Chris Brycki was just 10 years old when his father introduced him to the concept of shares.
Yahoo Finance.” data-reactid=”33″”He explained that you could buy a piece of a business,” Brycki told Yahoo Finance.
“He used examples we knew of… We go to Woolworths to buy our groceries – you can own a piece of the shelf.”
A young Brycki thought it was fascinating that anyone could own a bit of a real company operating anywhere around the world.
As a demonstration, his dad granted Brycki and his brother $1,000 each that he would invest on the boys’ behalf.
Brycki then started reading the finance news to see what he might like to buy.
He was soon hooked.
“I bought into a resource company, and I think my brother actually did buy Woolworths.”
Brycki kept a meticulous diary of his buying and selling, and the stocks he was interested in.
And according to that log, Brycki owned shares in Savage Resources for five months in 1996, before selling it for a 23 per cent profit.
“When I eventually told my dad to pull the trigger and sell, I thought I was pretty smart – because I locked in a profit due to all my fantastic research,” he said.
“Little did I know that wasn’t why I made money – it was mainly just luck. But it was a good way to get a first experience, probably when I was younger than a lot of others.”
This fire in the belly continued on into high school, where Brycki won the ASX’s national student trading competition three times.
Advice for Australians starting in shares
Fast forward to today, and Brycki runs Stockspot – an online adviser (also known as a robo-adviser) that makes it easier for ordinary Australians to own shares.
These days his investment philosophy is the opposite of what he did with fake money when he was a child.
“The [ASX competition] wasn’t really investing at all… it was a game about speculation,” he said.
“All the things you need to do to beat 50,000 [people] in a short-term trading competition is exactly the opposite to what you should do to invest in the long run.”
With real money in the real world, novice investors need to focus on the long term and avoid speculating, according to Brycki.
“It’s a bit like with Bitcoin at the end of 2017 when it hit $20,000. When a lot of newbies get involved in the market, that’s the most dangerous time because they don’t appreciate the amount of risk they’re taking.”
Bitcoin is now about $13,000, meaning many beginners who bought at the height of the cryptocurrency fever lost a lot of money – some saw their life savings disappear.
Brycki said while it is currently a great time to start investing in shares, first-timers needed to avoid speculating in a limited range of companies.
“That’s the best way to dust your money pretty quickly,” he said.
“It’s better to drip feed money into something that’s quite low-risk and diversify, where you are spreading your money across lots of companies.”