0/19 Thread
FOR THOSE OF US THAT SUCK AT TRADING
On Investing versus Trading in Crypto/Stocks
Principles
Warnings
On "Traders"
On "Tech"
FOR THOSE OF US THAT SUCK AT TRADING
On Investing versus Trading in Crypto/Stocks
Principles
Warnings
On "Traders"
On "Tech"
1/19
I've had investments for 20 years -- my father is a financial advisor and he always showed me charts. I had $50 of Walmart and $50 of McDonald's stock when I was 10 years old. He told me to not look at my portfolio often -- check back every couple months.
I've had investments for 20 years -- my father is a financial advisor and he always showed me charts. I had $50 of Walmart and $50 of McDonald's stock when I was 10 years old. He told me to not look at my portfolio often -- check back every couple months.
2/19
The deeper I go into investing, the more equations and ratios I learn, the more "gurus" and OG's I come across, the more I try to "trade" ... I always end up falling back on a few principles:
The deeper I go into investing, the more equations and ratios I learn, the more "gurus" and OG's I come across, the more I try to "trade" ... I always end up falling back on a few principles:
3/19
My principles (my STYLE)
1. Buy what is growing and will be thriving in 3-5 years.
2. Buy a CEO/community leader that is obsessed with winning.
3. Buy a cult.
*Bonus: If there is a prevailing bear case that is untrue, I may have an edge.
My principles (my STYLE)
1. Buy what is growing and will be thriving in 3-5 years.
2. Buy a CEO/community leader that is obsessed with winning.
3. Buy a cult.
*Bonus: If there is a prevailing bear case that is untrue, I may have an edge.
4/19
I bought Facebook at 28. I didn't wait for the perfect entrance, I didn't look at
the P/E ratio (probably wasn't profitable yet), and the general public consensus was that it was overvalued and a fad. To me, Facebook was a massive part of life and consumed a lot of my time.
I bought Facebook at 28. I didn't wait for the perfect entrance, I didn't look at
the P/E ratio (probably wasn't profitable yet), and the general public consensus was that it was overvalued and a fad. To me, Facebook was a massive part of life and consumed a lot of my time.
5/19
FB consumed a lot of my friends' time. It was growing its userbase at a rapid rate and it didn't seem to have much competition in its space. Zuckerberg seemed sharp to me, and when he made the move to buy Instagram before the IPO, I was convinced he was playing to win.
FB consumed a lot of my friends' time. It was growing its userbase at a rapid rate and it didn't seem to have much competition in its space. Zuckerberg seemed sharp to me, and when he made the move to buy Instagram before the IPO, I was convinced he was playing to win.
6/19
On top of this (*Bonus), the bear case on Facebook around Wall Street was that they were NOT going to be able to learn how to advertise on mobile.
Yes, this was seriously the end-all argument at the time. That Mark Zuckerberg was not going to figure out how to make money
On top of this (*Bonus), the bear case on Facebook around Wall Street was that they were NOT going to be able to learn how to advertise on mobile.
Yes, this was seriously the end-all argument at the time. That Mark Zuckerberg was not going to figure out how to make money
7/19
advertising on your phone. I remember being absolutely dumbfounded
with what I was reading -- articles written by "experts". It reminds me of today when "respected analysts" on Wall Street talk about Bitcoin and say things like "Bitcoin's transaction fees are too high"
advertising on your phone. I remember being absolutely dumbfounded
with what I was reading -- articles written by "experts". It reminds me of today when "respected analysts" on Wall Street talk about Bitcoin and say things like "Bitcoin's transaction fees are too high"
8/19
and "Bitcoin uses too much energy" as bear arguments where they proclaim cryptocurrency dead. So you're telling me the smartest humans on earth rushing to this space aren't going to eventually figure out how to lower transaction fees and use less energy?
and "Bitcoin uses too much energy" as bear arguments where they proclaim cryptocurrency dead. So you're telling me the smartest humans on earth rushing to this space aren't going to eventually figure out how to lower transaction fees and use less energy?
9/19
I'm a momentum player. I don't buy for "value". It's not for me. I don't knife catch. I add to my positions when I am more confident in the company/product, and I deal with a downswing or two if my entrance isn't perfect.
I'm a momentum player. I don't buy for "value". It's not for me. I don't knife catch. I add to my positions when I am more confident in the company/product, and I deal with a downswing or two if my entrance isn't perfect.
10/19
And this has worked for me. Call it confirmation bias or whatever you want, but I accept that this is my current style.
And this has worked for me. Call it confirmation bias or whatever you want, but I accept that this is my current style.
11/19
ON TRADING/TRADERS
I dabbled in active trading for a couple years, and mostly got crushed. I learned relatively quickly that I am not built to be able to handle emotions on the fly when it comes to money. I tried poker
ON TRADING/TRADERS
I dabbled in active trading for a couple years, and mostly got crushed. I learned relatively quickly that I am not built to be able to handle emotions on the fly when it comes to money. I tried poker
12/19
as well, and I had a similar experience. I tilted hard and lost my ass. I am still eternally jealous of the 0.1% of poker players and traders that can handle the swings and be profitable year in and out. I want that skill. But deep down I know this is not me.
as well, and I had a similar experience. I tilted hard and lost my ass. I am still eternally jealous of the 0.1% of poker players and traders that can handle the swings and be profitable year in and out. I want that skill. But deep down I know this is not me.
13/19
KNOW THAT If someone entered crypto in 2015, 2016, or early 2017, chances are they have made money. The multi-year trend is way up.
Be wary of these "traders" on twitter. See if they have an account on copy trader sites and if they are
KNOW THAT If someone entered crypto in 2015, 2016, or early 2017, chances are they have made money. The multi-year trend is way up.
Be wary of these "traders" on twitter. See if they have an account on copy trader sites and if they are
14/19
are actually profitable in the short and medium term. Make no mistake: they made a good INVESTMENT early on. Their short-term decisions are less imporant and very well may be reducing their overall haul.
A rising tide lifts all boats.
are actually profitable in the short and medium term. Make no mistake: they made a good INVESTMENT early on. Their short-term decisions are less imporant and very well may be reducing their overall haul.
A rising tide lifts all boats.
15/19
And chances are, some have run better than others, and they are KILLING it.
Only a tiny % of them significantly increased their gains from actively trading.
I'm still trying to filter out the voices in crypto that don't give good advice and a balanced picture.
And chances are, some have run better than others, and they are KILLING it.
Only a tiny % of them significantly increased their gains from actively trading.
I'm still trying to filter out the voices in crypto that don't give good advice and a balanced picture.
16/19
My goal for crypto in 2019 is to pay attention to the coins that are following my principles:
1. Is this cryptocurrency growing, and will it be thriving in 3-5 years?
2. Is the community leader making aggressive, important moves and winning?
3. Is a cult being created?
My goal for crypto in 2019 is to pay attention to the coins that are following my principles:
1. Is this cryptocurrency growing, and will it be thriving in 3-5 years?
2. Is the community leader making aggressive, important moves and winning?
3. Is a cult being created?
17/19
Notice how the "TECH" isn't one of my principles in crypto. Stop looking at the tech.
No one cares if Samsung has better "tech" than Apple. Steve Jobs showed the obsession to win, made decisions to grow aggressively, and he created a cult.
Notice how the "TECH" isn't one of my principles in crypto. Stop looking at the tech.
No one cares if Samsung has better "tech" than Apple. Steve Jobs showed the obsession to win, made decisions to grow aggressively, and he created a cult.
18/19
Mark Zuckerberg grew his cult and bought every competitor in his path.
Where are the companies that had better "tech" than FB?
Mark Zuckerberg grew his cult and bought every competitor in his path.
Where are the companies that had better "tech" than FB?
19/19
Cryptocurrency may dip in the short term. We may see a $5,000 BTC in the short term. That would suck.
But ask yourself those 3 questions about this space as a whole.
Where is this thing going?
Cryptocurrency may dip in the short term. We may see a $5,000 BTC in the short term. That would suck.
But ask yourself those 3 questions about this space as a whole.
Where is this thing going?
