I'm a shitty Trader.
I came into the Bitcoin space relatively early (circa late 2014) and put what I could afford in. For two years I prophesied the shit out of it and got laughed at, and embarrassed by my risk averse peers. It was starting to look like I was wrong. I hodled anyways. Come 2016 things started to heat up. I was able to convince some of my close buddies to hop on the train with me while $BTC was still hovering under 1K. Then, 2017 rolls around and the genie gets let out of the bottle. Bitcoin and ETH have their ensuing rallies and that’s when shit started to get interesting. I’m getting phone calls from people coming out of the woodwork. Everyone’s asking me yo, “should I buy now”. Friends of friends sending me frantic texts while bitcoin moves up wildly. Around mid summer 2017 Bitcoin is somewhere in the ballpark of 3K. The “should I invest” now questions are still coming in daily. At this time I’m 20 Y/O, have no finance background, and absolutely zero technical analysis knowledge. But, I’m still getting constantly solicited by people who barely know me on what the best entry in BTC. My answer was generally “wait for a pullback” Well, as we all know in 2017 their were a few minor “pullbacks” but nothing sustained and Bitcoin was more or less constantly moving in a parabolic upwards motion. All in all I finally convinced about 20+ of my friends to get involved in the market. By the end of 2017 we had cumulatively brought in hundreds of thousands of dollars in paper returns with very small initial investments. I felt like a fucking genius. I couldn’t miss a trade. Who could when everything was going up? January 2018 rolls around and I’m in my second semester of my senior year in college. I couldn’t focus on anything school related. My blockfolio account was booming on a near daily basis. It felt like Bitcoin was making new highs every time I checked. Did I take profit at the top? Of course not. At this point I was certain I was going to be a millionaire and that 2018 would bring in even more profound returns. Then, shit started to hit the fan. In about 1 month I lost 70% of my portfolio value and was back at the same pre-massive run levels. Did I take profits at the top? No, of course not. I had no clue what I was doing. Instead I put almost my entire account into $EOS and watched it triple in 3 weeks. Back to January levels by april. I’m a genius I thought. Then, Another 60% drawdown. Fuck it, house my account into $BNB, it worked last time with $EOS right? $BNB more than doubles in a matter of a month and I’m back to January levels. Genius Right? I’m on a massive winning streak. Invincibility. Everyone on twitter is whining about losing all their money and wishing they sold the top while I’m still sitting up at near ATH account value. Genuis, right? I can’t lose. My next “big trade” was $ETC. Fundamentally, I didn’t know shit about it I just had the taste for big returns on my mind and was ready to regain my summer losses. My position size was enormous relative to my portfolio. This one didn’t hit. No stop loss, no sell target, no nothing. It was textbook poor trading style. Needless to say, I got rekt. The drawdown was intense but eventually I bit the bullet and exited, losing about 30% of my entire portfolio in one fell swoop. Fast forward to today, I’m at pre- December 2017 levels. Very little realized profits along the way. This whole shit storm was a painful in monetary terms, although the lessons I’ve learned along the way will surely stick with me for a lifetime. My biggest mistakes I made: having absolutely no concept of risk management, position sizing or anything of the like, having too strong of a fundamental conviction in Bitcoin to take profits at the “top”, and not seeing through the bullshit dumpster fire of ICO’s and garbage time money grabs. But how can I blame myself? Besides investing in a few public companies prior to BTC, crypto was my first experience in any financial markets. And It was, in monetary terms. A wild success. The worst thing that can happen to a new investor is having immediate success because, plainly: past performance does not indicate future results. What I really learned is simple. I’m an investor and not a trader. I was conflating those two things and i’m not even sure If I could have told you the difference. My success investing in some early stage crypto companies made me think that I could “trade” to drive income rather than just relying on long term gains. 2018 had different plans for me. Aside from understanding my place in crypto, the most valuable thing I did this year was take a deep dive into monetary history. I’m talking the entire history of money from trading sea shells to gold receipts to whatever fuck fest were having right now at the fed. This is the sort of knowledge you will only get if you go out and seek it for yourself. It’s not a pretty story and you certainly won’t learn the truth in high school or college. Even if Bitcoin goes to $0, and this whole thing turns out to be a massive sham, I still am left with some real life tangible knowledge on market psychology, how to properly manage risk in a volatile market, and what money really is. Without Bitcoin, I would have none of that.
- Lou Pai
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source https://www.reddit.com/r/btc/comments/a3fkym/my_bitcoin_investing_story/
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