Let’s Get This Party Started

Hey! Happy New Year! And welcome to Library Life Hack. This blog is a year-long experiment into determining the actual dollars-and-cents value of a library card.

Over the next 52 weeks, I’ll be talking about new skills that I’ve picked up through the use of library resources. What will I be learning? Skills that are useful to me, and skills that I hope might be useful to some of you. Ideally, in the true spirit of a life hack, these should be skills that save us time, money, or both. Expect posts on roasting your own coffee beans, learning how to speak another language, packing a decent lunch, building a sofa bed from scratch and knitting a sweater in a weekend.

How will it work? Each time I post, I’ll add up the consumer purchase price of the materials I’m using, plus any other money saved along the way. This will go onto the Math page. At the end of 2013, you and I will get to see what my library card is worth.

When you think about it, public libraries are one of the great original life hacks. Abraham Lincoln is said to have educated himself almost solely with borrowed books. Philanthropist Andrew Carnegie believed so strongly in public libraries that he funded and built 2500 of them, over the course of 46 years. If they time-travelled forward, I have no doubt that the wealth of knowledge housed in a modern library would astonish and delight these two great men. But enough background. Let the hacking begin!

Week One
It took a while to decide where I should start, but I eventually settled on opening with a topic that would potentially generate some money, even if it’s only in the theoretical sense right now. This week, we’re going to talk about learning how to play the stock market.

My crash course in stock market investment came by way of a book by Jason Kelly called “The Neatest Little Guide to Stock Market Investing”. It was first published in 1998, and he releases an updated version about every three years. (The very newest one came out about a week ago.)

This book lives up to its name. It’s a quick 320 pages and it explains, in simple and tidy language, exactly how the stock market works and exactly how to invest in it. It’s comprehensive but there’s no fluff — just easy-to-understand, common sense instructions. By the end, I was pretty confident that I could use the book to build a real-life stock portfolio.

For the purposes of this blog, however, we’re going to build an imaginary portfolio and track its progress for the next year.

Here’s how it works: First, I followed Jason Kelly’s advice to locate a group of stocks that I thought had good potential. Next, I used his worksheet to whittle down to 15 winners. This worksheet compares stocks across 30 criteria. I know that sounds like a lot of work, but these are standard numbers and ratios and they aren’t that hard to locate.

For US stocks, the bulk of the information that goes into the worksheet can be found in three publications: Value Line Investment Survey, Standard & Poor’s Outlook and Investor’s Business Daily. And this is where library access REALLY pays off.

These are three outstanding investment periodicals. And a year’s subscription to them will set you back just over $1000. Unless, of course, you have access to a library. You’ll find them in the business reference section of most larger libraries, where you can research them for free. Cha-ching!

With Canadian stocks, you can find most of the worksheet information by digging a little between Google Finance, Yahoo Finance and the annual reports of the companies you’re looking at. (What you’ll have to live without are the ratings that are specific to Value Line and Standard & Poor’s.)

Meet the Library Life Hack Dream Team
This imaginary portfolio contains one share of each of the 15 winning stocks. We’ll be checking in on them once a month.

Company Name Ticker Symbol Closing Price Dec 31
AEtna Zentaris Inc. AEZS 2.38 CDN
Bombardier Inc. BBD-B.TO 3.76 CDN
Callaway Golf Co. ELY 6.50 US
Cameron International Corp. CAM 56.46 US
Canadian Tire Corp. CTC.TO 81.00 CDN
Cott Corp. COT 8.03 US
Indigo Books & Music IDG 10.68 CDN
Koninlijke Philips Electronics PHG 26.54 US
Magna International Inc. MG.TO 49.68 CDN
Research in Motion Ltd. RIM.TO 11.80 CDN
Ryder Systems Inc. R 49.93 US
Sherwin-Williams Co. SHW 153.82 US
Sparton Corp. SPA 13.87 US
USG Corp. USG 28.07 US
Westjet Airlines Ltd. WJA.TO 19.81 CDN
Total Value $CDN $179.11
Total Value $US $343.22

And ta dah! That’s our first library life hack. If you want to try it for yourself, here’s the complete information on this week’s library materials:

The Neatest Little Guide to Stock Market Investing
Written by Jason Kelly
Published by Plume
Released Dec 25, 2012
ISBN 0452298628

Value Line Investment Survey
Found at valueline.com

Standard & Poor’s Outlook
Found at spoutlook.com

Investor’s Business Daily
Found at investors.com

And now, the numbers. The current cost of the book on amazon.ca is $12.27 and on chapters.indigo.ca, it’s $12.92. That averages out to $12.60. Value Line Investment Survey is $598 US for an annual online subscription. A year of Standard & Poor’s Outlook online is $200 US, and a year of Investor’s Business Daily is $269 US. Once you do the conversion to Canadian dollars, that’s a whopping $1067.86 saved by using a library.

I’m pretty jazzed about this year-long experiment. But you know what? I’m even more jazzed that you took the time to read this post. If you like, leave a comment and if you have a life hack you want to see me try out, drop me a line at LibraryLifeHack [at] gmail.com.

Next week, we’re going to tackle some simple ways to home-roast your own coffee beans — which leads to a great cup of coffee at a better price. In the meantime, have a great week, and Happy 2013 to you!

signature

3 thoughts on “Let’s Get This Party Started

  1. One of my rules of investing is never own an airline stock. I learned that by owning WestJet for years and watching it languish.

    Like

    • Hi,

      Well, that is a good point.

      One of the things I learned from the book that I talked about in the post is that airlines often have negative profit margins, as well as guidelines for declaring bankruptcy built right into their business plans. Yeah … doesn’t exactly inspire confidence, does it?

      WestJet share prices look to have peaked in early 2007 and then completely tanked by late 2008, without really going anywhere again until early 2012. But it’s pretty strong right now, and it made the cut by virtue of its price-to-sales ratio (you’ll have to read the book to find out why that’s important.)

      Thanks for the comment!

      Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s