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Sunday, April 24, 2016

Introduction

There are no safe investments in this world.

Investing in stocks is a risky operation for the uneducated. It takes more than simple common sense and can be emotionally draining.

My first attempt in investing was done based on chart reading, and like every first investment, it was deceptively easy. To quote Bill Gates, you usually don't learn much from successes. Easy successes in the stock market are usually pre-cursors to large, daunting failures.

This is a game which you are going to make lots of mistakes. But yet it is a game that most small to median income earners are forced to play (I can't speak for high net-worth individuals). After my early failed attempts at trading, I have adopted value investing as it suits my temperament and lifestyle.

There are successful traders out there, but mathematically they will probably methodically cut losses in 7/10 trades and win 3 in order to be profitable. It also must involve leverage (borrowings) in order to make sense in trading. If you are looking to earn 3-5K USD with trading, it is possible. It takes a lot of heart to trade, and an apprenticeship is necessary. I possess neither.

It is very fair, you need huge money to earn money, be it investing or trading. And within each field, only the best earn spectacular returns. Life is unfair in many ways but this is the exception.

I have many, and I expect more along the way. These failures rewarded me with lessons that hopefully will serve me well in the future.

This blog shall serve as a collection of the lessons that the stock market offered to me, as well as my thoughts.


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