Intro

For us mere mortals, the world of financial markets is a daunting & unchartered territory. The sad reality is that the education system will never equip you with practical skills. Instead, you learn theoretical concepts that you will most likely never apply in the real world, I for one am still patiently waiting for the day I get to use Pythagoras theorem.

As a result, most of us let our money to sit in the bank, gradually losing value, whilst the financial savvy invest and accumulate wealth.

The hope is that, before you splash your coins on a new car that begins to lose value the moment you drive it out of the dealership, or £830 Christian Dior sneakers, you realise that there are ways to make your money grow and work for you.

Let’s put things into perspective

Apple stock was trading at $201 per share exactly a year ago and today it trades at $372 per share (at the time of writing).

With $830 you would have been able to purchase 4.12 shares, and today you would have $704 profit (85% return). With your original investment you would have $1,534 – Now that is VALUE.

With the use of leverage, you would be able to increase your buying power by up to 5 times and earn greater profits (or losses).

Now if you had waited a year to buy a new car and bought Apple stock….do the math.

*To calculate profit or loss:

Change in share price x number of shares you own = Profit or Loss.

The value of shares can go up or down, and past performance is not an indicator of future performance. So yes, you can lose or make money, but what’s life without a little risk.

A small caveat, the example I gave above is in hindsight, meaning a year ago, no one knew this is how Apple stock would perform in the future, in fact, no one knows whether a stock will go up, down, sideways, or do cartwheels. However, the biggest driver of asset prices is GDP growth or rather, expectation of GDP growth – something called living in the future (we will discuss this further in the Macro 101 blog post).

In the upcoming releases, we shall dive deep into the world of Stocks, Bonds, Currencies, ETFs, ESG Investing – confused already? Fear not, you have come to the right place.

In the words of Jared Venett from the Big Short movie, “People in finance like to use words that confuse you to make it seem like they are the only ones that can do what they do”.

Therefore, this blog will endeavour to explain seemingly complex financial and economic concepts in plain English, using everyday examples and analogies.

See you on the other side,

– Adonis