RECENTLY, I was organising a file with purchase contract notes for stocks bought a year ago. As I filed and looked at the prices on these stocks, almost to the day last December, I was stunned to realise that I have almost made a 100 per cent profit on most of them.

Now when I look at the prices almost a year later I wonder why other people took so long to start buying. Don’t they know that the way you make money is to buy low and sell high?

When stocks are trading at less than half of book value, what’s there not to love? When prices are attractive on stocks, you buy them. It’s a no-brainer. Can they go lower? Sure, they can. But it’s a market, and who knows?

When you go into a store you buy clothes on sale. Can the store discount them further? Sure they can. But you as the shopper recognise that you are getting value for money and you don’t at that point worry about further discounts. Doesn’t everyone love a sale? And isn’t it all about getting value for money, a concept most of us relate to very well?

So one year later, I am sitting at my desk counting my profits. In between I have been paid dividends which I have reinvested as the sale on the stock market persisted and stock prices were sooooo attractive. My returns have been compounding and I have been building my wealth.

What I know for sure, as Oprah always says, is the more you invest the better off you will be.

Speaking about Oprah, did you see that she bought shares in Weight Watchers? She knows the world suffers from an obesity problem, and that weight loss is a growth industry. She also knows that by buying today she will be in good “shape” for the future. Pardon the pun. Investing today is all about growing your wealth in the future. Before Oprah bought the stock she tried the programme and actually lost 15 lbs. When she saw how well the programme offered by Weight Watchers worked for her, she figured that it would work well for others. And so she made the investment, buying 10 per cent of the company.

Weight Watchers’ stock was trading at US$6 per share when Oprah Winfrey invested US$40 million. By the end of the day, in true “star power” style, once the market realised that Oprah had invested, the stock price soared. And in one day she made US$45M. Most people might sell and take their profit. But Oprah is in it for the long haul and sees a bright future for the company, and hopes to make even more on her investment in the future.

The interesting thing is that for many people, fear sets in, and they wait for prices on the stock market to increase before they buy.

Now that prices have improved, investors struggle to get the volumes on the stock market that they need. For every buyer there is a seller, and I have to say that the sellers have the advantage now. Now that prices are moving upward on the stock market, the number of would-be sellers is scarce. Just think about it, who in their right mind is going to sell their stocks now since stocks are still relatively cheap?

All of us should include investing in stocks in our portfolio because it has the potential to create wealth on an individual basis, and if each individual citizen is better off, then the country benefits as well.

Let us use the example of Oprah and buy the stocks of companies whose products we like.

Peta-Rose Hall is managing director of BPM Financial Ltd