Survey Of Retail Investors Shows The Blind Lead The Blind

But the average investor’s pain threshold is a lot lower than that. The research shows that it doesn’t matter if the bear market lasts less than 3-months (like the 1990 bear) or less than 3-days (like the 1987 bear). People will still sell out, usually at the very bottom and almost always at a loss.

If You Trade, Have Some Guidelines

Throughout history, individuals repeatedly jump into the more speculative stages of the financial market under the assumption that “this time is different.”

Of course, as we now know, with the benefit of hindsight, 1929, 1972, 1999, 2007, and 2020 were not different – they were just the peak of speculative investing frenzies. 

While many young investors are simply following other young investors, who lack the experience, skill, and knowledge to be successful over the long term, a select group of investors is revered for their success. While we idolize these investors for their respective “geniuses,” we can also save ourselves time and money by learning from their wisdom and their experiences.

That wisdom was NOT inherited but birthed out of years of mistakes, miscalculations, and trial-and-error. Most importantly, what separates these individuals from all others was their ability to learn from those mistakes, adapt, and capitalize on that knowledge in the future.

Experience is an expensive commodity to acquire, which is why it is always cheaper to learn from the mistakes of others.

I have compiled a collection of rules, axioms, and wisdom to protect you from repeating mistakes that eventually destroy your wealth.

There is an old WallStreet axiom which states:

“A man with money meets a man with experience. The man with the experience leaves with the money, while the man with money leaves with experience.”

Such is the truth about markets and investing.

Experience tends to be a brutal teacher, but it is only through experience that we learn how to build wealth successfully over the long term. Many young investors will eventually gain a lot of experience by giving most of their money away to those with experience.

It is one of the oldest stories on Wall Street.

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