In 2021, I began the journey of becoming more financially literate. Approaching 30 as an artist and entrepreneur, I was tired of not knowing. A little FOMO mixed with just generally wanting to push my limits. To step my family generation forward. I knew I could do it. So I did.
For the first time in my life, rather than immediately spending or reinvesting my “expendable” income, I chose to dive into the recent? hype of the stock market and crypto.
I have dabbled in it over the years as a financially irresponsible millennial, but it was always pretty much too late or I couldn’t HODL. To be honest, I didn’t understand it all. I threw 400 bucks into bitcoin in 2017 but immediately took it out once I made $300 in 3 hours. I didn’t understand the concept of holding, wave theory, options, stock psychology, or pretty much anything other than riding the pop hype waves.
Over the past year or so, as I’ve seen the stories of people making so many gains and paid attention to YouTube’s vast array of finance gurus, I knew this was the time to learn what this bad boy is really about. So I took $5,000 and began to have a little fun.
I learned a lot along the way.
I tend to go through periods of extreme learning about different things. My job as a creator and entrepreneur really allows me the flexibility to take large amounts of time to STUDY. I love having the freedom to use that time to study things I’m currently interested in, and that’s what I did with stocks/crypto.
Every day for 3 weeks I watched/listened to 2ish hours of YouTube professionals studying and analyzing the unanalyzable. I lost money. I gained money. I learned some do’s and some don’ts. It’s been a bit of an exhausting journey, but I’m so glad I’m finally in the game.
And before I get into this, please know I’m still learning and am very much an amateur. I hope you find these do’s and don’ts as helpful as they’ve been to me.
Here’s what I learned:
1. Don’t Invest In Something Just Because It’s Going Down
Unfortunately, I learned this the hard way. In the first few days of diving into this world, I saw that a stock had dropped 20% in one day. I had heard about “buying the dip” so naturally, I was like:
“THIS IS THE DIP I’M SUPPOSED TO BUY!!”
So I put $100 of my own money AND $300 of Robinhood Margin, directly into the stock. This was a very bad call.
The next day it dropped an additional 60%, and I immediately got MARGIN CALLED. Imagine my frustration thinking I was about to HODL and watch the dip go back up when in reality I had just bought into a pharmaceutical company that the FDA was about to vote on whether it would be approved…
Amazing what a little research will teach you, right?
This is when I realized that you can’t just buy ANY dip. You have to know the company you are investing in and if they are dipping, is it just the natural waves of the market, or is there a real issue. (Should be common sense I know — but it was not.)
2. Don’t Invest What You Need Right Now (Willing To Lose)
There is a reason EVERYONE tells you this. I just didn’t understand it fully until I actually watched both the crypto AND stock market fluctuate. I’ve seen my portfolio drop hundreds of dollars, but just in the span of 1–2 months, I’ve seen it go UP and then go DOWN and then go back UP higher.
I’ve also witnessed one of the biggest crypto crashes that we’ve seen in recent history. I bought the dip this time, and guess what? It’s back and rising!!
If I would have invested the money I needed RIGHT NOW, I would have lost hundreds and hundreds of dollars with NO opportunity to make profits. The market almost always corrects itself and comes back eventually. So am I still holding the pharmaceutical company that dropped 80%? No, BUT I did wait until it went back up 60%, Then, I sold to reinvest elsewhere.
Along with this, of course, you shouldn’t put in what you aren’t willing to lose for the time being. With crypto particularly, it’s super volatile, and we don’t really know what will happen. With the stock market, ideally, you don’t want to really lose anything ever. I am not willing to lose any of my money, yet I’m in the market. The irony.
I think it just makes you a better investor when you aren’t dependent on the funds invested. I found that when I was an emotional investor, things went downhill fast.
3. Don’t Sell When It’s Down — Just Don’t
This is my philosophy. I’m okay with taking a little loss if I find a better investment, but I’m not FEAR selling. Don’t just throw money in because you hear randomly something is going to explode.
Then, see a 5% drop, immediately sell and lose all your chances of gains. When you look into the psychology of the market, this happens so often and explains why the market itself is so volatile (outside of huge whales influencing everything).
One way to avoid this is to not buy when it’s at a peak wave. A good strategy is to look at the 52 week high and buy when it’s down. Unless you have some knowledge of a huge growth spike, buying at a price around the 52 week high won’t give you many gains in the short term. From what I’ve seen. Although, there have been a couple of stocks that have surprised me.
4. Don’t Be Afraid to Move Things Around
One thing I’m enjoying, for the time being, is watching the waves, 52 week highs/lows, youtube analysts, and moving money around as I lock in profits. The market is truly a huge game to me. Kind of like business in general. Video games for the big babies of the world.
As long as you are following the above “don’ts”, it’s totally okay to move things around. Even the best stocks won’t go UP forever. So when the stock reaches a price where you can lock in some profits, don’t be afraid to take those gains and buy another dip (or put in your bank account).
It seems like most people recommend holding for the long term, but I have seen a few established investors on YouTube moving things around pretty consistently. I’ve done this and done well, but I’ve also done this and done not well.
5. Do Listen To a Variety of People
This may seem obvious, but it’s important to listen to a variety of different mentors or gurus. Even if you find one you really like. Once I find someone and trust their authenticity and knowledge, I still lean on other opinions before I solidify my own.
Here are a few of the people/channels that have really helped me:
Invest w/ Alen
Alen is super genuine and knowledgeable when it comes to stocks and crypto. He started 2021 with a 10,000 portfolio and grew it to over $100,000 with his Patreon members. Letting them know every time he buys or sells.
Seems very reasonable and knowledgeable when it comes to crypto. Love how he talks about the importance of strategy.
Millennial Money — Andre, Jeremy, Kevin & Graham
All of these dudes are super financially SMART, wealthy, and entertaining. I love listening to them all talk together, but then also, hearing their thoughts separately is entertaining. I highly recommend checking out their channels together and separately.
A day trader with great quality videos and explanations.
These dudes have a lot of clickbait and some cringy videos, but I’ve also learned a lot about crypto from them.
Cheat Code Algo
Cheat Code Algo is not only an extremely powerful algo, but it’s also a fantastic community for learning.
6. Do Diversify Your Portfolio
I am no pro when it comes to how much you should diversify your portfolio, but you should, just in case your top stocks tank and go bankrupt. Like the whole market the past few months. Based on my experience, it makes the most sense to have a balance of stocks, ETF’s, and crypto. And less than 10%…in options. More on that another time.
I was listening to Jeremy who is on Millenial Money, and one point he made is that you NEVER know when a stock or whole market will crash. Just be careful out there and do your research.
90% of my stock portfolio is in Robinhood right now, but I also have some on Public, WeBull & TD Ameritrade. If you’d like to get free stock on Robinhood, you can join at this link.
Robinhood really gets a bad rep from a business standpoint, but in my opinion, it is the easiest and most fun one to use. And yes, I do think that matters. And yes, I’m okay with the gamification of it.
And if you want a free stock on Public, join here.
I really like both of these apps, and I’m excited to start using Public more.
Anyways, thanks for reading, and I hope this helps.
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