Stress of investing in the stock market..
Discussion
Watched my margin disappear this morning, from the outside you would say i was over leveraged, but i honestly thought my ratio of what was in the market and what was covering the position was adequate.. either way said goodbye this morning to around 20k, having to start all over again after years of building a substantial portfolio. Got drawn into the bright lights of the AIM, expensive lesson learnt.
edited because along with having a bad run on the market i cant spell.
edited because along with having a bad run on the market i cant spell.
DomBertone said:
Watched my margin disappear this morning, from the outside you would say i was over leveraged, but i honestly thought my ratio of what was in the market and what was covering the position was adequate.. either way said goodbye this morning to around 20k, having to start all over again after years of building a substantial portfolio. Got drawn into the bright lights of the AIM, expensive lesson learnt.
edited because along with having a bad run on the market i cant spell.
Goddamn....really sorry to hear that....edited because along with having a bad run on the market i cant spell.
I resorted to shorting yesterday. But today i have decided to hold very long on some of the stocks out there. I cant stomach selling them for what i think they are worth in terms of their balance sheet, assets etc...
Not good is it..
The key is not to look at the value of the portfolio, or position of trades - unless you are a day trader.
If they are long term trades, buy and just file the annual divi statements etc.
Quite a bit of study done on this - on the comparison of pleasure from gains vs pain of losses.
The answer is not to watch the screen all the time.
Buy for a 5,10, 15 year horizon in good companies in markets with a future and sit on them - a bit like Warren Buffet.
If they are long term trades, buy and just file the annual divi statements etc.
Quite a bit of study done on this - on the comparison of pleasure from gains vs pain of losses.
The answer is not to watch the screen all the time.
Buy for a 5,10, 15 year horizon in good companies in markets with a future and sit on them - a bit like Warren Buffet.
You need to to take a "different" view or you'll end up popping tablets
If, last week you were the 10,555,555th richest person in the country, then today you probably still are. Despite your losses.
Your buying power remains intact.
Think of the bull in a field, you only need to outrun your friend.
If, last week you were the 10,555,555th richest person in the country, then today you probably still are. Despite your losses.
Your buying power remains intact.
Think of the bull in a field, you only need to outrun your friend.
[quote=pimping]
Currently not stressed as the markets will bounce back.
quote]
Really? You know that, right?
Day trading for yourself has to be the most stressful thing I have ever done, and a mate says the same thing. You cannot leave the screen alone for 2 minutes. When you lose, you shout at the kids, and when you win it's never enough!!!
Especially given these volatile times...it's absolute madness out there!
Currently not stressed as the markets will bounce back.
quote]
Really? You know that, right?
Day trading for yourself has to be the most stressful thing I have ever done, and a mate says the same thing. You cannot leave the screen alone for 2 minutes. When you lose, you shout at the kids, and when you win it's never enough!!!
Especially given these volatile times...it's absolute madness out there!
I have cashed almost everything in this week. I am buying a house at the end of next month and would rather know exactly what I have now and that I can make the purchase with a loss than wait until I have to sell next month and then find I fall short on the purchase price.
I have kept a bit in China for the long term but that was more because I didn't know how to value it or get at it than anything clever. I had also had a letter about the volatility from the fund manager advising me to hold my nerve so assumed it had taken a major hit and was probably only worth 3p anyway. I think I lost about £15K from the value which wiped out all of my gains but left me with what I had put in over the past 3 or 4 years (subject to the settlement statement arriving!).
I have kept a bit in China for the long term but that was more because I didn't know how to value it or get at it than anything clever. I had also had a letter about the volatility from the fund manager advising me to hold my nerve so assumed it had taken a major hit and was probably only worth 3p anyway. I think I lost about £15K from the value which wiped out all of my gains but left me with what I had put in over the past 3 or 4 years (subject to the settlement statement arriving!).
Cogcog said:
I have cashed almost everything in this week. I am buying a house at the end of next month and would rather know exactly what I have now and that I can make the purchase with a loss than wait until I have to sell next month and then find I fall short on the purchase price.
I have kept a bit in China for the long term but that was more because I didn't know how to value it or get at it than anything clever. I had also had a letter about the volatility from the fund manager advising me to hold my nerve so assumed it had taken a major hit and was probably only worth 3p anyway. I think I lost about £15K from the value which wiped out all of my gains but left me with what I had put in over the past 3 or 4 years (subject to the settlement statement arriving!).
In your situation selling up was probably the right thing to do. For the rest of us it's almost certainly better to hold on.I have kept a bit in China for the long term but that was more because I didn't know how to value it or get at it than anything clever. I had also had a letter about the volatility from the fund manager advising me to hold my nerve so assumed it had taken a major hit and was probably only worth 3p anyway. I think I lost about £15K from the value which wiped out all of my gains but left me with what I had put in over the past 3 or 4 years (subject to the settlement statement arriving!).
It depends on how you are investing of course. I have traded CFD's as well as indvidual physical stocks for a long time but always with a backgroun of maxed out pension contributions and fund holdings as part of my portfolio. I am currently not actively trading, but manage my funds (ISA, non-ISA and SIPP) actively. I rotatetd about 35percent of my holdings into cash and bonds on 5th August and as a result my holdings are down about 8 percent rather than being a lot worse. As the FTSE passed below 5k I rotated back some of the positions but still cautious. Fund holdings are of course longer term holdings anyway but I will avoid the major downsides when possible to help maximise longterm return. It takes a bit of work to keep on top of it but that's fine by me. Fwiw my funds have returned over 12 percent each year for 4 years until this year - so I can't complain. I am sure others have had even better growth during that period. The trick is to act on what you see rather than hope - in certain scenarios I would and have hedged my expsoure in the short term with CFD's and options etc.
Day trading at the moment though would be pretty hairy imho!
Day trading at the moment though would be pretty hairy imho!
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