How Can I Screw This Up?

[rayray]

There's been a few, well, always new topics--winners and losers, high yielders etc etc etc

and that got me to thinking???? i know...dangerous...don't do it!! that's my first mistake lol

we're always focused on what to buy, what's my best idea yada yada yada...always thinking how can i win??

what happens if we take a step back, slow down and wonder???

how can i lose?

how can i mess this up?

what's my worst idea?

instead of looking how to be better....maybe it's just as beneficial and maybe easier to wonder the opposite?

and then don't do it


as i accumulate more and the net worth grows i'm starting to think this way--rather then how can i succeed and be better but rather what can i do to fail? then of course, not do it

[fenders53]

This should be a fun chat. This has completely become my focus when I knew I was about three years from full retirement. I am now 15 months away. Maybe I'll still want to work a little, but I want it to be optional ......... so I try to protect my lead but still participate in the market. I get scolded here often for being too negative and probably deserve it. Sometimes it saves me money, and sometimes my inaction costs me easy money. All in retrospect of course.

As careful as I thought I was, my port got steam rolled BAD last March. WAY more than it should have with my cash position and mostly defensive holdings. It was a wakeup call and I became even more self-critical. I panic sold a few stocks I thought were dead like DAL and DOW. They weren't. I also jumped on some super once in a decade deals. It all worked out. I am having one helluva 2021. Beating the SPY with lots of cash most of the time. That's a big win with one hand tied behind my back.

I do stock research like I never have before on my core holdings. I listen to a LOT of conference calls on boring stocks. I know what I am invested in. I sift through the idiots and scour youtube for intelligent people with an opinion on my core holdings. All with the intent of minimizing big mistakes.

I hand out lots of advice here. I try my best to never spew hype. If you buy a stock and I am pretty sure you don't have the facts I will probably speak up because I actually care if you lose money. I wish somebody had done that for me 25 years ago when I was setting myself up to get crushed, but nobody did and I got my face ripped off. I won't forget those lessons. So many mistakes back then. All obvious now.

I play options in a conservative manner almost daily and I'm sure many think I am either a guru or a gambler. I am neither. I am careful, am almost always on the sell side and after nearly 2000 trades. I know how to avoid trouble with significant amounts of capital. The income absolutely dwarfs my dividend income 11 months a year. That happens because I am careful to avoid big mistakes and know how to dance my way out when the ball doesn't bounce my way.

I guess I follow Buffets #1 rule best I can. Don't lose money. It really is true. You don't have to hit a lot of homeruns if you avoid hitting into too many double plays.

This is probably a crappy post. I could have done better. Told you I am self critical.

[mid range]

(08-03-2021, 02:22 PM)rayray Wrote: There's been a few, well, always new topics--winners and losers, high yielders etc etc etc

and that got me to thinking???? i know...dangerous...don't do it!! that's my first mistake lol

we're always focused on what to buy, what's my best idea yada yada yada...always thinking how can i win??

what happens if we take a step back, slow down and wonder???tied 

how can i lose?

how can i mess this up?

what's my worst idea?

instead of looking how to be better....maybe it's just as beneficial and maybe easier to wonder the opposite?

and then don't do it
as I accumulate more and the net worth grows i'm starting to think this way--rather then how can i succeed and be better but rather what can i do to fail? then of course, not do it

There is wisdom in this. Looking at my trading history, the winners are small and soon forgotten. Trades or "investments" where I have gone large and lost, waste money and precious time while I hang on.

[ken-do-nim]

My biggest monetary blunders are:

• getting divorced
  
• as an early investor, I thought you "buy low sell high" so I would find a bargain stock, set my sale price, and hold until it met that price. Bought Apple at $20/share when they came out with the ipod, sold at $30... it would be worth millions today
  
• cashed out some company stock options too soon, again lost out on millions had I waited longer
  
• got bored owning this "online bookstore" called Amazon, and this electric car company called Tesla, and this movie company that mailed you dvds called Netflix, and sold them and moved on to other things... yeah, millions here too.
  

[fenders53]

(08-03-2021, 03:52 PM)ken-do-nim Wrote: My biggest monetary blunders are:

• getting divorced
  
• as an early investor, I thought you "buy low sell high" so I would find a bargain stock, set my sale price, and hold until it met that price.  Bought Apple at $20/share when they came out with the ipod, sold at $30... it would be worth millions today
  
• cashed out some company stock options too soon, again lost out on millions had I waited longer
  
• got bored owning this "online bookstore" called Amazon, and this electric car company called Tesla, and this movie company that mailed you dvds called Netflix, and sold them and moved on to other things... yeah, millions here too.
  

Good post.

I never seriously considered AMZN before I bought shares at $1500.  I was around IPO day and it popped to $50 in a hurry as I recall.  No hope of a profit soon.  Bezos actually wore spurs, holster and six shooter to an early conference call and I didn't take him even a little serious.  I don't blame myself for that too much but by 2006 it was pretty clear they were dominant in retail.  I've never seen a company take so long to be profitable.  Revenue growth matters.

I definitely remember contemplating buying APPL at $7.50.  MSFT was winning then and it really looked like APPL was about to be irrelevant.

I would have taken my profit during GFC so it wouldn't have mattered anyway.

[rayray]

(08-03-2021, 04:05 PM)fenders53 Wrote:

(08-03-2021, 03:52 PM)ken-do-nim Wrote: My biggest monetary blunders are:

• getting divorced
  
• as an early investor, I thought you "buy low sell high" so I would find a bargain stock, set my sale price, and hold until it met that price.  Bought Apple at $20/share when they came out with the ipod, sold at $30... it would be worth millions today
  
• cashed out some company stock options too soon, again lost out on millions had I waited longer
  
• got bored owning this "online bookstore" called Amazon, and this electric car company called Tesla, and this movie company that mailed you dvds called Netflix, and sold them and moved on to other things... yeah, millions here too.
  

Good post.

I never seriously considered AMZN before I bought shares at $1500.  I was around IPO day and it popped to $50 in a hurry as I recall.  No hope of a profit soon.  Bezos actually wore spurs, holster and six shooter to an early conference call and I didn't take him even a little serious.  I don't blame myself for that too much but by 2006 it was pretty clear they were dominant in retail.  I've never seen a company take so long to be profitable.  Revenue growth matters.

I definitely remember contemplating buying APPL at $7.50.  MSFT was winning then and it really looked like APPL was about to be irrelevant.

I would have taken my profit during GFC so it wouldn't have mattered anyway.

oy vey to both posts

i have some oy veys too...

that's why i'm very hesitant to sell certain stocks--almost better to let them go to zero

[fenders53]

Ray

It is smart to be slow with the sell trigger. It's an interesting game of what if. I've rode some blue chip stocks to zero. Held CSCO and INTC for ten years. Sold and ten more years later I would still be way down. What if I had bought any of the FANG stocks with that money? I bought JNJ and XEL instead. One in 1000 troubled stocks become life changing. Fortunately you can do OK without any 100 baggers. You just need to get it mostly right.

[rayray]

(08-03-2021, 05:34 PM)fenders53 Wrote: Ray

It is smart to be slow with the sell trigger.  It's an interesting game of what if.  I've rode some blue chip stocks to zero.  Held CSCO and INTC for ten years. Sold and ten more years later I would still be way down.  What if I had bought any of the FANG stocks with that money?  I bought JNJ and XEL instead.  One in 1000 troubled stocks become  life changing.  Fortunately you can do OK without any 100 baggers.  You just need to get it mostly right.

absolutely 100%

singles and doubles is all that's needed for a successful portfolio

fidelity also did a study and found that inactive accounts outperformed active portfolio's

https://www.businessinsider.com/forgetfu...est-2014-9

[fenders53]

I saw that some years back. Emotional trading causes that. Buy what's hot this month and cash out after losing some money. It's a lack of conviction and discipline. If you buy some yahoo finance stock tips and look at charts for 5 minutes you don't even know what you own. You do some real DD or you won't get half the index return. I held index funds most of my investment career because I learned I only had time to research a few companies. Now I have time to stay current on more tickers but I still over do it. Buying true blue chips is more forgiving. They might work out if you just give them time.

[mid range]

I thought of different ways to divert my attention over the years. Some study and a decent amount of time devoted to all. 1) Precious metals. 2) Trading preferred stocks. 3) Volatility ETFs. 4) Shorting distressed equities right before the advent of Reddit's Wall Street Bets. They turned out to be the kinda Good, kinda Bad and the very Ugly. Now on to dividend growth stocks with options. Guess it needs to be both the right thing and the right time and don't get greedy.

[rayray]

(08-03-2021, 08:27 PM)mid range Wrote: I thought of different ways to divert my attention over the years. Some study and a decent amount of time devoted to all. 1) Precious metals. 2) Trading preferred stocks. 3) Volatility ETFs. 4) Shorting distressed equities right before the advent of Reddit's Wall Street Bets. They turned out to be the kinda Good, kinda Bad and the very Ugly. Now on to dividend growth stocks with options. Guess it needs to be both the right thing and the right time and don't get greedy.

know yourself as an investor, risk tolerance, research, read-read-and read more etc etc etc

pick a plan, a valid plan

take all emotion out of investing and go by the data, follow the data as long as the data is accurate and not a lie you're in good shape

[rayray]

(08-03-2021, 06:42 PM)fenders53 Wrote: I saw that some years back. Emotional trading causes that.  Buy what's hot this month and cash out after losing some money.  It's a lack of conviction and discipline.  If you buy some yahoo finance stock tips and look at charts for 5 minutes you don't even know what you own.  You do some  real DD or you won't get half the index return.  I held index funds most of my investment career because I learned I only had time to research a few companies. Now I have time to stay current on more tickers but I still over do it.  Buying true blue chips is more forgiving.  They might work out if you just give them time.

emotion is the biggest principle killer, worse then recessions themselves