So how did Phil do it?

[AlexG]

Originally Posted by dirkuys

Hi all! I was wondering as well how Phil turned $1000 into $1-mil in 5 years, but like the others I don't worry too much on the how HE did it, I decided to focus on how I SHOULD try doing that.

One question I have here: Let's say Mr Novice starts with $1000 and he buys one great company. He gets in and out of that company as the tools tell him to do. Should he maybe add cash to his portfolio and use that to buy more stocks of the same company? Or does the $1,000 simply just grow by itself?

hey D, there is no real way to go about it. It's all about what can you invest and only you know. Each one of us in the community have our own financial situation and plan to invest our money in different ways.Personally, I save in invest once a month. Sometimes I add to existing positions. And other times I might start a new position with a company I find attractive.Again this is my personal situation.

-Alex
WS Lounge

[travelinman]

Originally Posted by ApexAZ

Starting with $1,000 of borrowed money and a yearly salary of only $4,000 (who knows what that would be worth today? Maybe 10k a year?) how exactly did Phil manage to become a multi-millionare?

I believe that Rule #1 is a good way to grow your money, but I don't believe he got rich just from Rule #1, so how did he do it?

Perhaps he made a few investments that exploded and got lucky? He mentioned he had a lot of real estate at one point, perhaps this added to his residual income?

I think Rule #1 is an outstanding method of trading on the stock market, however, I don't see how people can become millionares as Phil did by only following that method. There has to be other, faster ways to accumulate wealth. Yes, we can grow our money to a million and more, but to have 10 million plus seems unlikely with just rule #1 investing. Lets also not forget that Phil also claims he made his first million in his first 5 years let alone an entire lifetime of compounded interest.

Thoughts?

I think Phil talks about it on his blog. I believe he said there was luck involved more from the timing (when he got started) of his using Rule # 1 than from the actual trading of his rules. Warren Buffett said that there are about 14-times in your life that you will have a great opportunity to make lots of money, I think Phil just started off at the right time with his investing using a great system.

I would also go on to venture that this period right now is not one of those 14-times in your life that you will have tremendous opportunity to make a lot of money easily following Rule # 1. How many Rule # 1 companies can you find right now close to their M.O.S.? Myself, I will wait and not chase Rule # 1 companies that are far away from a good entry point. Patience, most important part of investing.
Steve

[GRock]

Interesting read. Phil obviously had a bit of luck combined with the go go 90's stock market but I believe its where went from there to cause him to write his book. Plus he is probably board on spending a few minutes a day working (on his investments). After doing the Cramer thing and having some success (even way before Cramer) stumbled on Phil's book after a CNBC show and read it. It all came into focus. I could pick some good stocks but did not know how to value them. And the biggy was not knowing when to bale or get back in. I back tested all my positions with the tools and the epiphany ensued. I had some number oners by chance and some that were not even close. Though had made some decent gains I cashed those out. Instead of playing around with a small portfolio I have moved out of the mutuals and directly into stocks.

Justin great site glad I found it. Just hope we can get more activity but it will take more investors I guess.

GRock

[Drake30]

Here is how:

Maverick at Play - Success Magazine

Some excerpts from the article:

But even that, Town admits, “will not get you from $1,000 to $1 million in just five years. That requires something else: a lot of luck and great timing. And that’s exactly what happened to me. When I started investing in 1980, the stock market was actually 40% lower than it was in 1965. I started investing at a time when it was perfect. It would be like investing today with the market at 11,000 and, in five years, it runs to 60,000. It was that perfect.”

The first company Town bought into using those principles was Westbridge Research Group, who manufacture environmentally safe agricultural chemicals “With the help of my mentor, I came in as a private investor, as well as a public investor. So I got in at a highly leveraged point and made a lot of money.”

Originally Posted by ApexAZ

Starting with $1,000 of borrowed money and a yearly salary of only $4,000 (who knows what that would be worth today? Maybe 10k a year?) how exactly did Phil manage to become a multi-millionare?

I believe that Rule #1 is a good way to grow your money, but I don't believe he got rich just from Rule #1, so how did he do it?

Perhaps he made a few investments that exploded and got lucky? He mentioned he had a lot of real estate at one point, perhaps this added to his residual income?

I think Rule #1 is an outstanding method of trading on the stock market, however, I don't see how people can become millionares as Phil did by only following that method. There has to be other, faster ways to accumulate wealth. Yes, we can grow our money to a million and more, but to have 10 million plus seems unlikely with just rule #1 investing. Lets also not forget that Phil also claims he made his first million in his first 5 years let alone an entire lifetime of compounded interest.

Thoughts?

[npg]

Attending conferences where you charge 2.5k or some silly amount per head to attend, as well as selling a book about ditto the same thing helps you get there as well :P

I should be easy on Phil though, he has done a nice job getting people started.

[goelzgroup]

During the 90's the s&p grew 20% on average that is 500 companies, Phil had to just pick a couple undervalued, especially internet and tech stocks and ultimately see 80% and more in returns. Cisco rose 1100% at one point compounded over 5 years, its doesn't take much.

TODAY is different, be patient those days may return, be happy with 15% return its ahead of the bond and the S&P. Buffett is still doing, without a computer and in a volitile market.

Do your homework the time is near, A Democrat president historically destroys the U.S. economy, bad for the economy and some of the people in it, but good to find undervalued stock, you will probably see double digit interest rates in the next three years, bargains galore follow.

[dspahr]

Has anyone considered the fact that if he really did get that rich off the trading he would have likely been retired on a beach somewhere rather than self promoting himself endlessly and selling seminars and books?
Maybe he got rich off the books and seminars rather than getting rich day trading... just a thought...
I DO think about how he made his money and starting with $1000 it would take him 50 years to make 1 million with a 15% ROI. Even returning 50%/yr it would take over 17 years to make just 1 million! I am sure i am missing something, but the numbers just do not add up.

[SeanieT]

Have some faith boys. Hey at least its better than what a Funds manager would do? Plus, I don't think Mr. Buffet got where he is without some faith in his philosophy.

[poisontee]

Originally Posted by SeanieT

Have some faith boys. Hey at least its better than what a Funds manager would do? Plus, I don't think Mr. Buffet got where he is without some faith in his philosophy.

I wouldn't worry about how Phil made his million in 5 years. One thing I would worry about is not loosing my money. If I can get the 15% Minimum return as a Rule # 1 investor, I will be a head of the game coz my fund manager will never get me such a return. I believe as We do more rule # 1 investing, we will find out that 50% returns are possible if we don't violate the rules.

Again, lets focus on not loosing money and not if phil really did it or not. If you make your money rejoice rejoice.

tim

[npg]

Originally Posted by poisontee

Again, lets focus on not loosing money and not if phil really did it or not. If you make your money rejoice rejoice.

...and lets certainly not look at the obvious truths staring right into our eyes. Oh no! That would be too painful to bear...!

Come on. Wake up. Bullshitting yourself is the best way to get rid of yer purse's contents.