Brandon Fleisher is a 17-year-old high school senior who has been able to turn $48,000 into $147,000 trading in the stock market. It’s an incredible feat, but even more so when you take into account his age and the endless number of people who have tried and lost tons of money in stocks.
Apart from his successes, Fleisher also runs a website called The Financial Bulls. It’s a website and newsletter that lets inexperienced investors learn about markets for free.
Fleisher has been able to build so much clout that CEOs of established companies take Fleisher’s calls. Alan Sheinwald, Inuvo’s investor relations counsel, told CNN Money:
“He would call and ask fairly intelligent and insightful questions even though we thought he was 17 or 18 years old. He really acts as though he’s a professional investor.”
How Fleisher got started
The 17-year-old was first introduced to stock trading when he was in middle school. Fleisher told NextShark
“I was introduced to investing in my math class. The whole class did this stock picking game. We had to pick one stock, and we couldn’t buy or sell it again. It’s just one stock, and you wanted it to make the most profit out of the whole class by the end of the year.”
After that, Fleisher started learning everything he could about the industry. He cites a book by Peter Lynch called “One Up on Wall Street,” which he says set the foundation for his investing style.
“I would go through company reports and SEC reports to basically teach myself what I didn’t know. I would go through the reports and see ‘earnings per share’ — before I knew what that meant, I would Google “earnings per share” or ‘EPS’ and go back to the report. That’s how I would teach myself what I didn’t know by going through these reports.”
After seeing great returns playing with fake money in a virtual stock exchange game on Market Watch, he begged his parents to invest in him.
“I probably gave them about 20 presentations. When any of my stocks would go up I would screenshot it and send it to my dad and say, ‘If this was real money you would be up this much! Dad, you should be investing with real money because you’d make this amount.’ I even made some presentations and charts. For a while everyday I would be bugging him with that, bugging my parents, being like, ‘Give me money.’ [laughs]”
After much convincing, Fleisher’s parents, his mom a dentist and his dad who runs a metal scrap business, gave in and co-signed a portfolio with $48,000 of their savings to invest. Fleisher was 15-years-old at the time.
Investment pays off
After a mere two years, Fleisher was able to triple his parents’ money. Some of his most successful stocks include Tesla and Netflix, which more than tripled in value. He notes that his parents are proud of him, but he’ll have no access to the money for the time being because he’s still a minor.
“They definitely did not expect me to triple the money in three years — neither did I really. I’ve really turned investing into my passion, and it’s something that I’m going to do for the rest of my life. They’re probably going to let me keep this as my portfolio, and I’ll have to give them back the initial investment. Until I’m 18, I’m not legally allowed to have my own portfolio under my own name.”
Fleisher’s investment approach
Unlike conventional wisdom, which advises to put your money into well-known companies or mutual funds or ETFs (exchange traded fund), Fleisher likes to invest into small companies.
“I invest in small cap stocks rather than in really big companies like Apple, Google. The reason I do this is because with a small cap company, they still have a lot of time to grow. The industry could be growing and they have room to grow. You can also tell where they are going. But with Apple, sure the iPhone sales grew 10%, but iPod sales drop 2% and earphone sales drop 3% — there’s always something. A better example would be Kellogg’s, where cereals did better but breakfast bars get worse. Also with those huge companies, for them to grow, the whole industry has to grow; they’re just that big. Like Kellogg’s, they own half the cereals, so they need the whole industry to grow for them to grow.”
“I will usually invest in stocks at least six to eight months. If you ever follow a small company for a long time, you start to get a sense for it and start to see where it goes; you start to see patterns, like, ‘Right now it’s down but usually when it’s down people buy more.’ So I will play around with my stocks a little bit.”
With the amount of people out there that fail in the stock market, Fleisher lists some of the biggest reasons why people lose money.
“There’s a ton of reasons why people will lose money in the stock market. The biggest reason — and so many people do this — is a friend will tell them, ‘Oh you should check out this company; it’s going to double in value over the next year. It’s so good.’ Then the person that’s told that might look it up on Google and buy the stock without doing research.
“Another big reason is that people will do their research and think it’s a great company, but if the stock goes down 5-6%, they say, ‘Oh no’ and they’ll sell and lose their shares but then it goes up 50%. I think people should hold on unless something drastic changes. Stock prices will go up and down. They fluctuate. That should not make you get out of the stock.”
To get more information about a company, Fleisher will also call up the CEOs for questions.
“Obviously I can’t call the CEO of Apple, but with small companies I find them more accessible, and if they give you the opportunity to call them, then it’s a very good tool because — although they can’t tell you anything that’s not public — if you think they’re really good you can give them a kind of job interview and ask them, ‘Can you take the company in a new direction?’ — test them in a way. You could also ask them questions that you are not 100% sure about.”
Apart from his successes, Fleisher learned something valuable in his investing experience.
“Whenever I think of buying something, especially if it’s expensive, you have to take it out of your investing money, so instead of appreciating you’d depreciate, so investing has actually made me want to spend less. I know a lot of people think the opposite.”
For anyone interested in getting into investing, Fleisher says that the biggest thing before buying stocks is not doing research but learning how to do your research. He stresses that reading “One Up on Wall Street” by Peter Lynch is a great place to start. He advises that the best way to find out about companies is to simply go to the investors page on their website and look up SEC reports. Usually those places will have all the information you need about a specific company. When asked the best piece of stock trading advice he’s gotten, he said:
“One of the best pieces of advice I got is not to get scared of your stocks, and another is to do your research and look for things that other people don’t see because a lot of people will just look at the headlines, but you have to look beyond them and always look at the smaller words and find the things that are hidden.
Of course, I couldn’t have Fleisher leave the interview without revealing which stocks I should be investing my money into right now.
“Two stocks I am pretty feeling good about right now are both in the mobile advertising sector. Marchex and Inuvo, both small companies. And then there’s one more, it’s had a lot of controversy around it lately — Lumber Liquidators. It’s been down recently, but I think it can go back up soon. But it’s definitely been one of the more risky ones.”
Fleisher plans to go to college this coming semester, but investment is something he plans to do for the rest of his life.