In no way do I think I'm an expert investor. I can say that I've accumulated quite a lot of knowledge through years of investing. You learn lessons over time through experience. I've made money and I've lost money. One of the greatest lessons I believe you can learn about investing is that emotions have no place in it. Emotions are evoked by thought. Thinking positive thoughts raises positive emotions, thinking negative thoughts raises negative emotions. Neither positive or negative thoughts help you make a sound decision based on fact.
For example, when the IOU share price rocketed up to 80c my thoughts were, "Wow, this is great I'm making so much money". That's a pretty positive thought, mixed with a positive emotion. What generally follows is an action of greed. "If the share price keeps going up, I'll make even more money so I better not sell yet". Conversely, when the share price drops most people are thinking, "WTF is happening, this is a crap business with crap management". What usually follows is an action of desperation, "I'm going to sell before I lose even more money". Or as we've seen, "I'll go and post a lot of negative things online".
The lesson is; the way you think determines what your actions are whether it be positive or negative. Personally I have a plan before I buy shares in a company. If the price rises by X% I'll sell X%. If the price drops by X% I'll close my position and reassess. I mentioned that I sold some after the IOU share price increase and this was directly a result of my rules. This isn't a black and white rule because circumstances continuously change. Maybe the share price went higher because of some fundamental change and the underlying asset is now more valuable so I don't want to sell as many shares. In those circumstances I'll pay myself a commission for finding the investment opportunity. Again, this will be a percentage of the increase albeit a lower percentage than if the increase was based on hype rather than a fundamental change. If I didn't have these rules or guidelines my thoughts, both positive and negative would dictate my actions and the result would be unpredictable.
There's a reason why institutions make money year after year. It's because they don't let thoughts control their actions. They have processes and guides that help determine their actions. Retail investors are basically Sheep being led around by the brokers/institutions which are basically the Sheppard's. Sheep don't do a lot of thinking. Sheppard's generally get the Sheep to do what they want. Set yourself some rules and become a Wolf in Sheep's clothing.
This is by no way intended as financial advice. Just sharing my experiences and opinions. Please dyor.
IOU Price at posting:
21.3¢ Sentiment: Buy Disclosure: Held
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