Curious to try your hand at the volatile stock market? Learn from my mistakes before you do!
Why should you take stock market investing from me?
Honestly, you shouldn’t. I know so little (started Jan 2021) and none of my investing success is attributed to any real knowledge. I kinda really just got lucky (so-to-speak). So you can just close this tab now and do something more productive with your time.
But for you crazy clowns who love reading all my bullshit pseudo-advice…continue on at your own risk.
DISCLAIMER: this is not real financial advice and I am not a registered financial advisor.
I really am a noob. Not a savvy intermediate investor calling himself a “beginner” to appear humble. I’m a dumbshit noob. Maybe I tried stocks 20 years ago. And then again 10 years ago. But I never committed seriously to it. This time, I did. I threw 5-digits worth of money and actually made even more money and learned some things. After hating stocks for years, I now bitterly admit that it’s an easy and fun way to make money.
But how much of what I learned will help you…nobody knows. I still don’t know proper terminology. I confuse facts with opinions. And sure as hell probably not referring or understanding how many aspects of the market actually works.
Like I said…continue at your own risk!
TIP #1 – how much money to start?
How much money do you need to start investing?
This is a sticking point for many people. They think they don’t have enough to make any real financial impact. And this is only somewhat true. Sure…a safe stock portfolio will net you only 10% returns annually and that’s literally nothing. Whatever you put in will take 7-8 years to double. (Barely beating the rate of inflation.)
And for me…f**k that. I don’t want to die rich. I want to live rich.
Most of us aren’t wealthy. We’re average folks with anywhere from $5-50k of free cash. And trust me, that’s plenty to get started. The idea is to bet risky. Some will lose, some will win so big and cover all losses. You can easily multiply your starting investment by 3-5x. Then take that and gamble again…except now since you have more money, you can diversify even more…and some are bound to win.
It looks like this:
- Start with only $1k.
- Put it in 5 different stocks. 1-2 solid ones, 2-3 risky ones.
- Solid ones grow slow. Risky ones can blow up.
- You’ll have double or tripled your initial investment in a couple months.
- Put it back in again and pick more stocks…on the next run you make 3-10x.
- Having more money allows you to double down on the solid ones and leaving lots of extra change for the volatile penny stocks.
$1k becomes $3k, which becomes $15k, then $50k, $200k, etc.
- Is it really that easy? For some people yes.
- For the losers, no. They might lose anywhere from 20-70% of their investment.
- Of course…I do my best to help you not lose.
ALWAYS RESERVE CASH!
Aghhhhh, this is such a huge tip. I lament missing out on many easy opportunities because of this.
Most people when starting to invest will throw down all their money into one or two stocks. They just buy right into one stock without knowing what part of the cycle the stock is in (up-cycle or down-cycle).
In a situation like this, you’ve blown all your money into one stock and now only capable of benefitting from one outcome, which is the stock goes up! But you miss out if the stock goes down (you’re unable to buy more while it’s cheap). You also miss out if another stock becomes available or dips during this time. Basically…you can’t buy anything else when all your money is held up.
So how would I do it differently?
- Buy using only 50% of your available investment fund. (If you have $1k to invest, buy with only $500 of it.)
- Then buy more stock when it dips. Again don’t blow all your cash. Reserve some in case it goes lower or some other new stock comes out!
- The more you invest, the more people you talk to, and the more “new opportunities” you will have to invest.
The lower you buy, the more you have to gain. Duh!
TIP #2 – sign up for brokerage
This is the second biggest friction point for people. They don’t even know where to get started. It sounds like something super complicated and technical. Which it is, but web services have made it so easy now.
Exchanges are marketplaces where you can buy different stocks (or crypto coins). You can think of it as department stores. Some stores sell certain brands, other stores sell other brands. You sign up for multiple brokerages and exchanges so you’re able to buy all the stocks you want. (Keep in mind different countries may have to use different brokerages/exchanges.)
Traditional stock brokering services (e.g. Robinhood, Fidelity, Ameritrade) are to buy traditional stocks…like Apple, Amazon, etc. Although they do sometimes offer crypto coins on there…but it’s better to buy crypto from actual crypto exchanges.
- Pick Robinhood as it’s the easiest. It’s like opening a PayPal account.
- Then you connect your bank account.
- Then transfer funds from your bank account to your brokerage account.
- Then start investing from your brokerage account. Look up company ticker symbols you want to invest in (For example Apple’s symbol is AAPL). Buy and sell whenever you want. Transfer money back out to your banking account anytime.
Usually beginners will start with Robinhood. Intermediate traders go to Webull. The serious day-traders/swing-traders will go with Ameritrade or Fidelity.
What’s the difference? Their ease of use and options. Newbie services with very little options, easier terminology, and cuter easy-to-understand charts. More advanced tools let you set automated limits of when to buy and sell. Also they allow you to trade for longer hours of the day (useful for taking advantage of quick spikes or dips during after hours). There’s more differences too but I don’t know how to explain. Robinhood is really fine for my use…even though “it’s the devil” (you can read up on it later).
You really don’t need to study any investing terminology/books anymore like you did back in the old days. In the old days, making a simple buy required like 20 things to fill out and you paid a transaction fee on each buy/sell. Now, you simply open up your app and decide which stock and how much to buy or sell. Takes 2 seconds. Also, super easy to follow your charts to know if you’re up or down.
Anybody can invest! You can start with $1k.
TIP #3 – what the f**k is crypto-currency?
Crypto currencies are digital economies.
I know some basic idea what crypto is…but not so much everything that it does. Because it keeps being redefined and used to do more and more complicated things. But will do my best to explain what little I know.
Long time ago (2009), some dude created a decentralized digital currency as an alternative to the corrupted fiat money we have today. (“Decentralized” meaning that the currency wasn’t controlled by any one individual or organization.) He was tired of crooked financial systems (banks/governments) inflating money and causing market crashes whenever they felt like. Because every time they do, people lose their assets like houses/businesses…resetting everyone into debt and poverty so they can work their way up again for the scraps given out by the elite.
So at first…crypto currency was intended just to be another form of fake money, that wasn’t owned and couldn’t be manipulated by anyone. But then people started noticing many other benefits of the technology (blockchain technology) used to build cryptocurrency. I’ll list some benefits below…
- Can buy and sell things (like “real money”).
- Lower cost of transaction…during sales or money transfers.
- Privacy…can send money and nobody knows who the sender or receiver is.
- Not exactly tax-free in every country…but how would your government know? 🙂
- Can be reinvested/redelated into mining, staking, farming to make more free money off the existing money. Think of it like traditional bank CD’s…but with much better returns. (I watched my friend make 60% in one week practically risk-free.)
- Can lend it out. Basically become your own bank.
- Control – you have full control of it. Since the crypto isn’t controlled by any one organization.
- FYI, there’s so much more to it than this…you can read up on it for yourself.
The long story short is that I compare cryptocurrency to the economies of different countries around the world.
Take the USA for example. It’s a whole country with its own economy (goods, imports, exports, services, etc) and has its own currency (the US dollar). And the value of the US dollar is greatly reflected by how well the US economy is doing.
Ok, cryptocurrency is somewhat similar. Except they’re location-agnostic and separated by their projects/platform rather than by geographical boundaries. Take Ethereum for example. It’s a whole platform that can do many things and many sub-things related to sending, receiving, and processing money. Its platform also has its own coin (“ETH”). Cardano project has its own coin “ADA”. Even Binance exchange has its own coin stock “BNB”. All these different companies have their own crypto coin (currency). Kinda like how every public US company has their own stock.
What determines the value of a crypto coin?
- Success – by how well its project is doing. If it’s used massively.
- Speculation – by how well the public thinks the project is doing. There’s also many blind investors who buy ETH without knowing what it does or how it works.
- There are literally “meme coins” (like DOGE or SHIB) that aren’t built on any platform or do anything useful. They are empty fake paper coins that got big in value because people bought it as a joke but then because it made real money, more people bought in.
So you need to know what coins have real projects behind them, which ones are only jokes, and which ones are only promises. I know…it’s hard to tell. Because every cryptocurrency website makes promises like they’re gonna change the world with their technology, etc. It’s not unlike new EV (electric vehicle) companies popping up saying they’re gonna beat Tesla while not haven’t built even a prototype yet.
Crypto exchanges are different. They sell only crypto currency & NFT’s.
- There are many and some are limited to only certain countries.
- I highly recommend you sign up on all of these: Coinbase, Binance, Gemini, Crypto.com, KuCoin.
- Why not just one of them? Because many of the coins I buy are only available on some. Also too…their interface can differ greatly from one platform to another and it’s good for you to get acquainted with all. Coinbase/Gemini are easiest. Binance, Crypto.com, KuCoin look hard.
- When you become a pro, you’ll probably use decentralized exchanges like UniSwap. They’re more complicated to use (have to connect a wallet) but have many more currencies and allow you to swap from any currency to another…whereas other exchanges maybe only allow you to buy from US dollar.
What is a crypto wallet?
It’s a digital wallet that you store your crypto currency in. Starting investors won’t have to deal with this but I recommend you get one once you have over $10k. Storing your crypto in a “wallet” is safer than just leaving it in your exchange because it’s less chances of someone hacking into your exchange account and sending all your crypto to their accounts.
Only drawbacks with wallets is that it’s annoying to send things back and forth. There’s also fees for sending. They also don’t have fancy charts to show your gains and losses. Although you can get around that with wallet trackers like Delta.
For newbies, I recommend you get MetaMask. Just have it for now and then start using it later when you need to do complicated swap-trades. I would also recommend a “cold wallet” (fancy Ledger Nano X, cheap one Ellipal) once you have more money than you’re willing to risk losing.
Other ways to make money with crypto – mining, farming, staking.
There are so many ways to make money with crypto and I keep learning of more and more methods. It’s not just buying and selling stock (coins).
- Mining – is when computer resources are dedicated to solving algorithms to be rewarded in free coins. You can build your own mining farm (set up custom rigs to process 24/7), I probably wouldn’t do this. Or you can invest in mining stocks or mining pools (basically paying others to mine for you and split profits). I never tried. I think their profit isn’t worth it anymore.
- Farming – get rewarded for providing liquidity to the market. Basically you convert your tokens to rarer ones and get rewarded in a percentage split of fees charged to people who paid to convert through those coins. You can easily make 10-60% returns per week but there risks. You could lose out on market gains on more stable coins. For this reason, farming is more recommended during bear seasons.
- Staking – everyone should do this. Safe 2-8% returns for delegating your coins into its network. Think of it like a traditional bank CD except only you can pull out (almost) anytime. You also get lots of freebies, airdops and other free coins. Depending on how you do it, you can also get much more. I don’t always stake because I’m a lazy ass, but the big ones I definitely do. Staking can be automated on some exchanges, require a few clicks on others, or a total PITA (wallet transfer and 5-8 clicks to delegate). Once you got over 30-40 different coins, you gonna get lazy.
Traditional stocks or crypto?
I would do both. Lots of money to be made everywhere. For me crypto is way more volatile and therefore, lots more opportunity to be made. It skyrockets higher (for profits), and crashes lower (for buy-ins). Regular stock is less volatile and less work to be done if you want to day-trade. Crypto is a bit wild and you find yourself with more opportunities to game the system. All depends on how active you want to be.
TIP #4 – don’t listen to anybody you don’t know (personally)
Oh if only I knew this 20 years ago!!!
There are so many gurus/experts/world-renown so-called stock analysts out there. All of them being touted as prophetic with “1371% average annual gains”, and such and such incredibleness. I say you ignore these motherf**kers.
Because at BEST, you will break even. And most likely, you’ll end up at a loss because you’d only be doing what most sheep investors are doing…just “following the trend”. You’ll end up buying too late (when prices are high) and selling too late (when prices have fallen).
Use your common sense. If these guys had such great advice, why would they sell it to you for $59 a month? Shouldn’t they be keeping that info on the down-low and keep all their millions to themselves?!!
So I say you do what I do. Find a friend who you trust. Buy what he/she buys. End of story. Your middle class friend who’s investing $100k of their hard-earned money…THAT’s the person to trust! Because you know damn well they did their homework and already spent lots of personal trial-and-error to know what they know. Your friend is hoping to have financial success and would probably be glad to help out a fellow friend.
The only hard part is that many people (unless they’re scammy) are afraid to advise close family/friends. They don’t want to be responsible for someone close to them losing money. Just so I make this clear…my youngest brother with six figures in investments refuses to give me any advice at all. My cousin who made 7-figures before age 25 is absolutely hush-hush as well. Many successful people simply don’t brag.
Why NEVER to listen to the big name celebrity analysts/advisors…
Because they’re lying sacks of crap. Many of them work for or with big funds that directly invest in the same stocks. Often using their friendly loudmouth guy to manipulate the market in 2 ways:
- Pump the stock – they buy the stock at a low price, then tell everyone else it’s a great buy. Their stock goes up when you buy.
- Dump the stock – then after they’ve already sold at its high point, they’ll tell everyone the stock is a bad buy. Causing people to panic sell and dropping the price. (So they can buy right in again.)
And thus you understand the “pump and dump” saying. I’m sure there’s way more detail to it but you can read up on that later from people who know much more than I do.
I like the Palm Beach Research Group.
They deserve a special mention. They have free email newsletter tips and what not. But they also have a premium report service. Costs like $15k and totally worth it. My friend bought LUNA at $0.27 thanks to them (it’s $34 now).
There’s just so many new stocks coming out there that there’s no way in hell you can search and research all of them. So having a professional group run these things for you is so invaluable. You can easily 100x things just because you were 2 months earlier than everyone else.
Whatever stock picks this group mentions, I throw $100-$1k at each one and you easily make 3-100x times back within 3-12 months. (Of course, not all of them hit it big but all it takes is one winner to send your portfolio to the moon.)
Who does WPJohnny listen to?
- Raj (friend) – a writer I knew from my old PR firm job back in 2010.
- Gareth (friend) – a British retired guy. Also ex-fighter and tech guy like myself.
- Random finance professor I met in a hostel.
- PalmBeachGroup (reports).
And then I also listen to random people I meet around the world. People who are holding coins and invested in projects I never heard of. You can always tell the casual one-hit-wonder “stock-bro” showing off his Bitcoin asset screen at the club…vs the pro silently trading in the hotel/coworking back corner every morning.
Anytime somebody mentions something I never heard of, I buy it immediately just to see: 1) if I’ll make any more money, and 2) if they know what they’re talking about. I’m not even kidding…I’ve made tons of money off of obscure stock calls from random strangers in passing. I bought blindly and holy shit. WOW! (The best one was the guy who told me to buy DOGE when it was only $0.04.)
TIP #5 – what industries to invest
Don’t invest in industries you don’t know.
I’ve heard this before but never appreciated it until recently. They say you should never invest in companies or sectors that you don’t understand. Like if you don’t understand how they make their money, their business model, where they stand among competitors, and other recent market changes (new products, new players).
You could also add to that to say “you should only invest in companies you’re actually a consumer of”. For many people this means investing in Netflix, Amazon, their car manufacturer, etc. Since if you’re a consumer of a brand, you’re more likely to know whether their product is any good and where they stand against competitors.
How to research companies?
This is a tough one. Because every company is going to do aggressive marketing and PR. Promising you all kinds of things so you’ll invest. They’ll say they’re coming out with the best new electric car. Or that their crypto-projects are gonna release a new game-changing technology soon.
…and then they don’t. Maybe they’re late. Or it’s just empty promises. Or they do release the promise but it wasn’t impactful or a competitor did it better. And people panic and sell off because they don’t believe in the companies anymore.
I’ve watched my friends research things in such clever ways and I won’t even get into that. I’ll just say make it your own art. Figure out how to tell when companies are: 1) telling the truth, and 2) actually on the verge or something substantially exciting.
How SMALL investors diversify.
This is that cliche “don’t put all eggs in one basket” saying you hear everywhere. And it’s true BUT…
It doesn’t apply to everyone. If you’re a beginner investor with only $1k to put in. Are you really gonna spread it across 100 different stocks which you have no research knowledge of? Of course not. That’s stupid. You’re better off with a mutual fund or something.
So what should a small-time investor do with $1k?
- Pick 1 or 2 stocks moderate-risk stocks and put the bulk of the money there.
- Pick another 2-3 risky stocks bet 10-15% of your budget on it.
- Pick another 20-30 stocks and put $1 on each (or favorite them) just so you can have a pulse on them.
Again. $1K isn’t much. Even if you make 100% gain on it in one year (which is huge gains), it’s still only $2K the next year. My point is…if you’re going to bet with a small amount, you might as well bet risky to have a chance of blowing up to money that actually makes an impact in your life. Cuz 10% gains every year off a $1K initial investment isn’t gonna change your life.
I’d say it’s damn near impossible for a small investor to diversify. They don’t even have enough money to make a single impactful investment, let alone spread it into multiple impactful investments.
How BIG investors diversify.
They put a lot of money into safe stocks. Longterm brands showing consistent growth over the years. (Because even 10% gains on their portfolio is enough of to live off of.) Then a couple emerging market leaders. And then they still have cash left over to throw at risky penny stocks.
IMO…it’s these risky penny stocks that allow them to diversify so quickly. Because when you’re able to throw $1-3K here and there in every direction. Many will hover at even point or you’ll lose a bit. But if one hits it big, it easily makes 100x. And like that, they not only have made a giant gain from that one stock and their portfolio looks that much more diversified. The more risk you can afford to take, the more explosive gains you are likely to have.
TIP #6 – long game vs short game
Are these even real terms? (Oh well, I hope you know what I mean.) I think you should invest in all three styles. Best chance of solid gains, and keeps you well-informed on market movements over time. Once you have a good pulse of how things are moving…you’ll be that much more intuitive of how to sense things and decide which investment strategy you want to take for each stock.
Long game (3-5 years):
- Buy a solid stock (Apple, Amazon, etc) and hold it for 3-5 years.
- Guaranteed gains.
- Don’t even look at it. Go about your life knowing these stocks will go up because they belong to companies that reaalllllly care about their profitability.
- You’ll probably get around 100-300% gains in 3-5 years.
- You also pay the lowest tax rate on long term stock gains (holding stock lower than 1 year).
Generally, all solid companies will rise in stock value. Even if you’re buying them during the down cycle, they will eventually come back up (especially with inflation) if you hold onto them long enough.
Long game doesn’t work so well with many cryptocurrencies because a lot of them get overtaken by newer/better projects and may lose all value one day.
Short game (1 day to 1 year):
- There are a wide range of terms for short-term investors. Day-trader, swing-trader, scalper and on and on. You don’t have to learn what they mean. They simply buy and sell on much shorter intervals.
- Short game trading is much more fun. More work and also more rewards. You have to watch the market much more closely…instead of checking in once a month, you’re now watching everyday and sometimes even every hour. I used to hate the idea of this but honestly, it’s no different from you checking your social media apps.
- Throw money at pre-IPO, new-IPO and SPAC launches, and sell off after the immediate surge (1-3 months), or hang on for 6 months or longer if you want to ride the rocket.
- Load up during massive downspikes. It’s common to see stocks plunge 10-30% in one day and quickly recover the next week. As I’ve learned…many fortunes are made during those moments if you have free cash on hand to seize advantage.
My two favorite things about short-term trading is that: 1) It’s more fun. Feels like a game you’re actively playing and with big risks and rewards. 2) You’re more likely to have cash on hand and able to take advantage of other hot stocks. This is actually what “investing” is for me.
Long-term trading just feels like a CD savings account with higher gains. It’s ok if you’ve got a lot of money and want it to make it work for you instead of sitting idle in the bank. But if you’re an average person wanting to LIVE RICH rather than die rich, short term investing is where the action is at. With a bit of due diligence and luck, you can multiply 10x annually. Compound that for 2 years and a $1k “throwaway investment” easily becomes $100K.
FOMO game (zero plans whatsoever):
- This is the new investor who just buys everything people mention without any idea of what’s good or not.
- Also totally me. 🙂
- Also likely to be you if you’re not a professional trader.
Fine…buy stuff randomly, but try to sell intelligently. Some stuff you hang on to for a while. Others you let go. I will say this…try to take profits when things are especially volatile. Whatever goes up quickly can also come down quickly. (Especially with meme coins or other rabid speculation that isn’t built off of real value.)
TIP #7 – when to buy & sell
Buy LOW and sell HIGH.
This old saying is so true and yet so stupidly rhetorical and cliché that it annoys me. If I could rewrite it…it would be “average out to low buys, load up during plunges, and sell before the next crash”.
Averaging out to lower buys basically means to not buy all at once. Establish a foothold in the market with only some of your cash. Then buy more as prices drop. Reserving cash guarantees you’ll always have money to buy down your losses. Hahaha.
Load up during plunges means to buy a ton of stock when you see its price fall so sharply. A downspike could last a day, a week, or even a whole month. It’s like that Black Friday shoe sale. Buy’em all as their value is surely to recover soon after.
Sell before the next crash is obvious. It’s scary as you may hold on for too long thinking the stop might jump higher when in actuality, it’s overdue for a drop. Easier said than done and only experience and intuition can tell you when to sell.
Nobody knows when it’s the right time to buy and sell.
All the so-called experts can’t predict the market. They simply don’t know. At best, reading the past will only teach you about what can happen but it won’t tell you what will happen. Businesses change, speculations changes, things change. Nobody knows what to expect.
You don’t really know when a stock is at its LOW or HIGH until after it’s already happened. So how have I been making my decisions?
- Traditional stocks make more sense. They are pretty stable in how high they rocket or how low they dip.
- Crypto is almost batshit crazy. You can have record crashes 1 month after record highs.
You should ALWAYS buy.
- I try to buy every stock because it allows me to have a pulse on what’s good or not. And as I said earlier, also lets me know who has their stuff or not.
- The only thing is I don’t buy a lot if the price doesn’t look good (stock already blew or has a dipping pattern lately).
It’s also important to know that many crypto stocks tend to move with each other. When the markets up, it seems all of them are up. And likewise when they’re down, all are down. So you shouldn’t freak out if the stock you have is falling along with the market. That means it (should) rebound back together with the market. This is very different from traditional stock markets where many industries and companies can move independently of each other.
Typical SELL STRATEGIES.
The general saying is to “always take profit”. Usually after a massive upsurge, you should take profit before the market dips again. And then just buy in more if you want.
Most common tactic – 50% selloff:
- After a big rise, sell off 50% of your stock.
- Leave the rest as a moon bag, in case it goes “to the moon”.
- If it dips massively after the selloff, you can always buy back in.
- If this stock seems like a one-and-done deal or you KNOW it will crash, then sell off everything.
I’ve also gone the opportunity cost route sometimes. Instead of sitting around biting my nails wondering if my stock is going to drop or jump any further, I simply compare my current stock expectations with other stock available. If one stock is stagnant for too long…I’ll just sell it off and diverge to another one that is about to blow. (Good tactic if you don’t have cash around to take advantage of potential rockets.)
I’m over-simplifying it, as some stock are much more steady (valuable) than others, but you get the idea. It’s easier to buy and sell when you’re comparing options. Either way don’t FOMO yourself from one loss to another. I don’t do this often, ok?
PREDICTIVE SPECULATION – Investing is also a game of reading what other people are gonna do.
I mean…DUH! That’s what it’s always been. Stock value (especially in the short term game) is definitely more dependent on speculation than actual value. You have to get a sense of what people are going to do, then have cash on hand and make the right trades at the right time. One solid trade alone can retire you.
And of course, you have to understand that other people are doing the same thing. Which is trying to guess what other people will do. So then you have to take guesses when markets might change intervals, jump or fall.
Yeah, it’s a lot of volatility. And you do stand to lose a lot of money. I’ve “lost” $10k in one day before. But if you’ve put money into different stocks (hopefully in industries you know) and watched them for some time without emotion, you’ll develop a good sense. If not for how to invest, then at least for how to know who to listen to. 😉
Don’t be emotional (impulsive).
Don’t do that stupid FOMO thing, where you jump into the game because of supposed wannabe internet superstars bragging how much money they made. Most people are lying or full-of-sh*t. People bragging about stock market success are no different from the assholes selling you financial freedom, pyramid schemes, or other make-money-fast bullcrap.
Being emotional about your money will always lead to stupid decisions. Fear of missing out makes you buy expensive, and fear of losing money makes you sell low.
There will always be more opportunities today, tomorrow, or even a month away. You never “missed out” on anything. For every BitCoin and Tesla explosion, there are many less popular stocks that are just as lucrative!
So calm yourself down. And just buy during the right part of the cycle. There are always dips where you can buy in. And also jumps where you can sell off stock you don’t want to hold any longer. If you missed the cycle, just hold your money for the next opportunity. There are always so many around the corner! Do not be FOMO’ed into making bad buys or bad sells! No panic selling. Just hold it!
Learn to embrace volatility. Volatility is your friend.
- “If you don’t get a heart attack a day, it ain’t crypto!”
I used to hate and be so afraid of stocks because the markets were so unpredicting. Rocketing high one day, crashed super low the next. And you hear frustration and sadness everywhere.
But then if you realize it. This volatility means you can make so much more money. You’ll have many more periods when stocks/cryptos are massively undervalued. Giving you more opportunities to buy in and take advantage of dips. Because otherwise….a super stable market gives you zero opportunity. Once you’ve missed the low, you missed it forever.
Sell when you’re up. And be patient. Buy-ins are just around the corner.
TIP #8 – why should you invest?
Because many of us do things for money.
We work for money. Build websites for money. Manage servers. And on and on. And sometimes doing things for money prevents us from enjoying our job. Because we’re forced to take on projects and clients we don’t enjoy that much.
But what happens when you’re all set financially? New doors open…
- You get to be super picky with which clients and projects you take on.
- You get to tell the truth on your blog. 😉
- You get to retire early. Live every day of your life like it’s Saturday.
- Buy or rent a nicer place. Or travel and live all over the world.
- Build and fund new businesses anytime you want. Literally putting every idea/dream to fruition.
- Give it away to family, friends, and other people in need.
Because holding money in USD or any other fiat is probably worthless. Leave that $100k sitting in your bank and what’s it gonna be worth 10 years from now? So much less!
Inflation keeps getting worse and worse until the market crashes. So why not hold your resources in an appreciating asset? Real estate, stocks, gold, basically anything other than the US dollar. And if you’re in one of those countries with super unstable economy (say Argentina), you definitely should be holding your assets in another currency.
Crypto is indeed volatile as heck but it’s still going up relatively and lots of room to create new millionaires overnight.
Meeting a whole new circle of people.
I don’t like talking too much about investing or crypto or making money, but I do like talking to the people who know much about it. Many of them are successful, happy, living the good life. Eating fancy everyday, talking big dreams, goals, fun ideas. And being around that positive energy is infectious.
Ironically though, only half of them made their money in stocks. The other half were already financially successful from something else. Regardless, you’ll be in good company either way. Money doesn’t buy happiness. But not having to worry about money makes lots of room for happiness.
TIP #9 – reducing tax liability
Hahaha, the moment you start making real money, first thing that happens is “FAWKKKKK….I don’t wanna pay taxes on any of this.” I think the government takes way too much. And also that people don’t know how many resources there are for minimizing their tax liability. (Besides, the system is literally built to help reduce tax liability for rich people.)
- Get an IRA account and max it out. These are tax-sheltered accounts.
- Compare the math between longterm vs short-term stocks. Stocks held for at least one year are taxed 10% on gains. Those held for shorter are taxed at 20-25%.
My friends are giving me a ton more specifics on this as the months go by. I’ll update this guide later sometime when I’m not being lazy.
In the meanwhile, you can check out the Nomad Capitalist (Youtube). He’s definitely the voice of a silent minority of people living across the world off-the-radar under different citizenships. You can easily get another passport by buying property in other countries. Buy a $30k house somewhere and you’ll get a passport within a couple months. Then errrr yeahhhh…skirt your way around tax loopholes all you want. Play the game!
TIP #10 – literally getting started
The easiest way is to find one friend who invests.
We’ve all got one or even many. Ask them how long they’ve been doing it and what exchanges they use. It might be good to find one newbie friend and one pro friend so you can see/hear all the different things they do differently.
Then pay for their lunch or something and have them sit down with you. Show you what to sign up for, what to click. You should probably have your bank info, identification card and passport nearby. If you don’t have a friend, fine you can still follow my guide but it’s nice if you have a friend.
- Get $1k or more.
- Sign up for all the exchanges I mentioned.
- Put 60-75% of your money in 2-3 medium risk stocks.
- Put the other 10-15% in risky stocks.
- Save the rest to buy even more in the coming months as you see dips and crashes or take advantage of new opportunities.
- Start following more and more stocks. Star/favorite them in your exchanges. Make notes of what you hear people talk about.
- Don’t worry so much what the experts say, talk to real people in real life and see what they put their money on. See who they follow.
- Figure out what to do about your tax liabilities when you hit big.
What stocks should you start buying? Ha…oh boy, I don’t want to be responsible for you. There are plenty of groups out there for you to follow. The problem is by the time people recommend it, you might be late for the explosion. And what I’m holding today is not necessarily what I recommend buying today. By the time you read this guide, my positions have already changed.
Where to begin reading? I don’t even bother. I just trust my friends who know more than I do. There’s too much information and I don’t recommend you reading either. You learn so much more info from doing real world trading, farming, staking. Start talking and trying things.
- The best education for beginners IMO is from the exchanges. They all have helpful blogs and super easy tutorials. There you can easily learn about margin trading, futures, limits, etc. Keep in mind different exchanges may also have different lingo for things.
- Don’t worry about “knowing everything. You can start trading right away and learn as you go. It’s really the best way.
- I might rewrite this guide as I learn more accurate ways to explain things. But please keep in mind I’m still a noob and also that my explanations here are not as detailed as I know them.
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