My Investing Mistakes

The late 2000’s were a rough time. The United States economy was in the biggest decline since the great depression and a young Gabe was testing the waters of investing after a conversation at the gym with a friend. If you’ve read my blog before, you know I’m a huge fan of investing, but that doesn’t mean I didn’t have a ton of horrible rookie mistakes. Let’s look into my worst investing mistakes.


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I am not a financial advisor and do not offer financial advice. This article is for informative purposes only. If you are seeking advice, look for a professional in your area.


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Investing Mistakes 1: Sold Apple at $18.5

(Price is adjusted after stock split). My first investment was Apple. I was so excited because the iPhone had just been released, I didn’t see how I could lose! I placed the trade at around 10 pm (After Hours, The market is closed and your trade doesn’t go in until the next morning). Little did I know that they had just released their quarterly earnings report, and the stock pulled back so my $10,000 investment lost about $300. I left it there for about a week and since things didn’t get better, I sold.

Lesson: The stock market will have its up and downs! If you believe in the company stick with it. The market is meant to fluctuate, don’t let small changes scare you. I did jump back into Apple at around $50 and sold at about $100. Yes, I would have gained another 50% if I would have held it, but I’ve learned not to be greedy. If I have a good enough return, I’ll sell and take my earnings.

Investing Mistakes 2: Hunches

Once my family found out I was investing, there was a slight rise in interest of the investment world. My brother decided it would be a good idea to invest in Concurrent Technologies. Not familiar with it? Neither am I. But it was priced like at $0.60 (again, pre-reverse split) so obviously, it had to go up right? We all ended up putting in a couple of thousands since I didn’t want to be the one to lose out if it went up. Well, we lost about half of the money we invested. We were down about $3000 between the three of us. I didn’t sell right away, I actually ended up doubling down when the price was down, and as it rose, I sold and only lost a few hundred dollars.

Lesson: Stop trying to get rich quick. The stock market is meant to be for long-term investors. There is a way higher chance that you’ll end up losing money by investing in penny stocks. If you can’t picture the company being here in 10 years, you shouldn’t be investing in it.

Investing Mistakes 3: Too Big To Fail

Financials were in a bad spot in those years. But a good investor buys when on others are scared right? Washington Mutual was the biggest deposit bank in the United States, and as they were my personal bank, I figured there was no way the company would go under. There were rumors of course, but every bank was in trouble. I go in with about $1000 and made about $700 in a day or two. I sold to keep those $700 on a Friday. Monday morning they had declared bankruptcy. The government seized the bank and sold it to JPMorgan Chase. My shares were worthless.

Lesson: Where there’s smoke there’s fire. I don’t solely invest on financials, but you do have to somewhat accounts for the finances in the company, In those days, Washington Mutual gave everything away for free. Bring in $1 and you can open an account with free checks, free savings, free debit card, etc. That was great for the customer, but the bank pays to maintain all those accounts and they were bleeding money left and right. Mix that in with bad mortgages, and it became a sinking ship.

Learning Experiences

These are just some of the mistakes I made in those years, but I don’t regret any of them. The investing mistakes I made would end up teaching me more than any class could. Ultimately there are a few major lessons you can learn from me to avoid an investment mess:

  • It’s not a get rich quick scheme. Before investing, look up what your bank account pays you in your savings account. If it’s 1%, and you earn 2% in the stock market, consider it a success.
  • Don’t Be Greedy. The goal is to make money, but a good part of being profitable is learning when to walk away with your winnings.
  • Don’t Gamble. The Casino is way more fun and you might get a few free drinks from it. The market is to earn a return from a company you wouldn’t mind being the owner of.

Learn more about the basics to investing here.

What investment mistakes did you learn from when starting out?

 

About Gabe A

Gabe A. is the creator of The Shiny Dollar. Besides writing and helping others with their finances, he loves to travel and spend time with his family.

View all posts by Gabe A →

12 Comments on “My Investing Mistakes”

    1. It’s definitely one of may biggest take aways. Which is probably another reason why I’ve never invested in cryptocurrency…I have no idea what’ll happen to it in the future.

      Thanks for your comments GYM!

  1. These are great tips from pretty sad situations – but, I always say if you consider the information you learned at value – did you really lose? Great post! Looking forward to more!

    1. Hi Allie!

      I definitely agree! What’s more is that these mistakes happened mostly early on when I had less money, so as my money grew I was able to apply what I learned! I easily made back what I lost and a lot more after that!

      Thank you for reading and commenting!

  2. Hey Gabe – you make some good points.

    Related to investing, I *almost* purchased stock in my company back when I was actively purchasing individual stocks. When the oil volatility occurred in 2015-2016, the stock dove about 45%. It’s a good thing I decided against it, because the stock still hasn’t recovered. Then again the oil/gas industry is nowhere near the highs prior to 2015. If I was still at the company, I may have purchased when it was at its lowest.

    1. Hey HP!

      You know that reminds me of investing in BP after the oil spill (trying to capitalize on the downturn). After the stock not moving for a while I got out of it though. I definitely think Electric is the future now though so unless these oil companies get into electric recharging stations, I’m staying away from oil!

  3. Wow, I could learn from your mistakes!

    The first time I had stocks was with a company (my first job basically) that got bought out by a bigger company. The new owner was nice enough to give out stocks to each employee. I don’t remember how many stocks I had but it was something that I didn’t want to keep because I had a feeling the company wasn’t going to last long.

    I sold all my shares and I ended up making over a grand which was sweet for a college student lol. I kept it as savings. Not fast forward almost 10 years later, the stock isn’t worth much and the company got bought out yet again. Yikes.

    Thanks for sharing your experiences!
    Melanie, Mommy Finance recently posted…How to Choose the Right Credit Card that Fits Your LifestyleMy Profile

    1. When I worked for a retail store during the recession, I saw our sales go down drastically. So I decided to invest when the sales started rebounding and it worked out! I made some money on that transaction. Sometimes being close to the situation can help out a lot with the decision!

  4. It is really interesting to get a perspective from during the crisis years on individual stocks. I had just graduated high school in 2008 and thought that the red on CNBC was just the norm. Would have been nice to hold on to Apple but you live and you learn. Do you still invest in individual companies?

    1. Hey DM,

      I was actually reading a few months back on how Dominos Pizza had outperformed Apple since like 2010… You never know what the next company will be…

      Yeah I definitely still invest in individual stocks, just not as much as I used to. I’d say about 15% of my portfolio are individual stocks… I’ll also say those individual stocks rose close to 100% this year alone. BUT one of my mistakes before was being too greedy! So I’ll take what I earned this year and be completely happy with it, right?

      Thanks for reading!

        1. Honestly just my mentality. I stopped worrying about cutting one too early. I started looking at the percentages so even if I sell a company and make a 10% gain, and it goes off to make a 100% gain, I try to be happy knowing that in my savings it would have gotten me like 0.2%.

          I feel like timing the market is impossible, so I give myself goals in the beginning of the year and try to meet them. I normally try to earn around 8% in my investments a year, but if I believe the company will keep rising, I stick with it for a bit.

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