Day Trading And The Stock Market


The Internet stock craze was one of the most amazing events in stock market history. I remember waking up every day at 5 AM in the morning to start my day trading career and I would flip through the many different stocks news websites to see if I could catch any big individual stock company news before it hit the masses when the market opened up 90 minutes later, and I remember once seeing a particular Internet stock have some dramatic news about earnings come out and I quickly jumped into that stock at six dollars a share. 20 minutes later the stock had risen to $12 a share and I pocketed a quick thousand dollars. As you can see back there in the Internet craze we as day traders were very spoiled and we thought that this would be the norm for the next 50 years (in other words we were mentally delusional), but during this time the ones who made and kept their money where the levelheaded day traders who knew how to keep their emotions in check and have a lot of money on the sideline just in case of a rainy stock market day, and sure enough in late 2000 and early 2001 this major event occurred in which almost all speculative Internet stocks crashed and when I say crash I'm talking 50 to 75% off of their current values at that time. This had burst the Internet bubble and made most stock market investors very cautious about their future investments.

Internet stocks were not the only stocks that were going up like crazy during this time. I remember biotech stocks and genome stocks going up like crazy also. For instance, I invested in a biotech stock called SCLN, which had a major immune system treatment. I originally bought the stock at three dollars a share and ended up selling it at $11 a share which was an over 300% return on investment for me even though the stock did go up as high as $25 at one point but again I had that greedy mentality that told me to hold onto the stock because like the other stocks it was going to keep going up and burst through the roof. It did and of course and I learned a great lesson and a lot of experience.

What I'm trying to tell you is always do your research and make your investment based on sound economics and a lot of due diligence. This way you can keep the deadly emotions that ruined most investors out of your investment decisions. I learned the hard way because I lost over a quarter of $1 million during this time. I can only imagine how my life would be right now if I had learned how to keep my emotions in check and listen to the market enough to pull my money out when it was calling for this decision.