My experience in stock trading: nice profits, but risking is dangerous.

Facebook, Netflix, Google stocks. I want to share my mistakes and my feelings about it

Last month I heard that Google’s, Netflix’s and Facebook’ stocks are on fire, according to optionmag, and I decided to try to invest on them. Google and Netflix are actually surging this year. The stocks, up to respective 32 percent and 53 percent in 2018, both just hit all-time highs.

“While both stocks are solid growth names, Netflix looks more attractive than Google” said Mark Tepper. He is the president and CEO of Strategic Wealth Partners. I heard his speech and I immediately invested on these stocks. And I managed to get a good deal.

Do you know what the paradoxical thing is? That that one was my first experience in stock trading. The enthusiasm and the satisfaction were the main feelings: the enthusiasm of having discovered a new way to earn extra money, using money to produce money. It was very stimulating and exciting. I felt incredibly satisfied for taking advantage of this opportunity.
But the enthusiasm pushed me to throw myself into this new adventure without knowing the criteria that would allow me to do it successfully.

Netflix Stock

Correlation of stock with subscribers

Let me be honest: I knew only broadly what investing in stocks meant. It was not my ground.
But the desire to try investing with my hands was so great that I could not help myself. I got scarcely informed on the platforms that allow you to buy – comfortably in front of a PC – and to sell shares, and to access directly and without filters to the stock market, and I started investing.

I bought the shares of companies on which I thought it was worth investing my money, hoping to be lucky and to have had a great intuition.
I didn’t think much about the question “On what criteria could I base myself in order to choose the company to which to entrust my savings?” and that’s where the error was.
At the beginning I was proceeding without any criteria, my decision was simply the result of a feeling: “This company inspires me because I heard good news about it!”. And I would proceed with buying only a few hundred euros of shares of this company. Yes, you understood correctly: a few hundred euros!

Fortunately a feeling came to life in me shortly after that: Fear!

I was afraid of making the wrong decisions and of losing my capital in a few days. I stopped trading, I got informed and then I started again in a more cautious way.
Thank goodness fear intervenes every time we come across something we do not know, something new. Luckily we have this mental spy that curbs the emotional drive.
If I had listened only to my enthusiasm, in fact, I would have invested all my possessions and lost them.

In the title of this post there is the phrase “risking is dangerous” and this is exactly what I want to talk about. My advice is only this: do not be afraid of fear. Always try to maintain a balance between mental (rational) and emotional (creative-exciting) energy. Obviously, technical knowledge must be present too: it should always come before any experience. You do not need to just acquire knowledge, but also to experiment it safely using demo accounts or by talking with experienced traders.

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