A scary Chat prospect...for me
I’m going to use Substack Chat to discuss a guide I’m currently writing. Read below and comment on Chat, and I'll give you a free copy of the finished product.
What’s this about?
I’m writing an investing calculator for busy middle-class Americans living abroad. My expat credentials are limited to Canada, so my Calculator may be confusing or irrelevant for expats living elsewhere. After all, I don’t know what I don’t know.
If only I could get other expats to have a look …. and suddenly Substack’s new Chat feature appears. 💡💡! I could use Chat to get subscriber feedback on the draft. Then make it better.
How Chat works
Chat is a private conversation space in the Substack app that enables a shared commentary by subscribers of a newsletter. You would be able to comment on my draft Calculator and your comments would be seen by me and other subscribers to my newsletter.
Who knows? Some interesting discussions might emerge. I’m sure I’ll learn from you.
In this and the next few posts I’ll present sections of my Calculator instructions and invite your comments and questions. I’ll quickly respond to all comments and, where appropriate, modify the Calculator.
When it’s finished, I’ll send all commentators a 100%-off purchase discount code.
To join chat, you’ll need to download the Substack app, now available for both iOS and Android.
Chats happen on the app, not by email, so go to https://substack.com/app on your phone and install the app.
Open the app and tap the Chat icon. It looks like two bubbles in the bottom bar, and you’ll see a row for my chat inside.
Then turn on push notifications so you don’t miss conversation as it happens.
Now, on to the first part of my Calculator.
The Calculator’s backstory
Middle-class Americans living abroad are hamstrung by US tax laws if they try to save for their futures.
Low-cost investment products like ETFs traded on non-US markets require the filing of complex IRS tax forms annually. The tax prep costs for a middle-class expat diminish or completely outweigh the benefits of these popular products.
Why not invest in the US market then? If you don’t have a US address, US brokerage companies won’t allow you to open a new account or continue with an existing one.
Think that you could just trade online with your US broker? Possible but risky. Many brokerage companies will close your account if they detect that you are accessing your account from a foreign location.
What’s an expat to do if they want to invest? There’s an old fashioned solution: invest in individual company stocks. Technology has made that easy and inexpensive to do.
However, it can be risky to bet one’s investments on the shares of one or two companies. Most investment advisors recommend investing in multiple companies. It’s called diversification.
It’s a good idea. Instead of placing all your investment money in a couple of companies, you spread your investment money across many companies (10-20). That way no single company has too much influence over the total value of your holdings.
A diversification strategy generally works well, but it can be time consuming to trade and monitor multiple companies without some help. The Calculator offers that help.
Following is Part 1 of the Calculator.
Dynamic Stock Trading Calculator
Time-saving worldwide tool for allocating investment funds to multiple stocks in a diversified portfolio
Why this tool?
The Dynamic Stock Purchase Calculator is for someone who wants to invest in multiple companies traded on a public stock market.
Investing in multiple companies is called diversification. It’s a good idea, and most investment advisors recommend it.
Instead of placing all your investment money in one or two companies, you spread your investment money across many companies. That way no single company has too much influence over the total value of your holdings.
A diversification strategy generally works well, but it can be time consuming to trade and monitor multiple companies without some help.
The Dynamic Stock Purchase Calculator provides that help. Here’s how:
Handles stocks listed on markets worldwide;
Only your available funds, the transaction fee, and your stock list is entered;
Updates stock prices in real time with a slight lag;
Produces a buy/sell list with latest prices for brokerage orders;
Apportions investment funds equally across multiple stocks; and
You learn how many shares of each company to buy.
Getting started
Welcome and thanks for your purchase.
Apart from this guide you only need a Google account to use the Calculator. If you now use Gmail or another Google app you are already a Google account owner.
If you don’t have a Google account, go here to open one for free.
Once your have a Google account, click on this link where you’ll see the following screen:
Click the blue Make a copy button and give your copy a distinctive name. Below is a screenshot of my imaginatively titled Sheets listing.
To open your Dynamic Stock Purchase Calculator, click on the Sheets icon beside your Calculator name.
How the Calculator works
The Calculator runs on Sheets, and is shown below.
A key feature of the Calculator is that you only enter content in the yellow cells.
The leftmost column on the Sheet is titled Stock Symbol. Each row under the heading is where you enter a stock abbreviation, which has 2 parts that are separated by a colon.
The left part is the code for the stock market (e.g., TSE for the Toronto Stock Exchange), and the right part is the code for the company (e.g. RY for Royal Bank). The TSE:RY tells Sheets to fetch information about the Royal Bank of Canada stock trading on the Toronto Stock Exchange.
To find the stock market code for your location, consult this listing of exchange codes from around the world.
The Calculator then uses a market lookup function to fill the Company Name and Latest Price columns (orange text) with current or slightly delayed real-time market data.
Note that if the market is open, a stock’s price may change without any action by you.
All other cell entries are filled with the Calculator’s programmed calculations.
Figure 1. Example of Calculator Results
The Shares to buy/sell column displays the number of full shares to buy for each company without exceeding the Target $ amount.
The Est. cost column shows the sum that would be spent for the listed number of shares with the Transaction cost added.
The $ Committed and % Committed amounts show the absolute and relative portions of the Target investment that are accounted for by the proposed purchases.
The upper left of the screen displays the current date (month-day-year format), which is valuable for later reference.
The example shown below has 2 sheets, one labeled Don’t Delete and the other, Portfolio 1. The Don’t Delete sheet is displayed and shows a completed purchase plan for buying 10 stocks. Later you’ll see an example of the Portfolio 1 sheet, which is where you’ll create your own plan.
Your turn
That concludes Part 1 of the Calculator. What do you think so far? I would really appreciate your Chat remarks, from the most obvious to the most complex. I’ll check for comments here and in the Chat.