🦧 dca is a must these days
🤷 perhaps a better strategy than most…
rule number 1️⃣: never lose money.
rule number 2️⃣: never forget rule number one!
those are words from warren buffett, the legendary oracle of omaha (y’all already know, that’s where i got my name from… lol)
but let’s think about that – how do you never lose money?
well, that is nearly impossible, but my key takeaway from rule number one is:
always invest in things that you’re comfortable holding on forever, never selling
if you ever have to sell (i.e. cashing out to afford a car), sell at a profit, never at a loss
i’ve seen the following scenario happen to a lot of retail investors (especially those just getting started)
you buy, say, three shares of s&p500 etf on wednesday (spy; one that im comfortable never selling)
within just a day or two, you’re down 2%, and you feel that you’re going to lose more if you don’t sell!
so, you sell all three shares at a 2% loss
the following monday, you wake up, and spy is at a price a little higher than what you originally bought!
what you should’ve done:
when spy is down 2%, if you had dry power (aka cash), buy 3 more shares!
now, you wake up on monday, and you have not three, but six shares of spy that are at a profit!
dollar cost averaging (“dca”) is what everybody should be doing in this current market.
they will recover, eventually.
you will profit.
sometimes it’s just that simple…
hope everyone had a great long weekend :)
i was not in the mood for work today ;;
always always feel free to email me (firstname.lastname@example.org) to ask any questions! :)
💡 something im thinking about…
🙏 closing comments
all of this is just one ape’s thoughts, but I would love to hear what you want to know about! happy trading!
as always, just another ape's thoughts and opinions – i am no financial advisor! (i am no substitute for professional financial services)
Ask a Wise Ape is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.