Today I’ll be telling you the start to my investment journey and what mistakes I’ve made so you can avoid them. The Beginning of My Journey When I left my position at Morgan Stanley to work for E*Trade, I had about $5,000 in a 401k that I chose to roll over into an IRA. I […]
Today I’ll be telling you the start to my investment journey and what mistakes I’ve made so you can avoid them.
The Beginning of My Journey
When I left my position at Morgan Stanley to work for E*Trade, I had about $5,000 in a 401k that I chose to roll over into an IRA. I bought into 5 companies I truly believed in and so my journey began!
The First Mistake
After a few months, I experienced my first market dip. I was terrified I would lose everything, so I freaked out and sold them all. I had a plan though! I sold only to buy back when they dipped lower. I listened to the news and was surrounded by the media, and as it goes I fell victim to all the fear tactics used.
I was hearing that Amazon was about to report earnings and they were expected to do very well, so I bought in and hoped to recover my losses. I watched my money all day, I couldn’t even focus on anything else.
The First Mistake, Again
At the end of the day when the market had closed and the report had come out, the stock had dropped around 15%. Again, I freaked out. The thing I couldn’t seem to remember was that this money was for retirement! I wouldn’t need it for the next 30 years or so! I let my emotions overtake me, and the next morning I heard what sent me panicking again. A news reporter said, “Owning Amazon stock right now is like catching a falling knife.” And cue the immediate sale of my stock in Amazon.
Taking My Own Advice, Finally!
I researched and looked into a lot of different options before deciding once again to put all of my money into Facebook. It isn’t going anywhere and I use it every day, so I bought in and was finally able to take my own advice and leave it alone! The market had started to come back so it was easier not to panic this time.
When buying into stock, it’s important to remember that buying in when the price is down is a very hard cycle to get out of. It’s also important to not pay too much attention to your money! Chances are, you may freak out and sell before it’s worth it. I did it so you don’t have to.