Wednesday, October 10, 2007

Google Pure

The title of this blog is a misnomer. It is not about my opinions of Google. I have many opinions about Google, but you wouldn't be interested in any of them. This blog is about a long-distance runner in Google. It's about me.

I'm not young and I'm not rich. Four years ago, I retired, but returned, as a contractor, to my old job. My pension is secure and I can almost live on it, but my contract job gives me something I never had before - free cash flow.

I'd never been in business and I knew nothing about economics or markets. I decided to manage my own money.

In the spring of 2004, I added a brokerage account to my portfolio. I subscribed to Cramer. I started trading stocks. I had traded stocks briefly in the sixties, when I was in my twenties and lost $18,000 from excessive margin calls.

Now, I was older and wiser. I diversified. Some of the stocks I bought went up and some went down. Some of them went up and then went down. Like NYX. I don't own that anymore. In fact, I don't own anything anymore. Except Google.

I bought a hundred shares of Google in 2005. Actually, I bought 10 shares, and then I bought 20 more shares, and then I bought 170 shares, and then I sold 100 shares. From all these transactions, I booked a profit of about $200.

The 100 shares I had left cost $189.59 each. When they doubled, I quick sold 50 shares for $366. The stock never again fell below that price.

I held fast my 50 remaining shares. Every time Google went up a dollar, I was fifty dollars richer. I calculated my net worth constantly. I was pitiful.

I put the bulk of my money into mutual funds. I became conservative in my mind. But deep down I knew that I only had 50 shares of Google. And I knew it was wrong.

On May 24 of this year, everything came to a head: I sold all my individual stocks - msft, erts, adbe, stx, gern, jdsu and wtr. With the proceeds, I bought 261 additional shares of Google at an average price of $478. My net cost basis, including the original 50 shares, was $437.

But I didn't stop there: I sold all my mutual funds and put all the proceeds into a money market fund. I wanted to be Google pure.

Today, Google closed at $625.39 and added another five dollars in the after hours. A gPhone has been sighted. A sense of acceleration is in the air.

No comments: