I have come across many people searching for Holy Grail to make a killer from their investments in a very short time. I am not ashamed to reveal the fact that I was one among them a few years ago. The bitter truth is there is no Holy Grail.
I performed all types of mistakes which normal retail investors do in their initial period of enthusiasm. As beginners luck would have it, I made money on my first investment. Now I think it should be termed as a ‘bet’ instead of ‘investment’. I calculated percentage returns for the short-term bet and got excited. I immediately opened an excel sheet and dragged rows and columns to analyze how quickly I can become a CROREPATI. I could not sleep that night as I was dreaming with eyes wide open. All sorts of the imagination of financial freedom put me in pseudo-heaven.
Next morning, I transferred all the money I had to my trading account and started thinking which stock to buy for my next ride to glory. However, I burnt my fingers and I realized – without a good guide, I wouldn’t be able to ride. I had observed that my friend was making money from the market, and I decided that he would be my guru in my investment journey. I kept on taking his suggestions on stocks to invest, and eventually, my portfolio was in red. Later, I came to know that he borrowed ideas from his friend, who he considered to be an experienced investor.
Although I did not trade for a few days, I regained enthusiasm because the dream of becoming a CROREPATI was intact in my mind. I thought I should not give up on my dreams and I decided to continue my journey. I decided to listen to experts on TV and make some quick money. I used to come back from office and I used to be glued to TV for 6 hours a day noting down stock tips from all news channels. Urge to make quick bucks superseded saneness, and I ended up making huge transactions (buying and selling) based on recommendations of experts on TV. The end result was that my account was totally wiped out!
I have been an intelligent student during my school and college days. I believed that I could time the market with an intelligent strategy. This thought evoked ego and I transferred more amount to my trading account. I felt that Delivery based trading is too risky because of gap-up and gap-down during the opening. Hence, I decided to trade intraday. During office hours, to avoid conflict between work and trading, I trusted a broker and allowed him to trade for me. The broker explained the advantages of using margin money to achieve higher profits and he made me over trade. This resulted in a big hole in my pocket.
Although my enthusiasm was diminishing, the urge to become CROREPATI did not die. I decided to trade as per the advice of an adviser who had revealed his past performance on his website. It was whopping 300% returns per month! The excitement of such returns made my mind numb and I did not try to find out if his claims of such huge returns were real or fake. The truth was revealed in a few days when I lost more money, and I was sad for not learning from my mistakes. I did not give-up and I was hoping to find a genuine adviser who would help me recover all my losses. I decided to invest big by taking the cheap loan. I wanted to become a big market player and I tried Jackpot calls, sure-shot calls, operator-calls but I became a loan EMI payer struggling to pay the EMIs.
During the market boom, I heard about advancements in trading and investment industry. The hungry dog inside me started barking – “everyone is eating flesh, get me at least a bone”. The greed of making money superseded the pain of loss and this time, my entry was grand with sophisticated automated buy-sell signal software. Software seller gave a demo and it was mind-blowing. After I started using it, I noticed that my account was blowing away.
I thought ‘Every cloud has a silver lining’ and I decided to make money by educating myself about the market. I read many books, studied various systems, tested more than 2000 strategies but I applied none of that knowledge during trading. Nothing seemed to work and I blamed the market for my mistakes; after all, who likes blaming himself?
By God’s grace, I came to my senses and I firmly decided that I would not repeat the mistakes. I also decided to apply the knowledge I had gained and to stick to my plan. That was the turning point of my Trading and Investment career. Over the years, I have been a progressive learner gaining experience from the market as well as from my mistakes. This has helped me to enjoy swimming in the ocean of market without worrying about big tides that could lead to the market crash. In a nutshell, complicating your analysis, investment methods, systems, and strategies will do more harm than good to your health as well as wealth. My suggestion is to keep things simple so that even a stupid can apply it repeatedly and profitably. Hence the successful investment mantra is to KISS – “Keep It Simple and Sensible!”
Note: The character depicted in this article is fictitious. Any resemblance to persons living or dead is purely coincidental and unintended.