This reflection paper recounts a personal journey through early investing failures and the career lessons they produced. The author describes two key missteps: selling Lionsgate Entertainment shares too soon out of impatience, and losing savings in penny-stock pump-and-dump schemes in the marijuana sector due to greed and inexperience. Through these experiences, the author examines the psychological factors—impatience, greed, and overconfidence—that undermine investment decisions. The paper concludes with a description of the formal financial education pursued afterward and the broader life lesson that accepting what the market offers, rather than overreaching, is essential to long-term success.
One significant instance of failure in my career development came during my time as an investor. I had been studying finance and markets for some time, as I had always been interested in how money could be made on the stock market. I was not looking to make millions, but I did want to see if I could earn more on my savings by investing in stocks rather than earning next to nothing from a savings account paying practically zero percent interest. So I began researching the market, looking for something priced cheaply that would likely rise as news came out in the near term.
I purchased shares in Lionsgate Entertainment because the company had produced the hit film franchise The Hunger Games and the acclaimed TV show Mad Men. I figured The Hunger Games would be popular, so I invested in that stock. But because I was new to this arena, I expected the stock to move suddenly and dramatically the moment I purchased shares. I came to realize over time that this is not how the market works — I had a great deal of learning ahead of me.
Eventually I sold my shares in Lionsgate just before the stock began moving up dramatically. I was frustrated with myself for not having the patience to see my investment through over a longer period. I should have trusted my original reasoning, and I did not.
My next investment was in the marijuana sector. I knew that states would be legalizing cannabis, and I found some cheap penny stocks that looked as though they might make big moves to the upside. I invested in them — this was before I understood anything about fundamentals, earnings, outstanding shares versus authorized shares, debt structures, or toxic death spirals.
When marijuana legalization news hit the headlines, these stocks soared. Suddenly, from simply wanting to grow my savings, I felt like someone who had hit the jackpot. I did not know what to do and started imagining the stocks would climb even higher. Instead of selling as I should have, I wanted to hold on and really become wealthy. I had stopped being rational and had become greedy. My father tried to warn me, but I did not listen. The truth is, I had never really been smart about any of it — only lucky. I had identified a trend before others, but I had not been disciplined enough to profit from it properly. There was still a great deal left to learn.
"Losing savings to worthless pump-and-dump stocks"
"Formal education rebuilds knowledge and confidence"
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