12 Investing/Trading lessons I learnt in my Life
As a part of my daily work as an equity sales, I have the chance to look at thousands of investors portfolio from various walks of life, ranging from 3 figures to 8 figures.![]()
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The shocking fact is that majority of them is still losing money despite some having “Years of experience in the market”.![]()
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Below are some of the things that made me understand much deeper about trading/investing through my work and I hope can provide some valuable insights to you as well.
The shocking fact is that majority of them is still losing money despite some having “Years of experience in the market”.
Below are some of the things that made me understand much deeper about trading/investing through my work and I hope can provide some valuable insights to you as well.
Number 1 : Everyone should invest BUT Not Everyone Is Suitable to Invest.
Sometimes Saving is better than investing
Many investors beginner or veteran still often make mistakes just buying and selling stocks that they don’t even understand. They don't know what price to buy, why to buy this stock and when to sell.
Basically, they trade for the sake of trading.
They think that stock market is a place to buy and then make money. ???
Some even bought penny stocks and hope it increases by 100 to 10,000%?
Over the years, not only did they lose a ton of money. I have seen people going to debt due to losses and unable to pay, or just losing money on a consistent basis.
These group of people are better off with just saving money and putting into Fixed deposit or MMF. Nothing wrong with low returns instrument, its just that not everyone is suitable to invest/trade.
Sometimes Saving is better than investing
Many investors beginner or veteran still often make mistakes just buying and selling stocks that they don’t even understand. They don't know what price to buy, why to buy this stock and when to sell.
Basically, they trade for the sake of trading.
They think that stock market is a place to buy and then make money. ???
Some even bought penny stocks and hope it increases by 100 to 10,000%?
Over the years, not only did they lose a ton of money. I have seen people going to debt due to losses and unable to pay, or just losing money on a consistent basis.
These group of people are better off with just saving money and putting into Fixed deposit or MMF. Nothing wrong with low returns instrument, its just that not everyone is suitable to invest/trade.
Number 2 : Compound investing doesn't always work out like you planned
Perhaps The Most common thing you have seen many investors/Gurus/books/ financial advisor preaching is this idea of compound interest, The Eight wonder of the world + using Warrant Buffett / Albert Einstein quote and picture
where if you put this fixed amount monthly or year into the S&P 500 index there will be a figure and graph showing you hundreds of thousands to millions of dollars by the time you reach age > 50 and above. But can you guarantee you follow the plan and do it for decades?
Unless you use RSP to do it for you for 20,30, 40 years continuously. If not, it isn’t as easy to as what people preach, especially during recession, economic downturn, market uncertain, personal problems and issues will all affect greatly you to invest at a regular interval without your emotion interfering.
Nothing is guaranteed in life.
Number 3: Its okay to Lost Money
Losing money in the market is extremely normal . But most importantly, what did you learnt?
A lot of new beginners who stepped into world of investing/trading. Their initial thought is always filled with excitement to make a lot of money. Unfortunately, that couldn’t be further away from the truth. In the world of trading/investing to make money you must also be prepared to lose money as well. If you don’t, you are being unrealistic.
Losing money in the market is extremely normal . But most importantly, what did you learnt?
A lot of new beginners who stepped into world of investing/trading. Their initial thought is always filled with excitement to make a lot of money. Unfortunately, that couldn’t be further away from the truth. In the world of trading/investing to make money you must also be prepared to lose money as well. If you don’t, you are being unrealistic.
Number 4: Investing/Trading most likely won't make you rich
Heavily influence by social media, many individuals think that they could become rich by investing or trading. Many have false belief that they could start with very little capital and turn those to millions.
If you take a look at the rich people you know. Majority of them did not become rich by investing or trading. Most of them earn their wealth through business.
It is another thing if you wish to work in professional level but to become wealthy you need some sort of business/job that give you a high level of income.
Investing/trading is another valuable skill to learn to grow your existing wealth.
Heavily influence by social media, many individuals think that they could become rich by investing or trading. Many have false belief that they could start with very little capital and turn those to millions.
If you take a look at the rich people you know. Majority of them did not become rich by investing or trading. Most of them earn their wealth through business.
It is another thing if you wish to work in professional level but to become wealthy you need some sort of business/job that give you a high level of income.
Investing/trading is another valuable skill to learn to grow your existing wealth.
Number 5: Your starting Capital does make a difference (Unlike what other people told you)
This is a lot heavily emphasize by financial guru that you don’t need much to start. Some even mention that you can turn few hundred dollars into thousands or more. Truth is this require you take an extraordinary amount of risk and is easier for very small portfolio to do that because it is okay to loss that amount if things don’t work out but that doesn’t really apply to portfolio of $100k (for example). Not to mention it is hard to consistently achieve 100 to 1000% returns without taking excessive risk.
Capital becomes visibly important when you see the dividends you get from your dividend’s stocks. Even if you put a $1m into MMF with annualized rate of return of 3%. That is $30k paid to you annually (which can be someone annual income)
A 10% on 100 is just $10
A 10% on 10,000 is $1000
but a 10% on $100,000 is $10,000
Contrary to what people believed in capital does make a difference.
Number 6: Investing / Trading is one of the hardest games in the worlddd
Investing is more about selecting the right stocks and hold it with patience while trading requires demands skills, experience and knowledge to make it work consistently. It is known as one of the hardest games in the world with millions and billions of dollars poured into firms to find out how to beat the index / beat the market consistently. Many still fail to do so.
These high level prop firms, hedge funds and asset manager are equipped with well-trained team, high level technology & algorithms, connections and information. So as an individual retail trader it is extremely hard and competitive to outperform the market on a consistent basis without any edge.
Investing is more about selecting the right stocks and hold it with patience while trading requires demands skills, experience and knowledge to make it work consistently. It is known as one of the hardest games in the world with millions and billions of dollars poured into firms to find out how to beat the index / beat the market consistently. Many still fail to do so.
These high level prop firms, hedge funds and asset manager are equipped with well-trained team, high level technology & algorithms, connections and information. So as an individual retail trader it is extremely hard and competitive to outperform the market on a consistent basis without any edge.
Number 7: Beginner Traps To Avoid ![]()
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I personally have met many people who are new to buying stocks / the stock market in general. Many just wanted to jump straight into trading short term to earn consistent profits every month. (eyes roll)
For beginner, I would recommend start with investing for the long term first since you are very new to the market and better to learn the concepts and terminology to refine your understanding and skills before even considering short term trading.
Of course, many beginners tried short term trading or trading in general and majority lose money wondering why did that happen.
Maybe a good question you can ask yourself is:
1) what edge/strategy did you possess to earn you money on a consistent basis
2) Do you have a well-constructed trading plan to follow?
3) Do you have very strong understand of economics, company fundamentals, charts technical and able to linked those information together to form an unbiased judgement of certain prices movement?
If not, what makes you think short term trading will work out for you??
I personally have met many people who are new to buying stocks / the stock market in general. Many just wanted to jump straight into trading short term to earn consistent profits every month. (eyes roll)
For beginner, I would recommend start with investing for the long term first since you are very new to the market and better to learn the concepts and terminology to refine your understanding and skills before even considering short term trading.
Of course, many beginners tried short term trading or trading in general and majority lose money wondering why did that happen.
Maybe a good question you can ask yourself is:
1) what edge/strategy did you possess to earn you money on a consistent basis
2) Do you have a well-constructed trading plan to follow?
3) Do you have very strong understand of economics, company fundamentals, charts technical and able to linked those information together to form an unbiased judgement of certain prices movement?
If not, what makes you think short term trading will work out for you??
Number 8: Sometimes not doing anything is the best thing to do (itchy finger, keep trading)
I believed most people when starting out investing/trading have the bad habit of constantly watching your portfolio and feeling like you need to do something to get hold of opportunity or more trades to make more money.
Most of the time, not doing anything is the best thing because constantly finding things to trade or intraday trade position constantly can result in overtrading and make thigs a lot worse.
If you are trading, only trade when there is opportunity or setup for you to enter.
For investing, if you buy the right stock at good price. You just need to ignore and let time do its work. (Easier said than done)
I believed most people when starting out investing/trading have the bad habit of constantly watching your portfolio and feeling like you need to do something to get hold of opportunity or more trades to make more money.
Most of the time, not doing anything is the best thing because constantly finding things to trade or intraday trade position constantly can result in overtrading and make thigs a lot worse.
If you are trading, only trade when there is opportunity or setup for you to enter.
For investing, if you buy the right stock at good price. You just need to ignore and let time do its work. (Easier said than done)
Number 9: Just Keep Things Simple
Sometimes we are being told by internet and the gurus that there is this indicator and that new indicator to use. Told that we have to use Fibonacci, MACD, RSI, Bollinger band, stochastic , or even teacups pattern, etc.
In the end, we try to learn too many things at one time with 20 indicators in one chart filled with various information , overcomplicating things and learn nothing in the end.
Just start with the basics like price action for trading and value investing for long term investment for start and slowly learn to work your way up.
mostly important is to know what you are using, why you are using ,what you’re using and find the connection between indicators and various tools used
Number 10: Have your own personalized plan/ system (Inlcudes how much to save every month, short term and long term goals, )
No matter if you are trading or investing. You need a plan to follow and work with if not you are just doing things blindly or based on feelings without logic being put into it.
You can either come up with your own system or plan. If not you can simply copy others and make adjustment to suit yourself and find out how it works.
If it works, find out how to make it work even better.
If it doesn’t work, find out what is wrong and what to change to make it work.
Sometimes we are being told by internet and the gurus that there is this indicator and that new indicator to use. Told that we have to use Fibonacci, MACD, RSI, Bollinger band, stochastic , or even teacups pattern, etc.
In the end, we try to learn too many things at one time with 20 indicators in one chart filled with various information , overcomplicating things and learn nothing in the end.
Just start with the basics like price action for trading and value investing for long term investment for start and slowly learn to work your way up.
mostly important is to know what you are using, why you are using ,what you’re using and find the connection between indicators and various tools used
Number 10: Have your own personalized plan/ system (Inlcudes how much to save every month, short term and long term goals, )
No matter if you are trading or investing. You need a plan to follow and work with if not you are just doing things blindly or based on feelings without logic being put into it.
You can either come up with your own system or plan. If not you can simply copy others and make adjustment to suit yourself and find out how it works.
If it works, find out how to make it work even better.
If it doesn’t work, find out what is wrong and what to change to make it work.
Number 11: Don't be ignorant , Be open minded
In the world of trading and investing, there is always room for improvement and in terms of both skills and knowledge.
Do not shut off to other people ideas just because they have lesser experience that you.
The highest level of trader/investor understand that the more he learns, he more he realized how much he don’t know.
In the world of trading and investing, there is always room for improvement and in terms of both skills and knowledge.
Do not shut off to other people ideas just because they have lesser experience that you.
The highest level of trader/investor understand that the more he learns, he more he realized how much he don’t know.
Number 12: Money is kinda like a scam and it is not Everything ![]()
Saw a YouTube video about money and it really spoke about the truth. It says:
Money doesn’t typically come from hard work. Money comes to those who hoard it.
Money comes to those who are willing to exploit.
Billions of people live on this planet work hard every single day will live and die broke. To the big tech giants like Apple and Amazon , who will pay top dollar for a coder behind a desk in Seattle but will pay close to nothing for hands of those that work tirelessly to mine the materials that make our devices function and to deliver our packages cheaply.
To living in a society where it is legal to pay both disable workers and essentially workers less than minimum wage. They way we deal with money in this society is a scam.
Saw a YouTube video about money and it really spoke about the truth. It says:
Money doesn’t typically come from hard work. Money comes to those who hoard it.
Money comes to those who are willing to exploit.
Billions of people live on this planet work hard every single day will live and die broke. To the big tech giants like Apple and Amazon , who will pay top dollar for a coder behind a desk in Seattle but will pay close to nothing for hands of those that work tirelessly to mine the materials that make our devices function and to deliver our packages cheaply.
To living in a society where it is legal to pay both disable workers and essentially workers less than minimum wage. They way we deal with money in this society is a scam.
If you read till the end, thank You I hope you gain at least 1 financial brain cells from this ![]()
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Posting Weekly content- Currently a part-time finance student
Swing Trades + Long-term investing
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sociable Dingo_8604 : Well said @Brianjh
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
I totally agree with all the above especially 1, 5, 6 & 8. They resonate with me and my thoughts. I need to save this post
KK1989 : Thank you for the reminder.
103383658 : good read!
scarlight : it is not ok to lose money. This is a terrifying advice.
102747798 : Bravo. Well said.
Thanks for sharing your thoughts.
I can resonate with some of the points.
Wish you the best!
玄学炒股的美股韭菜 : Golden words.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
NeedaCoffee : Thank you! I also believe that for beginners like myself, there is still lots to be learnt, it’s like surfing, it’s a fun and exhilarating sport but yet not for everyone, and also you gotta pick up the basics first before you can ride the waves.
I learnt that through the hard way lol, anyhow buy and lose money. Now I go back to the basics, looking at the fundamentals of the company and invest for consistent growth in the long run. Totally relating to what you shared here.
I don’t have 1 million to throw in and whack haha 
I never knew investing was an option I could take until I can onboard.
But honestly I think this app also helped me a lot, to learn, hear from people like you and also gives me a chance to practice first with small money
73514967 : Nice article! Thanks for advice for beginners.
101667935 : Thank you for sharing!