Lessons learned on the stock market
As I mentioned in my post about my money game, I put $5000 into a brokerage account and bought stocks. So far I've learned some lessons, although I'm not sure how good they are.
If you buy a stock and you believe in it, be patient. You can't let a dropping price change your mind, and if it seems high, it doesn't mean it is. Do your research and stick by your picks, unless you have reason to change your mind. I bought one stock at a higher price than I should have, and felt bad that I did this as it dropped several percentage points. Right now it is up over 28% since I bought it on January 31st. I was not patient with another stock. I thought it was trading too high and I bought it too high, so I sold it thinking it would drop and I could get it cheaper. Since then, the lowest price has been my payment price, and right now it is up about $0.46 cents a share (or 8.3%) from the price I originally paid and sold it for. I should have just kept it. Oh well, it was my own mistake.
If you buy a stock and you believe in it, be patient. You can't let a dropping price change your mind, and if it seems high, it doesn't mean it is. Do your research and stick by your picks, unless you have reason to change your mind. I bought one stock at a higher price than I should have, and felt bad that I did this as it dropped several percentage points. Right now it is up over 28% since I bought it on January 31st. I was not patient with another stock. I thought it was trading too high and I bought it too high, so I sold it thinking it would drop and I could get it cheaper. Since then, the lowest price has been my payment price, and right now it is up about $0.46 cents a share (or 8.3%) from the price I originally paid and sold it for. I should have just kept it. Oh well, it was my own mistake.
Labels: money game, stocks
posted by MoneyFwd @ 4:15 PM
2 Comments:
At 3:20 AM,
Anonymous said…
That sounds familiar :)
I did this a few years ago while I was playing with some experimental money. Just a few hundred bucks in all. Impatience really got me. I bought and sold a few times over a matter of months, and lost a significant portion in just in trading fees. Didn't make a dime. Since then I have been trying to more patient.
Btw @ your previous post, you must be learning quite a lot from your father's experiences. Do share them with us once in a while. :)
At 3:31 PM,
MoneyFwd said…
I fell into the trap again, but at least I accept it as a trap.
We'll see about sharing my dad's experience, after all he always told me his best strategy was to buy high and sell low (and unfortunately that tends to be out family luck).
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