So today I learned one of life’s valuable lessons that you should always have patience, because in the end it always pays off. It came from one of my areas of interest: the stock market.
I have been an investor since November of last year with an online brokerage (Questrade). Time and time again, I have learned that buying and holding on to stocks is always more rewarding than to panic and sell. A good example of this is when I bought Sirius XM last year (NASDAQ:SIRI). This was a stock I had a good feeling about. The company is a virtual monopoly on the satellite radio market. I bought in at $0.25. Now fast forward to last month. Sirius was in trouble, and stock prices had fallen to $0.07 on the threat of bankruptcy. I panicked, I figured my savings would never recover and I sold. Thus I lost about $120 worth. This may not seem alot but it becomes more apparent once you notice that SIRI now trades at about $0.40, that’s almost 8x as much as it traded last month! Whoever bought it back when it was $0.05 must have made a handsome profit. If I had held on to what little I had left, I could have not only recuperated my losses, but actually made profits as well!
Now today I learn again why being patient is important. I now hold a diversified portfolio with my buying power reached to the limit. Since SIRI stock was soaring, I wanted to buy more of it to see what happens. Since I had about 400 shares of Yamana Gold (NYSE:AUY) taking up most of my portfolio, I made the very stupid decision of selling 100 shares in order to free up buying power. As a result, I lost alot of money. The reason why I am kicking myself now is because minutes, that’s right, literally minutes after I sold it, the shared price jumped up 12%. I kid you not, look it up on Google finance. It went up from $7.66 to $8.85 in the span of a few hours. The 100 shares I sold and lost $40 from could have been a profit of $85. Again, this is just one example of my impatience causing me to lose money. I could have also made $500+ on Baidu (ADR:BIDU) had I held onto it until now. I actually am quite an astute stock picker, but the only reason I haven’t made hundreds of dollars yet is because of my bad timing and lack of patience.
So my lesson for the day is learned: Patience can be very rewarding, especially when it comes to the stock market.