans, generating a retirement income stream, and managing investment strategies. Contact him for help growing, spending, and gifting your wealth.

Worst investment ever

When Patrick got a stable income, he started talking and listening to some of his friends about stocks. He figured they were a heck of a lot smarter than he was, so he listened pretty intently. Then Patrick bought a high-flying tech stock based on his friends' advice. At the time, Patrick could only afford to buy one stock at a time and added to his portfolio when he could.

Patrick created a highly volatile, barely diversified technology/Internet stock portfolio. He did no research and bought the stocks on rumors and recommendations from a peer group. He thought nothing about risk mitigation or even his tolerance for loss.

Patrick was pretty sure at that point that he was an investment genius and would retire early on an island somewhere. Then the market started to slide, and he figured he was just going to add to the position. Then 911 happened, and Patrick got pretty busy. After 911, when he finally checked his account, his 10s of 1000s of dollars had turned into a few 100. He eventually sold that stock and just moved on.

Patrick got smarter about money and understood that you don't amplify your mistakes by continuing to buy something that has no earnings, no business model, no profits, no nothing. And to also diversify his portfolio.

Lessons learned

• Don't just come into an investment seeking an investment. Come into an investment seeking an outcome.
• Overestimate your risks and underestimate your gains.
• Personal finances are just that; personal. So forget what your friends are doing.
• Educate yourself about investing.

Andrew's takeaways

• Just following other people and not doing your research ends up in disaster.
• We do not create wealth in the stock market. We grow wealth in the stock market.

Actionable advice

Understand how you think before you can think clearly. Keep emotions out of investing.

No. 1 goal for the next 12 months

Patrick's goal for the next 12 months is to be a little bit better at something every single day.

 

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Connect with Patrick Huey

• LinkedIn
• Website

Andrew’s books

• How to Start Building Your Wealth Investing in the Stock Market
• My Worst Investment Ever
• 9 Valuation Mistakes and How to Avoid Them
• Transform Your Business with Dr.Deming’s 14 Points

Andrew’s online programs

• Valuation Master Class
• How to Start Building Your Wealth Investing in the Stock Market
• Finance Made Ridiculously Simple
• Become a Great Presenter and Increase Your Influence
• Transform Your Business with Dr. Deming’s 14 Points

Connect with Andrew Stotz:

• astotz.com
• LinkedIn
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• YouTube
• My Worst Investment Ever Podcast