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In My First Stock, we talk to Canadians about the first stock they owned and how the experience shaped how they invest today.

David Spencer, vice-president of investor relations at BloombergSen Investment Partners in Toronto

First stock: Toronto-Dominion Bank

I started my career in the investment industry in January, 2010, at age 23, working at TD Wealth, the investment division of TD Bank. My boss at the time talked a lot about the power of compounding and encouraged me to start stashing away a piece of every paycheque to invest. I bought my first shares of TD Bank TD-T in the spring of 2010 when the stock was trading at around $38 per share (adjusted for stock splits). Since I worked there and had a front-row seat to the quality and dominance of the business, I thought it was a logical place to start.

How it felt to make the purchase

I was excited and confident, and owning the stock also gave me an even greater sense of alignment and purpose with the company and the clients I worked for. I would be lying if I said there weren’t a few nerves when the stock fell by about 10 per cent a few weeks after I bought it, but I was aware of the risks. It was an early test of my ability to tolerate risk and a quick lesson of the need to think beyond short-term share price turbulence. I reminded myself that it was only a loss if I sold the shares.

What happened to the investment?

I liquidated my initial investment in late 2014 after the value of my initial investment, including reinvested dividends, nearly doubled because I needed the funds for a down payment on my first home. Since then, the stock has continued to be a massive wealth compounding machine for shareholders. It has consistently produced excellent returns and pays a healthy dividend. I wish I didn’t have to sell the stock at the time, but buying a home in Toronto in early 2015 has also been a good investment over the years.

Advice for someone buying their first stock today

Invest in great businesses that you fully understand – and do your homework. Too often, people invest in stocks because they’re part of a fad, or they got a tip from a friend, and they’re not doing their own due diligence on the companies they’re buying. Also, pay attention to valuation and price; those are key. When you overpay, even for a wonderful business, that can really become a huge hurdle to long-term success.

As told to Brenda Bouw. This interview has been edited and condensed.

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