In investing we often say past performance does not always equal future performance.
But when it comes to reflecting on your investing past performance can equal future performance if you implement key lessons from your experiences.
In a multi-series of posts, I want to share with you my investing history and highlight the key lessons so you can become a better investor and achieve your goals quicker.
My journey as an investor started almost with disaster.
Back in 2010 when a good friend of mine mentioned a buddy of his had a share tip about a company called Falkland oil and gas.
(Source)
The company was drilling off the Argentinian coast and was suspected to have “possibly” found an oil well. A related company, Rockhopper Exploration Plc had found oil and share price exploded nearly 1000% on the announcement.
Similarly, one of the other companies with a licence to drill in the area was Falkland oil and gas (FOGL). I was saving for a house deposit with my girlfriend at the time and had one thousand pounds to invest together. Instantly we thought we could speed up our path to getting a house deposit together.
We bought shares and incredibly quickly the value started to increase and before we knew it we had 200% gains. However, there was a news announcement by the company over the weekend to confirm whether the company had found oil. Monday came and it was not good. Oil was not confirmed in the samples and more analysis was needed. Immediately, the share price gapped down. We managed to get our money out with a ~20% gain.
My first lesson in investing that to this day still challenges me: Hold winners, but know when to cash out. In hindsight, this could have been a big winner, but let’s be honest it was abit of speculative bet.
Could of gone either way.
From today’s eyes, I have learnt that when the share price goes up parabolically due to speculation or without a fundamental driver, have caution, nine times out of ten it will fall back to earth as quick as went up. Good recent example is FUBOTV ($FUBO). Huge speculative run up in thin markets before Christmas with no fundamental driver.
In the next post, we’ll explore part 2 of my story and the power of focus in determining how successful you will be as an investor.
Click here for Part 2
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Nothing in this post is intended to serve as financial advice. Please do your own research.