Health - Issue #29

« An investment in knowledge pays the best interest » once said Benjamin Franklin. The good news is that, if you’re a medical professional, it seems like you’re already a great investor! But let’s be honest, this observation won’t prevent the frustration of hearing your friend from Business School bragging about his 10% performance on stocks meanwhile your saving account is capping at 2%… 

However, should you let your precautionary nature, your humility in front of a sometimes obscure domain of knowledge that looks like a giant casino, or even your lack of time deprive you from your share of the pie? Spoiler: No, you shouldn’t 😉

The market is a fascinating mirror of the complex interactions between consumers, companies, geopolitical dynamics and innovations of tomorrow. The market is, above all, a time-travelling machine set up in “Future” mode. Its engineers, Traders, spend their time trying to put a price on the potential of companies - not today, but in 6 months, 1 year or even 10 years. This is why for instance Zoom shares surged by 200% since January, thanks to the infinite business opportunities in remote-working enabled by the pandemic.  

 

Investing in the stock market when you’re a doctor means putting your savings to work. But given our hectic schedules, it’s not possible to spend hours on it and trying to become an expert. This is where the distinction between “active investing” (regularly buying and selling stocks to “speculate”) and “passive investing” (buying stocks in which you believe and let it grow during months or years) comes in handy. The good news is that, in the long run, the second strategy is by far the most profitable and the less risky.   

But then, where should you start? To familiarize yourself with the Market, nothing beats a simple and fun simulation tool like Newspill - a daily newsletter that educates and informs you on the stock market in only 2 minutes per day.       

  

Once you’ve passed the psychological barrier, you can move to “real” trading by opening an account at a recognized broker. Then, you select the companies and sectors that YOU think have a high potential. ETFs can be a good choice as it gathers into a virtual basket stocks from the same industry or sector (e.g. Biotech, Aviation, Digital, etc.).

Eventually, do not hesitate to leverage your sectoral expertise to “feel” the market by anticipating structural changes, especially nowadays (e.g. future evolution of the pandemic, potential treatments, progress of some laboratories, etc.). 

If you think about it, there is a good reason why Hedge Funds hire researchers as Financial analysts 😎