Taming Wall Street’s golden bull
MIKE McGEE | 8/4/2017, 6:21 p.m.
“When it comes to the Black community and women, we really need to step up our game and be able to take advantage of a lot of those opportunities that are out there for us,” Gray said. “And to have someone like Mr. Davis come out and share his expertise, his knowledge with us, that’s just added value to our purpose. You know, part of our mission is to educate.”
Sheena Clark, vice president of the Young Professionals, agreed.
“There’s never too much to learn. There’s always room for growth. Always. And I say take as much as you can. You can never have too much knowledge,” she said.
As the workshop continued, Davis attempted to diminish some of the misgivings a potential new investor might have.
“What do you do if you buy a stock and the price goes down?” he asked. “You lose money on paper, but if you don’t sell it, you don’t actually lose money until you actually sell it. If it goes down in value, what are you going to do? Do you have the nerves to wait? If you bought a share at $80 and it goes to $70, what are you going to do?”
As the audience weighed options about the scenario, the speaker segued into his next point.
“One of the things about buying individual stocks [is] you have to come up with a strategy,” he remarked. “What is my goal? And that goal could be, ‘OK, if it goes down 20 percent, then I may get out of it – or if it goes up 20 percent, I may want to get out of it.’”
“Stock prices fluctuate throughout the day,” Davis affirmed. “Not only on a day-to-day basis but even through the day. [They will] give you one price in the morning; it’ll be $4 higher in the afternoon.”
This is why a strategy would be important, he noted.
“In most cases, if you invest in long term purposes – and long term being four or five years, or longer – then you can watch it go down, then you can just watch it go back up.”
However, this strategy means studying the trends and risks of the invested company, keeping an eye on the overall economy, considering the activity in Washington, D.C., and diversifying a portfolio with a variety of stock, the speaker emphasized.
“Are you familiar with Enron, down in Houston? They were basically cooking their books.” Davis mentioned how he worked with a regional company and went to one of their presentations.
“They said they’d never invested in Enron because they could never understand what kind of business they were,” which lead to a further lesson on diversification.
“A lady in Houston, after that, she’d worked at Enron. She had her entire 401K planned in Enron stock, and at one point she had $400,000. When she left Enron, she had zero. Zero dollars because she had all her eggs in one basket,” he confirmed.
There was no specific mention of when Taming the Gold Bull Part 2 might occur, but Clark stressed that such education programs would continue.
“I feel like, each one, teach one. What I learn here I can take to someone else.”
The vice president underscored how important it was her for to continue passing on such knowledge.
“I just feel like this is stuff that is not taught in school. It should be taught in school because when they get out into the real world they need to know this stuff,” she added. “Stock was never even mentioned in high school and I took a business class – and they never mentioned stocks.”