How I invest and grow my fortune: Focus on a growing monopoly in the growing market
My investing seems successful for many years. Today I share my investing philosophy and simple investing rules.
I am in Millennials that is often thought to experience the hard economy and in fact I spent hard time in early years from graduating the university. I didn’t have the financial or economical academy background so the first 2 years of investing was not good and I gained so little money.
I am outside US and couldn’t write or even read English several years ago (so I know this article may have some word bugs). Naturally I invested in my country’s stocks in the first but its result was not great. I questioned why the stock price of what I had invested didn’t go high and studied the finance and economy. I read so many books like Market Wizard. A year later, I found the reason why I failed:
- All companies I invested don’t grow
- because the markets they are in are so crowded
Then I also noticed I had used Google so many years. Google grew as a monopoly because Bing and Yahoo! couldn’t compete Google in the search engine market. The Google search engine was clearly best and the links Bing or DuckDuckGo made often seemed weird several years ago.
The price of Google had gone up uninterruptedly since its IPO and I was so surprised at seeing the chart.
Google is absolutely a monopoly acting a weak non-monopoly company so Google can decide its ad cost (AdSense) and revenue (then AdWords). Its pricing power is so important.
Next month, I searched several markets and found out monopoly companies; Apple, Microsoft, Facebook, NVIDIA, Visa and Tesla. These are monopolies and growing in the growing market.
OK, the tobacco companies are kind of monopolies but the market has been shrinking because we don’t want smoke. So the stock prices of them are flat. A monopoly in the shrinking market tends to pay good dividends instead of investing the core business.
“Monopoly” and “growing market” create a hyper growing company. The search engine is growing and Google is a monopoly so Google is a monster company.
I only invested in monopolies
I created the US investment account after studying the US stock market.
Then I invested in Tesla, Apple, NVIDIA so heavily. A few years later, the stock price of Tesla went to the moon. Apple and NVIDIA also soared. I still have them.
I’m very bullish on NVIDIA because it is a monopoly like Google. I was a gamer and knew so many gamers used PCs with NVIDIA GPUs. AMD’s GPU is also nice and I love it. But NVIDIA’s chips are used by professional gamers and YouTubers, crypto miners, and machine learning engineers. As a Python engineer, I deeply understand the difference between NVIDIA and AMD. In the growing GPU market, NVIDIA looks like a monopoly as Microsoft in the PC market.
(Of course, AMD is a very good company and many gamers and miners love AMD chips. I’m bullish on AMD and I’ll show you the reason why I like AMD next time.)
Tesla and Apple are so similar and unique unlike NVIDIA. They are the first movers and leading the emerging market but there has the competition. Apple’s Microsoft or Google is Tesla’s Ford or GM. But I think Apple and Tesla are monopoly-like companies because of their premiums that too many fans are willing to pay. This premiums come from their monopoly-like behavior.
The smartphone and computer are commodities but iPhone price remains so expensive. This is because Apple creates not only smartphones but also beautiful designs and the closed network connecting Apple devices. In this perspective, Apple is so similar to Facebook that connects Facebook, Instagram, Messenger and creates the closed “the second web” that Google can’t compete.
Apple grows in the growing tech device market and Tesla grows in the growing EV market. A great company creates a new market and the market grows up the company.
After investing Apple, I invested Google, Visa, PayPal and Square. All of them resulted in the huge capital increase. The summary of this article is that:
- Find a growing monopoly in the growing market
- Then, buy the dips of it
This is what I have learned from my past loss. I created Twitter account yesterday and will tweet what I have studied in investing everyday so follow me RollingStonk with hamburger icon in Twitter. I hope all of us get money and happy lives.
Disclaimer: I am not a financial advisor and past performance is no guarantee of future results. Investing and trading involve risks.
