How I lost $3700 and made $1500 with 3x leveraged ETFs

Long $UWTI

When I opened my DNB Trade account in 2015, my first trades were a bit crazy, among them:

  • $YHOO –  lost only 4%, but should not have touched it at all
  • $NBG – National Bank of Greece, lost only 25% (now delisted)
  • $CHAD, $CHAU – ETFs with 2x leverage that follow CSI 300 Index
  • $SUNE, $ZINC, $VRS – lost nearly 100%, delisted or went bankrupt

I tested my risk tolerance by starting with the most risky stuff I could find and when I got burned, moved to more safe things like sector ETFs with no leverage.

My most expensive lesson was from buying $UWTI – where I managed to lose about 80%, which amounted to more than $3700:

uwti Continue reading How I lost $3700 and made $1500 with 3x leveraged ETFs

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How to invest in stocks and outperform fund managers?

If we look at things very simply, there are 3 main options, how to invest in stock market:

1. Select stocks yourself

You can create a stock portfolio of companies that you believe in and hope that these companies will grow and make you rich. But to get good results over the long-term, you will also need to spend lot of time learning about stock market. If you don’t have time and will pick stocks without doing any research, you risk getting burned.

For example – this is how GoPro stock chart looked like after IPO – price shot up 300% from $30 to $90 in just 3 months. Imagine, how high it could go in 2 years? Let’s say, you would have invested $990 and bought 11 GoPro shares in Oct 2014, paying $90 for each share.

gopro_hype

Continue reading How to invest in stocks and outperform fund managers?