To The Moon

In Q1 2022, we had experienced lots of issue, for instance, Omicron variant, war between Russia & Ukraine, increase of interest rate by FED etc. As such most of the stock market had went into a major correction and caused a lot of investors to loss their paper gain & some even faced loss in their portfolio, and I am not excluded. However, because of these major correction, I truly believe that these are the opportunities to earn big and somehow I like correction where I can buy my favorite stock with a much lower entry price!!! [得意] 

As such, I managed to topup some units of Apple twice during the big drop and nearly bottom, at around 150-155, and it had went back to 174 as of now which gave me nearly 50% of gain.[邪惡] 

I would had always read when the market is slow and panic, which I reread some of the books by Warren Buffett and therefore I would like to share some of my gains from him:

1. Be Greedy When Others are Fearful

I believe most of the investors heard this famous quote from Warren Buffett, he said: “Be fearful when others are greedy and Be greedy when others are fearful.” But, how many of us would actually able to execute this? What most of us practice is the other way round.

I always believed in this quote, but it was extremely hard when I try to execute it. We human beings are emotional, and stock market is where the battle of human’s psychology took place. Most of the time, I will tell myself that “Do Not Enter when Excited and Do Not Exit when Panic”. This is because emotion will affect my decisions which could lead to my gains or losses.

2. 1:3 Risk Reward Ratio (RRR)

I had always emphasize on risk reward ratio. Before I click on the Trade button, I would had plan my strategies in advance. For instance, where shall I stop loss if I’m wrong about the fearful throw? What is my minimum reward I want to achieve?

For sharing purpose, most of the time I would plan a 1:3 risk reward ratio, which is stop loss at 10%, take profit at least at 30%. I trained myself to be so discipline that I would not hesitate to stop loss when it reached my stop loss point, but for most of the people, they think that paper loss is not a real loss, but ultimately, reluctant of stop loss will cost your time opportunities and capital opportunities, where you can invest the chips on a better stocks.

In general, these are parts of my trading ideology during first quarter of 2022 where we can pick the strong and disqualify the weak. I wish everyone here had a great investing journey ahead!!![比心] [比心] [比心]