This is the first time I’m sharing this story, of how I lost 100k by trading stocks. Not day trading that’s different.
How i lost $100k trading Stocks and what I learned
How I lost all this money
Short answer: I broke my two rules when it came to investing
Rule 1: invest based on facts, not emotion ( including people going crazy at a stock because everyone is going crazy at a stock)
Rule 2: Have an exit strategy (the hardest thing to follow)
(the main idea was) 15% profit or 15% loss and you’re out
Tip: Believe it or not, its easier to get out when your winning, than when your losing. ( FOMO is stronger in that negative way)
The long answer:
The start:
Beg: College and the Fake portfolio, we all had to do it. ( but the only problem was that money was fake and not real) So I wanted to up the ante, so I wanted to put my real money in the market.
Climax: So like any normal 18 years old, I took download every audiobook, article, and video that I could about investing.
Example: The intelligent investors
Intrinsic formulas
MIT had a free math course on youtube at the time ( I did everything )
Ending:
After getting all the info, I decided it was time. And I made an Etrade account and translated my formulas into excel.
What I bought:
Beg: You probably think, I lost money on all my investments, the answer is no. I actually made money on 75% of my selection ( but now enough to offset the lost)
Climax: At this time I had 5 to 10k and I bought 5 different stocks.
I bought:
30 shares of Walmart at $58.56 and sold at $71.80 = Profit $397.2
( If I held till today at 115, I would have made $1,719 bucks )
67 shares of Etsy at $9.09 and sold it at $14.30 = $349 Profit
( held today at $47.96, I would make $2,604 profit)
32 shares CXW at 29.92 and sold it at $33.68 and made: $120 bucks
( If held I would have lost half of my profit, I sold because the pollical climate was changing and I was right )
Bought 50 shares ZFGN at 11.27 and sold at 15 for a = $169 profit
If I held: I would lose almost all the money ( worth less than $2 today)
Total profits: $1,035
Climax: but then I bought Go pro: my formula gave it a valuation of 10-15 dollars max, but I said I don’t care.
So I bought 50 shares of Gopro at $30.30 = $1,515
Its worth $-1,312 an 86% lost.
Why not sell it: I will for the tax benefit, but for now it’s a reminder.
Ending: but I do have good news.
What I learned:
1. Short answer: Follow your rules because 1 bad egg can ruin the entire basket
If I sold go pro at 15% lost, I would have still been positive by $800 bucks
How I Changed:
Beg: today that original 7k that I had back then is now worth 90k, because I started a business with that money, and flipped for a little over 5 years. ( that’s a 12x profit )
Climax: if I had cut my loose on go pro I would have had 1300 bucks at 12x growth would be $15,600, which would make the business worth over 100k
Ending: and that’s how I lost 100k or $200 bucks net
Final Tip: follow the riles not the hype
Silver lining: my long investing account is worth $9,250 bucks with a 10.13% gain and 100% diversified. I use acorn link down below and I’ll keep you guys updated
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