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dmgkgkgh12

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Just wanted to get this question out there - I would like to apologise in advance if I may sound like I am whinging (i.e. my previous "infant to trading" thread).

It seems that everyone who has dipped their feet in trading comes from different backgrounds and thus varying driving forces.

For all of you that have been trading for any amount of time - if you were to go back and start from scratch, what would you do to claw back to where you are now? Let's assume you had ~$5k capital to do the damage.
 

This pandemic hit me at the absolute worst possible time and has resulted in me being in exactly that position. I don't even have $5k to my name, I don't own a bed, I don't even have a full wardrobe of clothes, I lost everything from my toothpaste and washing powder to my computer, books... everything.

In 2008 I was wiped out to having less than a grand to my name (not by the GFC, from something entirely different) and within 2-3 years I had a portfolio of around $500,000 and some assets (I had never traded before and started in 2008 right at the perfect time, which certainly helped). Previous to that I'd had a pretty colourful life with highs and lows. Since then I've become accustomed to eating like a king and having a really good life, but I've had the previous experience so am well able to rough it while it's a necessity.

I may trade some stocks whenever it looks obvious that the recovery is starting, but right now it seems likely to be a dead cat bounce/bear trap, and I can't afford to lose anything so will probably be avoiding the market for a while. I'll do whatever I can to scratch some money together, start a business (currently extremely difficult given the situation) and drag myself up. If travel restrictions are lifted much sooner than expected (very unlikely) I'll go back to Asia and see if I can salvage the business there.

Looking specifically at the market, I think it's extremely unpredictable at the moment and will be for some time. This is arguably the most extreme black swan event in living memory, with governments making unpredictable moves which in many cases are irrational and will have extreme impacts. You could potentially make a pile of money very quickly, but just as easily lose it, and you'd be kidding yourself if you thought anything was a sure thing right now. The only time we could be certain was that the market overall would drop about a month ago (it was pretty obvious before that). If I had a computer and safe place to live and stable life and reliable internet access, I'd have been shorting.
 

1, I would get the best paying job I could.

2, spend less than I earn, and save the difference.

3, invest these savings in a range of investments I consider to be undervalued.

————-
Trying to get rich by trading a $5000 initial capital base is not likely to be successful, you need to steadily increase your capital base.

when you have very little capital, the fastest way to increase your capital is through savings.

spending less than you earn is the only tried and tested method most people will have to build a capital base.

You can increase your savings by either earning more, spending less or both.
 
Give one of the members who have that warm generous want to save the World outlooks a PM.
Try Basillio.
I would help but I live at the end if the World, Perth.
 
sptrawler said:
Give one of the members who have that warm generous want to save the World outlooks a PM.
Try Basillio.
I would help but I live at the end if the World, Perth.
Click to expand...

Haha, I'm certainly not here asking for a handout If anyone can hook me up with a job I'm overqualified for I'll be very grateful (happy to relocate to anywhere I can get to), but I'm as unlikely to ask for charity as I imagine anyone here would be to actually provide it! In any case, let's not derail the thread. Thank you for the thought.
 

1. I think that would be a fair assumption. That in of itself is an important point. Different backgrounds provide different areas of expertise/interests/etc. That can and likely will have an impact on how you start trading/investing. Your personal psychology is the next issue: different psychology's require different styles of trading/investing. So your first questions are, or should be, self-directed and honest. What can you bring to the table? Does it provide a theoretical edge anywhere in the markets? If so, how can you develop and capitalise on that edge?

2. This question could be re-stated: If I knew then, what I know now, would I do anything differently? For most, certainly myself, the answer would be: definitely. When you don't know, what you don't know, it is hard to correct that lacuna.

Already displayed on this thread are a number of very important traits that are prerequisites for long term success in the markets:

(a) Mr Sdajii: the ability to absorb losses and not fold. You will lose money. You will win money. In the losing, some people simply fold: the pain/stress/etc is just too high to compensate for the wins. In many ways the money is secondary to the 'game'.

(b) You have to love the game.

(c) Mr ValueCollector: patience. This game is designed to test your patience (in any time frame) and push you to your personal psychological limits: for example, drawdowns (in mechanical systems, or any methodology) are patience testing, particularly at the initiation of a new system, or waiting for value to express itself if purchasing undervalued securities.

(d) You have to have a valid plan/strategy to leverage (a) and (c).

With those four traits alone, you could turn your $5000 into millions.

jog on
duc
 
Not sure it is really applicable in @Sdajii case.
When you have connections and knowledge, are matured enough but not too old, have assets stranded OS as in his case as far as i know, what you need is weathering the storm, get a surviving job until situation unlock and you can start your business again.
I would 100% agree with your recommendation to a 20y starting in life, this is what i recommend to my young adult son..but only as i despair at his lack of entrepreneurship...
If you are an entrepreneurial spirit, you build businesses again and again until it works be it a pizzeria, a laundromat or an AR IT startup here or O/S
I do not expect it to be understandable by many but some here like @tech/a will see what i mean.
FWIW best of luck @Sdajii
 
Are you in Australia @Sdajii ?

Do you qualify for any government benefits either as an individual or a business ?
 
I differ from most ...

My career and 37 years latter is about trading investing. Started as the trainee dealer ... assistant then junior dealer ... dealer ... senior ... chief ... head of trading and that was 25 years ago ...

Not much different. I cannot change human nature.
Advice is to read, and not flashy secret system books.
Read some more. And then even more.
Buffett is full of SH ... whilst i am a value investor ... Buffett and his methods do not work for anyone unable to buy the whole company. His greatest assets is NOT paying tax for 50 years.

Over the years, one gets smacked no matter how good your research or risk management is. Diversification and NOT cutting profits .... but SLASHING loss is good advice.Sometimes that option is NOT given or well ... offered. Many times .... in fact ... more often than one may think. One day all is going well, the next the company is in admin out of the blue .... it happens, they do lie ... or 9/11 or say recently OPEC and oil down 25% in a day ... not just down but a crash.

Some battle scars everyone bears. Its WHAT you do when things go wrong. Not looking back and going if only I waited, if your exit is poor. Much of it is about capital preservation and extreme measures at times. Whilst I scratch my head about CV19 and longer term implications USA rallies ? China announced shocking numbers, USA as well .... CV19 numbers worse and the president claims its getting better in the USA ? USA rallies 3% ? Oh really ?

Logic verses reality is an ability ... STOP LOSS .... STOP LOSS and if in doubt get the hell out.

At times, one licks their wounds, but the ability to pick ones self back up is what makes a big difference.

If you dont have an edge, DON'T speculate, dont trade. I suspect most do NOT have an edge over the market. Not some charting BS or method that works for 5 days, one that is based upon solid meat and potatoes management and returns. Yes sure, you will get some wrong. Some you will get right and very right.

I do not know where CV19 will take us. I do know some things are set in stone with massive longer term implications. I am aware USA wishes to ignore it and its motivations are driven with getting people back to work and ignoring those outside the top 1%. Rest of the world, is mainly not there.

IF your really not beating the index year in year out by a fair margin, then, well .... let someone who is manage your money. Some research as to WHO and what they are. About 5% of the top fund managers have records beating the index over 3,5,10 year periods by decent amounts.

Of course, most will scoff at that. Such is life.
Everything is a risk, and when markets do not reflect underlying risk or are ignoring it, its time to reduce exposure. We have right now our market reacting to more underlying fundamentals and likely outcomes with the index down well over 20% off the highs and the USA down a mere 15%. USA likely hit and smashed harder longer term with debt issues and social issues, but human dont matter in the USA.

Strange world.

If you have been crushed by recent moves and my actions of late have not been pretty as one would like, your not alone. Everyone or the vast majority loose money in falling markets. Stocks fall, comparing the value to the peak a mere few months ago, is painful or if reducing risk, painful to lock in what one could have made or whatever.

Be kind to yourself. Yes self examination is needed, and harsh examination if you have the guts. Most do not and most fail as a trader and investor. They fail to change, fail to take action, often look for shortcuts. More often than not use margin which, well for an experienced person is used sparingly if at all. Running a margin position as many do, when it goes wrong, instead of loosing the 10k capital you had or whatever you end up loosing it all.

There is HOPE ... no matter what. It may seem like the end of the world. You may even go bankrupt, your life may appear to dissolve. Your family or trophy wife may abandon you. Likely that's a blessing. IT will pass. Andrew Forrest did not get to be Australia's richest man without total failures along the way. Most people who are successful get bashed up along the way. Forrest and his previous ventures were painful and awful.

Trading or investing should be a GET RICH SLOW ... method. As is every business or accumulation of wealth. There is no magic shortcut. One has to do the work. Sure at times, we get some things very right, but along the way, we get others wrong. Money management is paramount and letting the bloody profits run and cutting the losses is key. Shares and trading often finds the less experienced doing the total opposite of this. Selling low and panic and buying high. When one has good cause to panic or reduce risk, we often find time and time again, the new hero's buying into things that are worthless. On the flip side, when something goes nuts, one reduces, slowly but reduces risk for that rainy day.

Sure, I can hear many thinking and going how stupid and selling a stock that's going to $100- from one cent sounds fine until you have 1% of capital in it and it becomes 99% of your investment portfolio. We are strange people and yes stocks do go from 1 cent even lower to say $10- and back down to hell again.

Be kind .... to yourself. Examine what has occurred. If you still have pain being inflicted, reduce till that pain abates. After examining why ? ... be kind but also be brutally honest. Don't sulk and make a decision to change. Whether that be let someone else do it for you, or whatever.

If it means staring all over again, such is life.
A journey.
 
SirRumpole said:
Are you in Australia @Sdajii ?

Do you qualify for any government benefits either as an individual or a business ?
Click to expand...
In my own case with business activity in China, I can get zero
Indeed my company income was not attracting gst and the help is based on gst income.
Just think at the irony:
Business bringing money from overseas into Australia: be it services or wyaogu beef will not be helped to survive while your cafe will.
Good basis for a restart isn't it
Will try to email my MP so that they are at least aware.income is 0 since bans of China travels, and for forseeable future.
Unless changes ahead, i will fold my company..while the startup in China survives
 

Great advice, right here.

The one alternative is if you are no good at determining undervalued companies, invest with a great fund manager/set of managers, or a passive index fund.
Then use the time you would have spent analysing companies to build a side business/side gig. Something that requires very little capital to start.
Feed all your free cash flow into your investments (or business, if the risk/reward is in your favour) and watch it compound.

Increasing your market value by picking up new skills, thus increasing your salary, is also advisable.
 

Since yours is the closest experience to what the OP is asking, twice, if it's not too painful, can you expound?

How did you go from <$1,000 to having $500,000 portfolio and additional assets?

Unrelated to OP question but can you tell us how you went from having a portfolio of $500,000 at the start of a 10 year bull market to getting wiped out to essentially 0 now?

And if you manage to pull together some capital, you'll start a business? What kind of business? How much starting capital?
 
Personally I'm in the camp with @Value Collector. If I was wiped out for whatever reason (and I essentially try very hard to avoid any risks that can lead to wipeout), it'd be full bore on converting human capital into cashflow and keeping costs down to make sure it's all cashflow positive. I wouldn't get back into the markets until I had:

1. A sufficient amount of cash savings retained to pay living expenses for a year so that any future investments can be made without being subject to vagaries of market volatility (i.e. needing to sell investments at inopportune moments to achieve liquidity requirements)
2. Sufficient additional cash savings on top of that that would actually be worthwhile and feasible investing/trading. $5,000 does not qualify for anything more than a single passive investment into one asset class, IMHO.

If you have $5,000, it's probably just between 1-3 months of living expenses depending on your situation. You certainly can't invest it in any way that would make a meaningful impact on your total net worth, sans luck.
Maybe you think you can trade your way to success, but the most likely outcome is that the psychological load of trying to regain prior net worth levels from a low starting base plus requirement of luck for a perfect run of trades off low starting base will cause emotional mistakes and failure.
 
Adding to those suggestions above.

Ill keep it short for impact.

I would be continually looking at ways of leveraging AND I DON'T MEAN IN THE TRADING SENSE

Leverage your time ---Speakers do this ,educators ,become sought after in a field or fields.
Leverage others ---- Use their time to add to your earnings. When I started Cutting Lawns as a Kid I payed a helper $10/ Hr less than I charged him out at.
Leverage Product ---- But something for X and sell it for Y
Leverage the leveraged products --- Be a small Amazon
Leverage Equipment--- Window cleaners add to their value by owning the right gear. I do it with Excavators and Earth moving equipment. A trailer and you are worth more than just you.

Put it all together---BUSINESS--- could be anything.

Then Leverage the business with other peoples money.

The hard part is finding something with continued demand in these times.
That you can make an impact with.
It will need to be innovative and service a continuing need.
 
I think @Sdajii is not planning anyventrt into market investment at this stage and is aware, his next investment is in restarting his business if he can
 
And i may add:
even if not your money, limit stock and physical goods..which become obsolete perish burn etc and cost if only to store
Amazon enables you to resell goods straight from factory to buyers without storage...obviously an issue as we all saw when **** happens, but less than having a container of goods paid for, you can not sell..

@tech/a post is a gem.
Please take note if a budding entrepreneur
I do not always often agree on either RE or share investment with tech/a as we follow different schools but business wise, this is Gold
 
qldfrog said:
as we follow different schools
Click to expand...

Same subject.
We dont have to agree.
Wouldn't learn anything if we did.

Inv B
V/C
The guy with the Big Kahuna's
and quite a few others have some great snippets.

Hmm That's given me an Idea.
 
This is a disastrous economic situation for many people. No doubt about that and it obviously affects our ASF community.

However there has never been a better time for Australian government support for individuals, businesses and sole traders. As far as I can see see sole traders are well eligible for job keeper subsidies. If you have a partner on the books as well, they too are eligible for a 6 month "stay afloat" payment of $750 a week.

Cheers !

JobKeeper Payment for sole traders and other entities
Last Updated: 16 April 2020

Sole traders and other entities may be eligible to receive the JobKeeper Payment if their turnover has reduced. Following registration by the eligible business, the Government will provide $1,500 per fortnight per eligible employee until 27 September 2020.
On this page
  • Eligibility
  • Timing
  • How to apply
  • What to do if you're receiving the JobSeeker Payment
The JobKeeper Payment is a scheme to support businesses significantly affected by the coronavirus to help keep more Australians in jobs. The JobKeeper Payment is administered by the Australian Taxation Office (ATO).

Sole traders and some other entities (such as partnerships, trusts or companies) may be entitled to the JobKeeper Payment scheme under the business participation entitlement. However, not-for-profit organisations are not included.

A limit applies of one $1,500 JobKeeper payment per fortnight for one eligible business participant. If your entity also has employees, you may also be able to claim additional JobKeeper payments of $1,500 per fortnight per eligible employee.

The entity, not the eligible business participant, receives the JobKeeper payment. The exception is a sole trader, who is both the business entity and an eligible business participant, and so receives the JobKeeper payment themselves.

https://www.business.gov.au/risk-ma...r-business/jobkeeper-payment-for-sole-traders
 
Write computer games.

Work at home.

No employees necessary, can still claim jobseeker.

Captive customers.
 
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