“Be smart. Invest in your future, don’t trade away your present.”
All too often we hear stories of meteoric success on the stock markets. It is rare for us to hear stories of catastrophic failures, like the one you are about to read. Just like how we learn from success, we can also learn from failure and mistakes. Often, the latter is a much better teacher than the former.
There are many reasons why people invest – some wish to protect their wealth against inflation while others hope to acquire wealth outside of their monthly pay-checks. However, investing is not just a game to play. As the subject matter of this piece learnt the hard way, it can have significant implications on the lives of people. Usually, the people who find themselves in such predicaments only realise it when it’s too late.
Losing 300k in the stock market
To caution others against making the same mistakes he did, Mr X, who reached out to Wake Up Singapore on the condition of anonymity, shared his unfortunate experience of losing his life-savings trading in the stock market.
Only a handful of close friends know I lost all my life savings as my family and social network have no idea, they think I’m still well invested.
Mr X lost lost his entire life savings, amounting to SGD 300,000, by trading contract for differences, or CFDs, over the past 2 years. According to Investopedia, CFDs are “an agreement between an investor and a CFD broker to exchange the difference in the value of a financial product between the time the contract opens and closes”.
Wake Up Singapore has had sight of his financial statements, which evidence that he had accumulated more than SGD 299,561.55 in losses.
Like many other Singaporeans, he started day-trading during Covid-19 in hopes of creating a healthy nest egg. On hindsight, Mr X observes that “hope turned into greed, and finally greed turned into despair”.
He lost everything he had. At first, he felt that he was a normal trader accumulating wealth like many others, until he found himself tumbling downwards one day.
I used to feel happy and successful in life, I had a house, a car, I saw a future.
Now all I see are mortgage payments, a car loan, and a need to start again from zero after throwing away everything. You see, I thought I knew how to trade. I read all the horror stories. But I didn’t understand what it meant to lose everything, until I had nothing left to lose. I used to live, and now all I can do is survive.
There is no way to recover my losses as I have no more money left to trade with, nor do I dare.
3 pieces of advice
He shared 3 pieces of advice to budding investors and traders so that others can learn from his mistakes:
First, there is a difference between investing in stocks and trading stocks. The latter is gambling. Be prepared to lose it all and know when to walk away from the table. Investing is what every adult should do to build a nest egg for the future.
Second, he reminded all to follow the advice of those who know better. It’s better to not earn a little more money than losing a lot of money. He also gave an example of where he knew he should have followed advice, but greed got the better of him:-
My close friends told me to bank my profits, collect my initial investment and then use my earnings to trade as the market could crash anytime. I knew they were right, but I never followed their advice as I wanted more, and more.
Even when I started losing, and they told me to get out completely and sit on whatever cash I had left, I still didn’t listen, in the hopes that I could make back what I lost. In the end I lost even more. So make sure you follow the advice of smarter people. It’s better to not earn a little more money than losing a lot of money.
Finally, he said, “you have a lot more than you realise, don’t waste it”. Mr X never appreciated how much money he had truly saved up in my life until he lost it all. He learnt that there was some truth to the old adage of being safe, not sorry.
His parting advice was for people to refrain from trying to be the 1% of people who turned millionaires overnight. Such situations are, in all likelihood, due to luck and chances. Most of us would lose it all trying.
I want to make clear to everyone is that we CAN all be successful. We CAN be the 1%.
But don’t take the shortcut there unless you’re prepared to lose it all, and can afford to lose it all. I’m not scared from this experience. I’m not deterred from trading ever again, or from stepping into a casino. I am grateful for the hard lessons I’ve learnt, but I guess I wouldn’t have learnt them if I didn’t go through this.
The “Comeback” NFT?
As he lost his investment savings, he started teaching himself about NFTs as an alternative way to get his message across. An NFT is a digital asset that represents real-world objects like art, music, in-game items and videos.
He minted an NFT to showcase his heart-breaking loss. It is priced at 93 ETH (a cryptocurrency), which is roughly equivalent to the SGD 300,000 he lost from trading in the stock market.
I do believe I deserve a second chance, which is why I created the NFT as a reflection of not only who I was, but who I aspire to be. Because I can assure you, if I get a second chance at making something of my life, I will remember my past mistakes, learn from it, and come out stronger the next time
Mr X would like this NFT to be viewed as an “art-work” of his life encapsulated as a photo. In his own words, he “dreams” about being on the receiving end of a stranger’s benevolence via the NFT.
I can only dream of being on the receiving end of someone’s benevolence in acquiring my NFT, but my true goal in creating this, and submitting this story to you is to spread awareness. I could write a book on how not to trade. I may have lost my entire monetary value, but my true value within lies with the experience gained from the money lost. This is the story I wish to share.
It remains to be seen if this NFT would bear fruit and help turn Mr X’s life around.
We wish Mr X all the best in his journey and thank him for sharing his insights for our readers to learn from.
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