Author Topic: How to deal with losing $117k in stock market?  (Read 12736 times)

TomTX

  • Magnum Stache
  • ******
  • Posts: 2920
  • Location: Texas
Re: How to deal with losing $117k in stock market?
« Reply #50 on: December 19, 2017, 05:28:56 AM »
My student loans interest is 4.85%. Mortgage is 4.35%. I would like to make a decision by end of year as to what to do. I lost a lot of confidence in my investing ability and afraid everything I buy will end up in a big loss. But if I quit the market completely, I will feel bad knowing I threw away $117k with nothing to show for it.

Bolded for emphasis.

Good. Glad you are getting some sense.

Stop trying to "beat the market" and just "buy the market."

TomTX

  • Magnum Stache
  • ******
  • Posts: 2920
  • Location: Texas
Re: How to deal with losing $117k in stock market?
« Reply #51 on: December 19, 2017, 05:32:30 AM »
I loaded up on oil exploration companies in November 2015 after big oil crash. Invested in Sandridge Energy (SD), EXXI, Penn Virgina (PVA), Goodrich Petroleum (GDP), Seadrill (SDRL), Breitburn Energy, Lynn Energy etc. They all filed Chapter 11 and my money essentially decreased by 70%. I then moved over to biotech in 2016 during Presidential Election. Was doing great and then near Election time, Hillary Clinton decided to attack the Pharmaceutical companies. I was on margin because I was confident the companies I invested in would get FDA approval (using my scientific knowledge as a Pharmacist). All biotech stocks plummeted in October 2016 and I was forced to sell at a lost due to margin call.

And that's why you don't gamble on margin.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 2161
  • Location: EastCoast
Re: How to deal with losing $117k in stock market?
« Reply #52 on: December 20, 2017, 02:35:19 PM »
Hard to believe in one of the biggest bull market in history, I have lost $117k in the last 3 years investing in high risk oil and biotech stocks. I am disgusted with myself everytime I think about how much I've lost. I still owe $153k in student loans and $110k in Mortgage. I really want to run away from the stock market, accept I will probably never be able to regain my losses and focus strictly on paying of my student loans.  But I love to follow stocks (my main hobby) and the thought of withdrawing from the market makes me feel depressed. I also worry about missing out if tax reform is passed and the market continue to jump in 2018. What should I do?

So you have a hobby that cost you $117k in 3 years. If that's what you love to do keep doing it, as long as you accept the cost. Personally I'd rather own a 40 ft sailboat, which would still be cheaper and I think more fun, but to each their own. *shrug

ChpBstrd

  • Handlebar Stache
  • *****
  • Posts: 1037
Re: How to deal with losing $117k in stock market?
« Reply #53 on: December 20, 2017, 09:20:30 PM »
Y'all be nice. It takes some badass courage to walk into the internet, admit to a six-figure mistake, and ask for advice moving forward. It takes zero courage to mock such a person. 

Apple_Tango

  • Bristles
  • ***
  • Posts: 284
Re: How to deal with losing $117k in stock market?
« Reply #54 on: December 20, 2017, 10:04:04 PM »
Iím definitely on the index/mutual fund train :) my portfolio is more complex than it needs to be, but Iíve still got over 50% in VTSAX. Some in a far out target retirement fund to get some bonds/rebalancing without me having to do squat, some is a growth fund that I love,  A very small amount in a gold fund which has been not been too hot but Iím keeping it anyway, etc. I started with VTSAX when I was 18, and Iím obsessed wih it.Iíve added to that portfolio because picking index funds is actually really fun!!!  I had to freaking sit on my hands to not jump into the new Global Wellesley and Wellington funds that came out this fall. Iím done expanding for the foreseeable future.

Maybe you can find a similar thrill in researching index funds and making money, than you were able to do with researching the stock picks.
« Last Edit: December 21, 2017, 11:40:23 AM by Apple_Tango »

Fuperw84

  • 5 O'Clock Shadow
  • *
  • Posts: 26
Re: How to deal with losing $117k in stock market?
« Reply #55 on: December 21, 2017, 04:58:57 AM »
Y'all be nice. It takes some badass courage to walk into the internet, admit to a six-figure mistake, and ask for advice moving forward. It takes zero courage to mock such a person.

I feel ashamed of my past financial mistake so nothing anyone say can will make me feel more ashmamed than I already feel. I am determined to recover from this loss and learn to never repeat it again. I appreciate all opinions and advises in this forum.

I'm a red panda

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: United States
Re: How to deal with losing $117k in stock market?
« Reply #56 on: December 21, 2017, 06:14:07 AM »
I loaded up on oil exploration companies in November 2015 after big oil crash. Invested in Sandridge Energy (SD), EXXI, Penn Virgina (PVA), Goodrich Petroleum (GDP), Seadrill (SDRL), Breitburn Energy, Lynn Energy etc. They all filed Chapter 11 and my money essentially decreased by 70%. I then moved over to biotech in 2016 during Presidential Election. Was doing great and then near Election time, Hillary Clinton decided to attack the Pharmaceutical companies. I was on margin because I was confident the companies I invested in would get FDA approval (using my scientific knowledge as a Pharmacist). All biotech stocks plummeted in October 2016 and I was forced to sell at a lost due to margin call.

And that's why you don't gamble on margin.

I learned that from watching Saved by the Bell. Zack lost a lot of money.

Is there any reason to buy on margin other than gambling? I'm not sure I understand it. TV just taught me not to do it.

boarder42

  • Walrus Stache
  • *******
  • Posts: 7530
Re: How to deal with losing $117k in stock market?
« Reply #57 on: December 21, 2017, 07:11:24 AM »
I loaded up on oil exploration companies in November 2015 after big oil crash. Invested in Sandridge Energy (SD), EXXI, Penn Virgina (PVA), Goodrich Petroleum (GDP), Seadrill (SDRL), Breitburn Energy, Lynn Energy etc. They all filed Chapter 11 and my money essentially decreased by 70%. I then moved over to biotech in 2016 during Presidential Election. Was doing great and then near Election time, Hillary Clinton decided to attack the Pharmaceutical companies. I was on margin because I was confident the companies I invested in would get FDA approval (using my scientific knowledge as a Pharmacist). All biotech stocks plummeted in October 2016 and I was forced to sell at a lost due to margin call.

And that's why you don't gamble on margin.

I learned that from watching Saved by the Bell. Zack lost a lot of money.

Is there any reason to buy on margin other than gambling? I'm not sure I understand it. TV just taught me not to do it.

crash like 2008 where the market loses 40% of its value i could see as a reasonble time to possibly take out some margin - though i'd use protected margin via a cash our refi or HEL

soccerluvof4

  • Magnum Stache
  • ******
  • Posts: 3373
  • Location: Artic Midwest
  • Retired at 50
    • My Journal
Re: How to deal with losing $117k in stock market?
« Reply #58 on: December 21, 2017, 02:15:41 PM »
I've lost a lot more money than that in the past. Bottom line is forget it and only look in the rear view mirror to learn. You have time and an income on your side so follow the advice people said on here, forget trying to hit the home run and you will be more than fine. Just don't make the same mistake twice.

bwall

  • Bristles
  • ***
  • Posts: 425
Re: How to deal with losing $117k in stock market?
« Reply #59 on: December 26, 2017, 11:49:10 AM »
I know this post is a bit old, but here are some more thoughts that can perhaps help someone else who wants to trade the stock market.

OP picked two sectors; first oil, then bio-pharma.

If you're trading, and a stock goes down, you have to ask the question 'why'? Did it report bad numbers? Did the CEO quit? Was there something material that specifically affected their business? Presumably, the answer to all these was 'no'. What advantage do you have? What do you know that the market doesn't know?

Who was on the other side of the trade? Why did the stock go down? Because the price of oil went down. Why did the price of oil go down? Because the Saudis made a political decision to open the taps and drive the competition out of business. The oil price (and therefore oil sector stocks) cannot go up until the Saudis are done. When will they be done? Dunno. Can the companies still make money at these lower prices? I guess we have the answer now, and it's 'no'.

A lot of other very smart people, even people in the oil sector, made incorrect decisions. Harold Hamm lifted his hedges (sold when oil was at $110 or so) when oil was at $85. He could've waited and made a lot more money, but he didn't.

OK; now to look at the bio-pharma sector:

Here you have a competitive advantage as a pharmacist. You understand the jargon and you 'common sense' level is higher. But, before you invest blindly in a bio-pharma, you have to do your research:

1) What phase is their research in? Phase I,II, or III?
2) How big is the market for their product?
3) Is this a 'real' innovation, or a 'me-too' product?
4) What are the qualifications of the CEO? Is he also an MD? Or just some MBA that knows nothing about science and research?
5) What is their 'burn-rate'? How many more months can they operate before they have to issue new shares?

These are just questions, comments and insights from someone who plays the market for fun and profit. A Wall St. pro would look at this and laugh. If you can't (or don't want to) do this research, then the best thing VSTAX index funds is by far the best investment. I've also got a lot of VSTAX, btw.


 

fmzip

  • Stubble
  • **
  • Posts: 190
  • Location: CT
Re: How to deal with losing $117k in stock market?
« Reply #60 on: January 01, 2018, 07:28:09 PM »
Commit to this:

Let the $117K loss be just that. Don't try to get it back by buying individual stocks, you will likely lose more than you ever gain.

My good friend got burned too to the point of 1.2M in losses in the oil sector. He has balls, now he sits on 62,500 shares of AT&T worth $2.5M. It's his only holding....

Pigs get fat...hogs get slaughtered. You can gain great wealth by taking the slow boat. You do it right, commit to a plan and stick with it.

Again, commit to this, the $117K is a learning lesson. I've lost that and then some over the years. Don't be like my other buddy who just turned sixty that has been out of the market since 2009 because he was too scared to get back in. You will be invested all your life, just be prepared to loss 50% of whatever money you throw at the stock end of the portfolio.

How old are you if I may ask?

Mighty-Dollar

  • Bristles
  • ***
  • Posts: 358
Re: How to deal with losing $117k in stock market?
« Reply #61 on: January 02, 2018, 01:25:32 AM »
What should I do?
I've been investing for like 30 years. Once thing I eventually learned was to stop trying to cherry pick the next hot sector or individual stocks. Instead just buy the broad market (ex- a total stock market index fund or an S&P 500 index fund). If you want more risk then just add QQQ (the NASDAQ index fund). Keep it simple.
Also observe age appropriate diversification into bonds (via a total bond market index fund).

TheOldestYoungMan

  • Pencil Stache
  • ****
  • Posts: 749
Re: How to deal with losing $117k in stock market?
« Reply #62 on: April 27, 2018, 11:50:52 AM »
I hesitate to push a gambler into anything anywhere near their addiction.  But you can't avoid money in this life.

Your earning potential right now is very high.  You've got a little bit of debt still, so you can pay that down and put yourself into a very good position to weather future storms.

I would make a very conscious effort to keep financial aspects of your life as simple as possible and replace the time you were spending on those things with other productive uses.  Find yourself a replacement hobby.

Become a great swimmer, tackle a cycling distance challenge, learn a musical instrument.  Take cooking classes or dance classes.  Learn to weld.

Once you've let some time pass and distanced yourself from the previous addiction, re-engage with long term financial planning with oven mitts and a face-mask.

The overwhelming majority of the information out there is designed to separate you from your money.

Anything on television should be ignored.  Throw the TV away.  Do it today.  Well, sell it.  Or keep it, but it is for movies only, cancel the cable, get some amazon prime.

When you think you've kicked the stocktrader habit, remember this:

By an overwhelming majority, the best investors are dead, or forgot about their accounts.  Buy, then hold.  Never buy with the idea that you will sell.

Read the Collins stuff: http://jlcollinsnh.com/
Read this nutjob's stuff: http://earlyretirementextreme.com/
Read this blog.

Keep expenses low, avoid debt, invest without greed.

You are wealthy, and you have a responsibility to act like it.  The opportunity is yours to be seized.

Here's a video from warren buffett, he invented the all you can eat buffet or something...

https://www.youtube.com/watch?v=mOS4wAsBnvM

If you make it through that and are not convinced, seek professional help, because literally the most capable investor the world has ever known is practically begging you to wake up and realize that the best available option for those of us that aren't going to go actually work at improving the companies we own is to just own all the companies and hope for the best.


Cwadda

  • Handlebar Stache
  • *****
  • Posts: 2104
  • Age: 24
Re: How to deal with losing $117k in stock market?
« Reply #63 on: April 27, 2018, 12:04:50 PM »
Quote
But I love to follow stocks (my main hobby)
You should probably look for another hobby. Either that, or keep a "dinner party" fund available. Put $500 in there and stock pick so you can bullshit around with people at social events.

Everything else goes in low cost index funds.

Much Fishing to Do

  • Bristles
  • ***
  • Posts: 318
Re: How to deal with losing $117k in stock market?
« Reply #64 on: April 28, 2018, 03:44:34 PM »
I would like to make a decision by end of year as to what to do.

Slow down buddy, you very aggressively invested with (I guess given the heartbreak) most of your savings which is generally impatience.  Continuing to be this impatient in your attempted recovery is just gonna lead to more of the same high risk taking which will very likely lead to more losses.  I frankly like the idea of you focusing on paying off your loans so you see positive traction while more time passes and you get further away from these losses, the memory of which is gonna drive you to more risk in the attempt to quickly recover.

talltexan

  • Handlebar Stache
  • *****
  • Posts: 1674
Re: How to deal with losing $117k in stock market?
« Reply #65 on: May 02, 2018, 01:12:28 PM »
I've been thinking about the following approach for a "fun trading" account:

Put 90% into bonds, something very safe and with a fairly high yield. The other 10% can go into something risky, like options on whatever stock ideas I get. The income from the bonds can gradually replenish that, but that way I get something that is moving every day, but also fairly sustainable. Thoughts?

Scortius

  • Bristles
  • ***
  • Posts: 420
Re: How to deal with losing $117k in stock market?
« Reply #66 on: May 02, 2018, 01:45:49 PM »
Quote
But I love to follow stocks (my main hobby)
You should probably look for another hobby. Either that, or keep a "dinner party" fund available. Put $500 in there and stock pick so you can bullshit around with people at social events.

Everything else goes in low cost index funds.

For an alcoholic, there never is 'just one drink'.

boarder42

  • Walrus Stache
  • *******
  • Posts: 7530
Re: How to deal with losing $117k in stock market?
« Reply #67 on: May 03, 2018, 07:38:57 AM »
you all realize this post is old right?

DavidAnnArbor

  • Handlebar Stache
  • *****
  • Posts: 1678
  • Age: 52
  • Location: Ann Arbor, Michigan
Re: How to deal with losing $117k in stock market?
« Reply #68 on: May 03, 2018, 04:09:21 PM »
But the lesson is timeless.

boarder42

  • Walrus Stache
  • *******
  • Posts: 7530
Re: How to deal with losing $117k in stock market?
« Reply #69 on: May 04, 2018, 07:09:03 AM »
thats probably where people should be commenting not in his old thread about his gambling problem.

gpyros85

  • Stubble
  • **
  • Posts: 147
Re: How to deal with losing $117k in stock market?
« Reply #70 on: May 12, 2018, 01:57:50 AM »
If it makes you feel better, I lost around $40,000, obviously less than you but I don't know if it was the stab in the back or the pat on the back but I was forced to sell due to margin, I had some naked put option to buy at low prices and I didn't have enough liquidity in the bank. The stock never hit those put options but it forced me to sell OTHER shares such as Suncor Energy at the lowest point $20, it is now almost $40/share....


I also had negative overall returns in the hottest bull market. Now I have a lot of cash because I am out of trading waiting to get back into the S&P and patiently waiting...

electriceagle

  • Bristles
  • ***
  • Posts: 429
Re: How to deal with losing $117k in stock market?
« Reply #71 on: May 12, 2018, 08:13:48 AM »
Consider it tuition. I think that most of us who moved from trading stocks to investing in index funds have paid it in some amount or another.

I myself traded stocks and options for many years. Heck, I even put together a project that combined video games on phones with a complex trading system (I come up with some dumb ideas!).

One day, I decided to compare the net worth produced by my work and research to what I would have made by simply buying and holding an S&P index fund. The results were about the same.

I didn't know what I was doing, didn't understand the complex stuff that I was attempting, and could have mastered another language with the time that I put in, without losing a cent. Off to index funds I went.
« Last Edit: May 12, 2018, 08:19:16 AM by electriceagle »

Fuperw84

  • 5 O'Clock Shadow
  • *
  • Posts: 26
Re: How to deal with losing $117k in stock market?
« Reply #72 on: May 14, 2018, 05:37:07 AM »
Thank You for the opinions and feedback. I have been out of the stock market the last few months. Currently focus on paying off all my credit card debts. I will finish paying off all credit cards this month. My next focus is paying off my student loans ($137k). I will be paying $5,000 monthly starting in June. I will be getting back into stock trading but with major changes. I'm going to put $5k in Fidelity and make the best out of that starting fund. I made a promise to myself to never put a single dollar more into my brokerage account. The maximum risk I'm willing to take is $5k on individual stocks. Being a responsible adult involves having discipline and self-control.  Giving up on stock completely is too difficult for me, especially since I have too much interest and it's my main hobby.

pbkmaine

  • Walrus Stache
  • *******
  • Posts: 7419
  • Age: 61
  • Location: The Villages, Florida
Re: How to deal with losing $117k in stock market?
« Reply #73 on: May 14, 2018, 07:23:42 AM »
Thank You for the opinions and feedback. I have been out of the stock market the last few months. Currently focus on paying off all my credit card debts. I will finish paying off all credit cards this month. My next focus is paying off my student loans ($137k). I will be paying $5,000 monthly starting in June. I will be getting back into stock trading but with major changes. I'm going to put $5k in Fidelity and make the best out of that starting fund. I made a promise to myself to never put a single dollar more into my brokerage account. The maximum risk I'm willing to take is $5k on individual stocks. Being a responsible adult involves having discipline and self-control.  Giving up on stock completely is too difficult for me, especially since I have too much interest and it's my main hobby.

I was a financial planner for many years, and used to make a deal with clients like you: I would put 90% of their investable assets in index funds, and they could do anything they liked with the remaining 10%, including building a bonfire in the backyard and burning it. By actively trading stocks, most of them ended up burning the money just as thoroughly as a bonfire would, but 90% of their money was safe. If you can strike the same deal with yourself, you should be fine.