We know how to invest with a plan here at No Nonsense Forex.
But most people don’t.
Let’s separate ourselves from them even further.
What Is This Rule?
It’s very simple, but most people don’t realize it until you tell them.
Let’s say a stock takes a 90% loss during a bear market.
You buy it.
It then falls to a 95% loss.
How much have you lost?
You had to stop for a second and think about it, didn’t you?
You have lost 50%, not 5%.
“It’s Cheap Right Now”
All over social media, you have “investors” with no real experience talking about how cheap equities and crypto are right now.
Drives me nuts. Being able to asses the true value of a stock or crypto is a mighty big crown to placing on your own head there, Tyler from Kansas.
But they are at least looking in the right direction. It’s much better to buy things when price is down, not up.
This is not, however, a proper excuse to automatically hit the BUY button.
Some of these people, people who are buying at very low prices, will still get rekt.
And they won’t know how to handle it.
How to Better Handle It
We will go over this in more depth on this week’s 10-Minute Contrarian Podcast episode.
But let me give you a few cliff notes here.
First off, understand that if you want the asymmetrical alpha these investments can give you, you absolutely must be ready for the pain, and lots of it.
Minus 5 or so very lucky crypto billionaires, who caught lightning in a bottle, then actually had the sense to cash out near the top, there has never been a successful commodities or crypto investor who did not royally take it in the shorts first.
Even very conservative investors and firms are getting clobbered right now.
Bottom line — have an overall plan, then use your charts to assist you. This will put you ahead of 99.5% of all retail investors.
You don’t have to be dumb money, even though it may feel like you are right now.
Are you extremely bullish on the overall future of Newmont Mining? Ok good, then don’t worry about what price it sits at.
Focus on how much you have of it. If it’s so great, you would want more of it too, wouldn’t you?
Then this moment in time is a blessing, and you need to put the pieces in place to strike when it’s time to.
I can’t tell you “when” exactly. Nobody can.
But I will share what I can as we go forward.