Journey from Robin-hood trader to Investor

 

Initial Start of and end of Journey in field of Stock market:-

I am not a market expert nor a financial advisor. I am neither a CA nor a financial planner. I am an Engineer in Electrical Field and working in different fields such as Civil, Audit, Mechanical and Pipeline. Just have experience of more than 17 years and as usual with zero return from share market.

I entered into stock market in year 2007 and still looking for returns from stock market. I opened an account while working in textile industry where I have got interaction with Gujarati people which are expert in this field. They told me to open an account in stock market so I did. After opening an account I purchased shares having value about Rs.25000/- at that time, I bought very low quality shares with no future at all and I closed my account after losing Rs.15000/- in stock market.

Re-entry into stock market:-

But this wasn’t end of my love for stock market as this lightened up a flame of getting richer in few days by using stock market and I again entered into stock market in year 2010 and this time with good amount so that I can capture the stocks and make a good amount. For doing so I opened my account with broker firm and the person which was looking after my account always keep on saying that sir you should try intraday as you will be millionaire in very short period of time as you can use leverage that offered by brokerage firm. He even told me that he himself is the market expert can capture the stock movement. So he told me that he will place orders in your behalf and will give you handsome returns.

So I give him consent to do the same within days my whole investment of Rs.2.00 lacs has gone into zero. I blamed a lot for this as Rs.2.00 Lacs was a big amount for me as we were already living a bad shaped life that time as we don’t have even bed for sleeping at that time. But this experience was enough for me to not to give a person any authorizations to trade on your behalf.

Start of Robin-hood Trading:-

But this is not end of my trading as get motivated more to do the same by myself as I will do the controlled transactions so I picked up following loans:-

(a)    Personal loan

(b)   Credit card loan

I picked up-to 4.00 lacs loans against the same to cover-up my losses which that person has done. So this time I started trading and Infact I kept on trading for whole day without doing any work. I even purchased subscriptions of stock recommendations during intraday. I become a Robin-hood trader as always keep on doing trading shifting across all stocks looking for some at the end of day but nothing was going in right way.

I even tried BTST, Holding the stocks for 1-2 days which are making 52 week highs on daily basis, Buying low quality stocks and at the end I lost all money again. Between years 2010-15 I lost around Rs.15 lacs and still keep on doing same mistakes again and again.

While doing trading you even find friends with same taste and we always keep on discussing about stocks but no one is telling his realty as I know that he was also at loss but he is never going to accept the same. So even joke about his and my pickings in the stock market.

Now I entered into Futures and Trading in commodities with the help of my friend as we planned to take loan and start doing trading. We always thought we are perfect and have knowledge of stock market and we going to make killer gains this time around and we have loan of Rs.10.00 lacs and Rs.5.00 Lacs respectively through personal loan and credit card. We made some gains initially but this happiness lasts only for few days as we started trading in multi-crores and sometimes we have holdings of more than crore. At the same result was same and we lost the amount in span of 3-4 months.

But love for stock market not getting down as we got addicted to this and we kept on doing trading with smaller amounts but at the end we lost all the money we have.

Start of Investments

In year 2018 I have taken personal loan of Rs.20.00 lacs and saved few amount from salary and make investments into account and this time I purchased few quality stocks and few of very bad stocks. At that I got realized that I am not going to make money through intraday method so planned to keep stocks in account to gain from that investments. But again I made a mistake I bought more than 100 stocks with investments here and there and in year 2020 when corona wave arrived when whole world was under lockdown except stock market I again started intraday and lost about 3-4 lacs in the same period.

But again stopped with deep regret in heart and mind that even after losing more than 50 lacs in stock market I am still looking for gains from Intraday. That day in decided not to do intraday trading even when I know that this stock will get benefit from that particular news and then sold all my holdings to purchase some quality stocks. So purchased quality stock at that time. My investments get reduced to Rs.16 Lacs at that time.

But now my portfolio has stability with mixtures of returns and dividends now investments has been reached Rs.23.00 lacs.  

I have lost more than Rs.50.00 lacs over the period of 15 years. Rs.50.00 lacs was the basic amount I have lost apart from interest over loans and returns which I could I have generated should I have kept patience during that time.

 

Mistakes of my life:-

(i)                  Entry into stock market without even reading about balance sheets of stocks and fundamentals of that stock. Taking tips from others regarding the stocks.

(ii)                Doing intraday trading, intraday trading will never be called as investments.

(iii)               Taking loans for doing Trading and Investments.

(iv)              I never started from IPOs which is always told by experts to start investments in market through IPO route.

 

Lessons I have learnt:-

(i)                  Always purchase quality shares with handsome balance sheet, giving good dividends, and Good corporate governance and should have given returns in past 10 years.

(ii)                Never be a Robin-hood trader, you will always looking to cover brokerage charges and try to cover up the losses which you have made in past in quick time. Though it will never happens.

(iii)               Don’t try to time the market, market will flow with its future course of action. Buy that stock which you can keep for long term and more than 10 years. As said by Warren Buffet that always buy the stock which you can keep even when no trading is going to happen in next 10 years.

(iv)              Never even took loans for investments. Invest only the amount you save from savings as interest of loan will take your all the gains from market.

(v)                Never expect extra-ordinary returns from stock market. Stock market will give you 13-15% returns on annual basis.

(vi)              Apart from Direct stocks investment I have done investments in mutual funds and I am getting 12-13% returns from that investments. This lesson I have learnt from my investment in mutual fund which I have done mistakenly as stated in previous article:-

https://electrialstandards.blogspot.com/2022/03/finance-for-non-finance-persons.html