Reasons for failing in the stock market

Question 1

What are the components of successful investing/trading?

Answer 1

• System: Your rules for buying and trading
• Risk Management: Protection against risk. How much can you afford to lose.
• Psychology: Discipline, ability to make objective decisions, ability to digest information even if you have your own opinions, accept that you were mistaken and correct yourself
• Execution: Consistency on following your rules, ability to operate and improve

Question 2

Why do people lose in the stock market?

Answer 2

• No strategy: You don’t have independent thinking and foundational knowledge.
• Buying based on tips and rumors: You get easily swayed by trends
• No research: No effort to study and dedication to master the craft. Like any other skill, this is not easy and requires effort.
• Boy all-in: No risk management, you put all your money into the stock market and place your fate to chance.
• Boy kabado: Easily gets nervous when their money value gets low even by 5%, probably because they don’t have risk management too.
• Not knowing yourself: No self-awareness, you did not tailor made the strategy according to yourself, you just base your decisions based on the whims of other people, copy information from internet or books but don’t take the time to reflect and think about it, and how you will apply the information for yourself.

Question 3

What are some questions you can ask when processing information?

Answer 3

• Bakit ito ang ginagamit niya?
• Paano kaya ito babagay sa akin?
• Kaya ko kaya mag hold ng matagal sa isang stock? O medyo kabado ba ako?

Question 4

What is self-awareness?

Answer 4

• Conscious knowledge of one’s own character, feelings, motives, and desires.
• In peace with yourself