Lessons of losing money in trading. Beware of the sure thing

The promise of quick riches is sometimes just too much to handle. And, definitely too much to walk away from.

Photo by Aleksi Räisä on Unsplash

Like many, I am always on the lookout for the next investment opportunity. The one that will make a quick buck, boost my wealth, and put me one step closer to financial freedom.

During my journey, I have attempted several investment opportunities. And when I say that I have attempted several. I have probably attempted way too much of these investments.

My journey started in 2015. I just started working at a professional services firm, not making a lot of money. But, with an education in finance, how difficult could a side hustle of trading really be?

I signed up for my first trading course and read a couple of books and I was ready to start my trading side hustle. It was a sure thing to provide me with 100% + returns. All the books and courses were claiming easy profits. just follow the secret and tested strategy.

The strategy is always the same. Follow the trends, don’t take profits too quickly, apply risk management, and wait for entry confirmation. Easy enough right.

No, even when following the strategy 100% to the tee, I wiped out. Given, the account I used was leveraged. In my defense. You do not really get unleveraged forex trading accounts.

Forward to 2016, a colleague of mine came to me with another easy and sure way of making money. Trading binary options. Binary options are trades that you are in for less than a minute. If the price closes above where you bought, you make a 60% to 90% profit. If not, then you lose 100% of what you put in. His claim, he made a profit of $8 000 after only three weeks (Starting with a capital of $100).

Well, to spare my own ego some blows. I am not going to tell you what happened with my binary trading experience. But I am sure you can guess as to the answer here.

Forward to 2017, Bitcoin was all the rave. Luckily for me, I received a tip at a barbeque one Saturday evening (towards December 2017). It was another sure thing where we will make billions by just investing $3 000. Well, you might think I would have learned my lesson by now. And I have. I already owned bitcoin by then. And I sold out the following Monday.

Fast forward and the Bitcoin price plunged from a high of almost $20 000, and have still not fully recovered.

Looking back at my investment journey. My “long-term”, value-based investments have performed remarkably well over the last six years. Or rather, I am very happy with the performance. Looking back at all the “sure things”, well they did not perform that well.

I applied some risk management, where I never had all my eggs in one basket. And this has saved us financially. However, some went all-in on a sure thing, and the results were not even close to ideal.




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Cloud Analytix

Cloud Analytix

Cloud Solution Provider. Passionate about cloud business efficiencies and security.

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