If you’re thinking of buying Bitcoin, read what I’ve got to say first

Today is 20th Dec 2017, bitcoin is at $17,689, confidence is high, the price has been rallying for a long time, there is a frenzy of excitement as many people discuss whether they should get in.

I understand people have got rich in bitcoin. But if you’re thinking of buying then read what I’ve got to say first.

10 years ago I had a go at trading, had lessons from a fund manager, read many books about the psychology, took it very seriously, had 4 screens, backtested my system, found it too difficult and stopped.

Sometimes the worst thing that can happen in life is to win first time, because then you think you have the magic touch not realising you got lucky, and with your new false sense of confidence you over-bet and loose it all. Which then really confuses you because you had redefined your identity as a wiz-kid-tech-investor and now you have an existential identity crisis on your hands.

I would rather understand why I’m winning small, than win big on luck, because with the first you sleep well at night with confidence in the stability of your cash flow, in the second you are constantly paranoid about what could happen next.

It’s the same in romance, I would rather understand why my partner likes me, than to get lucky with a super model and not know if she’s going to leave me tomorow for somebody who entertains her more.

I remember all the books joked about when the shoe shiner is recommending a stock it’s time to sell because the dumb money is flooding in and the smart money will have already started getting out.

You could become a billionaire, I don’t pretend to know, I accept I have no idea where the price is going. But the trouble is, if the price doubles, do you buy more, sell, or hold, if the price halves, do you buy more, sell, or hold. This is why trading is so difficult. without a system you are just a pin ball bouncing back and forth between your own greed and fear. That’s not investing, that’s not even trading, that’s gambling.

My teacher literally had me flipping coins and tallying the result to practise having no emotional response to wins or losses, to ensure I would trade on a backtested set of rules and not trade in response to emotions.

What you’ve got to remember with high stakes gambling is, people will only make noise about their wins, when they loose half their net worth in 30 seconds they won’t talk about it, you’ll only find out 5 years later when you bump into them on the street and they quietly confess they lost the fortune which they use to brag about it whilst prices were risings.

Also something to realise about the market is, there are no rules, the game is never over, nobody will ring the bell and say you’ve won, once you set sail on emotion instead of strategy, you’ll always be wondering whether to buy more, sell, or hold.

About benlowrey

Ben Lowrey is a Bristol based Acrobat, Internet Entrepreneur, Handstand Teacher, Talkshow Host & Law of Attraction enthusiast. More info >> about.me/benlowrey
Bookmark the permalink.

Comments are closed.