What I learn from the stock exchange

Investing money could be risky, especially if you do it in the stock exchange. Add more risk if you trade options. Add more risk if you read news. I didn’t figure how the emotions can change anything until I get into the stock exchange last year, and also I didn’t figure how much pressure I can take.

I love economics and so investing. I followed stock exchange for two years without making any investment, only watching, reading and looking. Last July I started a small trade account with Thinkorswim. I were exited, motivated, with a happy feeling in my heart and my mind thinking about changing life. I started with tiny trades, like putting my feet on the water to see what’s really happening on this “game” (oops, I used the prohibited word by traders). A couple of weeks and I were doing spreads (two or more options trades over the same company or instrument), using very weird terms like greeks, beta and EPS to make decisions. Two more weeks and the happy feeling I had started to mutate into stress and pressure.

I did the same thing all the newbies do: pay attention to news. I started to loss money, and getting more pressure. Every day I spent one or more hours of my day to check trades, look companies, read comments, recommendations and picks. Time went on and I continue to loss money, and I didn’t figure why! When I discover my mistake, was too late.

Why you think people recommend trades? The logic answer is the only possible, don’t lie to you: to make money from the people who reads the recommendations. That’s why they changes you a fee or have ad’s on every article. No one wants to help you, really. Maybe there is a couple who thinks are making the difference, but sincerely, all this kind of people are the indirect employees of the trade market. From them I learn if I want to succeed into something, I need to make my own decisions.

Pressure is something I learn to handle a long time ago, but I never experimented the kind of pressure you have when you put your (and your wife) money into a trade when you have a heavy loss record. You feel the adrenaline flowing into your body. You feel exited and trend to think anything else doesn’t matters. I don’t know really because I didn’t try it, but I suppose is something like addicts says about heroin.

But your brain and your body start to handle it. And everything else which make your suffer stress time ago, now seems like a kids game. In time you improve your work, you look for news challenges and feels better doing the same thinks you consider too risky before. It’s like an extreme sport! And you learn how to handle the stress risk makes you fell, without starting to cry. What I learn from pressure is how to feel more comfortable handling difficult situations.

Now I started again. I have my papermoney account, one with fake money. I put on this one the same amount I put on the real one last year and I start to make my trade decisions based on what I know, what I suppose and what I don’t know. I planning to have this one open for one year and see the results. After that, if I build confidence in myself trading, I’ll fund my account again and start making money.

From 15 February to date I made a 24% returns. But I know this number isn’t something sustainable. I expect to loss money, I expect to make less than 10% every month. This time I don’t care about the bragging traders you can meet on chat rooms telling you they made 30% every moth. This is a lie, I swear. Life it’s easy, but making big money not. Now, I learn how to start to learn to trade.

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