Lubomir Kramar @onk342: "𝐀 𝐛𝐮𝐧𝐜𝐡 𝐨𝐟 𝐰𝐞𝐞𝐤𝐞𝐧𝐝 𝐭𝐡𝐨𝐮𝐠𝐡𝐭𝐬 There..."

Poland

Edited

𝐀 𝐛𝐮𝐧𝐜𝐡 𝐨𝐟 𝐰𝐞𝐞𝐤𝐞𝐧𝐝 𝐭𝐡𝐨𝐮𝐠𝐡𝐭𝐬 There are many different ways to be profitable in the stock market, but there is just one way to get broke. Equally, there are many different assets that can bring you high returns, but it’s enough to get it very wrong just once to annihilate your portfolio. Yes, there have been thousands of people writing about it, but I get to see people making the same mistake DAILY, so it’s clearly worth revisiting. 𝐆𝐚𝐢𝐧𝐬 𝐚𝐧𝐝 𝐥𝐨𝐬𝐬𝐞𝐬 𝐚𝐫𝐞 𝐧𝐨𝐭 𝐞𝐪𝐮𝐚𝐥. There are always plenty of hot picks in the market, be it up-and-coming companies, altcoins, or NFTs (remember those?) that can/could teleport your investment ‘to the moon’ in days. Some of them are run by hype, some by flashy announcements, some by pure greed with no clear explanation. There is nothing inherently (or God forbid, morally) wrong about having those positions in your portfolio. However, what is very wrong about it is how many people downplay the risk that goes along with investing in such assets. What goes up 100% in a week could go down 60% over the next week, and all of a sudden… you are in the red. 𝐍𝐨𝐭 𝐚𝐥𝐥 𝐚𝐬𝐬𝐞𝐭𝐬 𝐚𝐫𝐞 𝐜𝐫𝐞𝐚𝐭𝐞𝐝 𝐞𝐪𝐮𝐚𝐥. That’s why the vast majority of experienced investors don’t chase the next hot thing. That’s why very few of them are impressed by 100–1000% rapidly made returns by portfolios invested in the hyped-up assets. Simply put, if you want to make it long term, the risk comes first and the potential return comes second. Overcommitting to a single idea and losing 90% of your initial investment (which happened to quite a few altcoins in the previous cycle) puts you in a situation where you need to make 900% just to break even. Needless to say, that propels a lot of people towards taking even more risk and essentially ending up burning money. Now, there are certain assets that make it almost impossible to lose it all, even if you commit 100% of your portfolio. I probably don’t need to convince anyone that the chance of $KO (Coca-Cola) going bankrupt is very slim. Likewise, the chance of the US defaulting on its bonds is still meagre (I mean, if that ever happens, the global markets are cooked anyway). The moral of the story is not that you should buy $KO (Coca-Cola) but that the profitability, size, and even reputation behind your assets plays a major role in investing. The less profitability, size, and reputation your picked asset has, the more risk it carries. Finally, this is not by any means a crusade against small caps, altcoins, or whatever asset out there in the market. It’s ok to have them in your portfolio. But if there is one lesson everyone learns the hard way in the stock market, it’s that protecting yourself from the downside is the first step towards successful lifelong investing. So for the love for your own money, don’t commit a high percentage of your portfolio to one flashy concept. Best regards, LK $SPX500 (SPX500 Index (Non Expiry)) $NSDQ100 (NASDAQ100 Index (Non Expiry)) $UK100 (UK100 Index (Non Expiry)) $GER40 (GER40 Index (Non Expiry)) $FRA40 (FRA40 Index (Non Expiry))

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Coca-Cola

SPX500

NSDQ100

UK100

GER40

FRA40

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