Embarrassing Investment Experience

Well, this is embarrassing. I’ve tried numerous investments over the years. I traded commodities for a while. I picked the months pre-crash to do some stock day-trading. Actually made some good buys, but decided the market was fixed, got most of my money back, and got out. Land. Apartments. Do not own apartments unless you have fortitude and common business sense. Just don’t.

As it turns out, here is perhaps the best investment I made during all that time.

In 1989, I decided I wanted to join Sam’s Clubs. I got their application, and saw that only certain criteria qualified a person for membership: government job (of course), self-employment (I worked for a law firm at the time), and a few other things none of which I was. So, like any good lawyer might do, I found a loophole.

Wal-Mart shareholders qualified for Sam’s. So, I trotted down to the stock brokerage on the first floor, and asked to buy a single share of Wal-Mart stock. Nice guy came out, met with me, was pretty amused at my request, but accommodated me, probably thinking a lawyer might show up with more investment money some day. So, for $28, the price of 1 share at the time, fee waived, I bought one share of Wal-Mart stock.

My single share, with dividends all reinvested, is now worth about $870. I can get the septic tank uncovered, repaired and cleaned for that. Though a liberal arts major, I have given myself a basic business education over the years — sometimes the hard way — and I ran the ROI on a $28 dollar investment in 1989: almost 13%.

Thirteen percent is not a bad return. Not legendary, or magical, but solid. Harder to come by than people fantasize. Had I invested a mere $1,000 instead of $28, I would now have — well, you business majors figure it out. That’s where my psychology degree and limited self-education in business stops. But, I think it would have yielded just over $100,000. A risky lack of diversification, granted, but a nice return on WMT based on the fundamentals of that’s where I and just about everybody else bought stuff.

So, the best investment I made over the years was that whimsical purchase for no reason, other than to sneak into Sam’s.

This is why they have financial advisors.