Dearest readers, the US market is not doing too hot, and crypto market as a whole is not far behind. Crazy, is it not? We have people who were predicting the bloodbath but not everyone listened because these kinds of predictions are never very accurate, time-wise at least. Also, once the downturn starts, they say hey, do not try to catch a falling knife- be careful. Speaking of "they say", they are many and they contradict each other all the time; so many voices, so much noise. Personally, as someone who is currently mostly a student of the markets and not really a participant, here are the things I learned over the last three years. Maybe we have some things in common.
After much back and forth, I decided I like RRSP's. Sure, there can be high management fees and sure, returns are small compared to what traders make, but this is for the long haul and tax deferral benefits are decent enough. However, I never max it out if in a particular year I just need more after-tax money on hand for something that might give me a bigger return in the short term, or if I simply need more after-tax money for basic life. I have also become a big fan of self-directed RRSP's because I like the idea of diverting some income away from big bank mutual funds and into low-cost etf's and individual companies I look into more carefully. Also, in a self-directed RRSP it is cheaper to make changes, it is possible to keep crypto if you believe in it via crypto ETF's, and also it is easier to invest into things like cybersecurity, psychedelics, agriculture, water and hydrogen related companies.
Another important thing I learned is that trading and investing are completely different and that there is way less literature and high quality information on trading versus long term investing. This tells me that short term and swing trading are both still in its early period because we have not had zero or low commission trading, high speed internet and advanced charting platforms for too long. As trading becomes democratized, there will be so much more to learn about it and we will have much more quality information out there to learn from. Why do I like it? I like it because it offers a chance to most of us mere mortals to make decent side incomes with small trading accounts- after initial losses and a steep learning curve (hopefully this changes over time). Learning to do this right, in my opinion, is one of the best ways to grow your after-tax cash savings.
Finally, I learned that regardless of whether you are investing or trading, you have to develop a mindset and methods that give you repetitive success in the markets and you also need to learn to control your losses. I really, really cannot compel myself to believe that any one move I would make in the markets will make me rich as if I won the lottery. Personally, I do not want to approach the markets that way. I believe I need to learn how to stay in the game and how to win more than I lose, when to act and when to stay away from the markets not based on greed or fear, but based on good information, decent analysis and a strict set of rules.
Have you come to any of these or similar conclusions? Did you have a paradigm shift or learn some more good lessons? Share if you like and have a great weekend! :)
After much back and forth, I decided I like RRSP's. Sure, there can be high management fees and sure, returns are small compared to what traders make, but this is for the long haul and tax deferral benefits are decent enough. However, I never max it out if in a particular year I just need more after-tax money on hand for something that might give me a bigger return in the short term, or if I simply need more after-tax money for basic life. I have also become a big fan of self-directed RRSP's because I like the idea of diverting some income away from big bank mutual funds and into low-cost etf's and individual companies I look into more carefully. Also, in a self-directed RRSP it is cheaper to make changes, it is possible to keep crypto if you believe in it via crypto ETF's, and also it is easier to invest into things like cybersecurity, psychedelics, agriculture, water and hydrogen related companies.
Another important thing I learned is that trading and investing are completely different and that there is way less literature and high quality information on trading versus long term investing. This tells me that short term and swing trading are both still in its early period because we have not had zero or low commission trading, high speed internet and advanced charting platforms for too long. As trading becomes democratized, there will be so much more to learn about it and we will have much more quality information out there to learn from. Why do I like it? I like it because it offers a chance to most of us mere mortals to make decent side incomes with small trading accounts- after initial losses and a steep learning curve (hopefully this changes over time). Learning to do this right, in my opinion, is one of the best ways to grow your after-tax cash savings.
Finally, I learned that regardless of whether you are investing or trading, you have to develop a mindset and methods that give you repetitive success in the markets and you also need to learn to control your losses. I really, really cannot compel myself to believe that any one move I would make in the markets will make me rich as if I won the lottery. Personally, I do not want to approach the markets that way. I believe I need to learn how to stay in the game and how to win more than I lose, when to act and when to stay away from the markets not based on greed or fear, but based on good information, decent analysis and a strict set of rules.
Have you come to any of these or similar conclusions? Did you have a paradigm shift or learn some more good lessons? Share if you like and have a great weekend! :)