The Fastest Way to Lose All of Your Money With Stock Picking

@tired_momma has recently published an ingenious article on how to lose your hard-earned cash with crypto trading. Her article is linked below and definitely worth a read. It inspired me to write an article of my own. In this article I will complete the topic of losing money by giving you tips on how to stock pick for a total loss. 😜

As @tired_momma did, I also tested all my advice before publishing it. 🙈 It's always important that we become experts in what we write about. After all, we want our readers to stay just as poor as we are. 😉

Stock selection

Go to any stock monitoring website and look for the stocks in the red. These stocks are on sale. The more red, the hotter the fire sale. Shortlist the stocks, because they are cheaper than they were yesterday. Are there reasons for that? Probably not... The other investors probably just want you to have a great deal. So don't worry about that.

Buy low, sell high

We don't want to pay too much for our stocks which are on sale. That's why we should additionally look at the fundamentals.

After all, the lower we buy, the more profit we make if we sell high.

Fundamentals

If the book value is higher than the market capitalization, we definitely have a bargain at our hands. The other investors are just too stupid to look at this number. That's why we get this bargain and others don't take advantage of it.

Again, there are probably no problems with the company that could possibly explain the evaluation. The cheaper the fundamentals are, the better for us.

Dividend rate

Alternatively to the above metric, we can just look at the dividend rate. Just buy the stock which has the highest dividend rate. The company will probably continue paying the dividend forever -- no matter what happens.

Why are the dividends so high? Probably because other investors are too stupid to look at that number, too.

Time in the market beats timing the market

You have heard it before: The longer your money is in the stock market, the better. Don't wait for a correction. Don't look at any charts. Trendlines? Who needs those anyways? After all, we're not trying to follow any trends, we're trying to get the stock as cheap as possible. Don't look at indicators, either. And don't pay attention to news. Don't try to choose good companies with solid balance sheets. Just take your lifetime savings and put them in the first best stocks which appear cheap.

Diversification

You have heard that you should diversify your portfolio. So don't just buy the stocks themselves, add some call options on the same stocks, too. Choose different expiration dates for your call options to increase the diversification.

There you go, diversification done.

Dollar cost average

After we bought our lump sum investment with all the money we have saved up, our picked stocks may go down further.

Dollar cost averaging means we buy multiple times when the stock becomes cheaper after we bought the first time. Whenever it gets cheaper, we buy more of it. Are there reasons for the stock price to continue its decline? Don't overcomplicate things by asking so many questions. Just keep dollar cost averaging.

Buy the dip

You heard it frequently before: Buy the dip.

Is the company possibly going bankrupt?

- It doesn't matter. The stock dips, so buy it!

Buy the dip of the dip

What if the dip dips again?

- Just buy more.

Buy the dip of the dip of the dip

So the dipped dip dips again?

- No problem. We buy it again.

Money management

As we started with a lump sum investment of all our savings, you might wonder how we can buy more?

- Money management is the key.

Get as many credit cards as possible and max them out. Maybe you can sell things you don't need, too. Not having a car is more eco friendly. Drinking water is more healthy than drinking soda and most people eat too much anyway.

And who uses more than one plate and one cup at the same? A knife can easily do the job of a fork, so sell them, too. One spoon should also suffice. And when was the last time you mortgaged your house?

Hodl

Hodl means "Hold On for Dear Life" or it is just a typo of "hold" -- that depends on who you ask. But hodl means: Always hold your assets. Never sell.

The company reduced its dividend?

- Just hodl.

There are allegations of balance sheet fraud?

- Keep hodling

The company declared bankruptcy?

- You know what to do: Hodl.

Congratulations

You mastered the course on how to lose more money than you own with stock picking. 👍

My qualification and experience

I have lost quite a lot of money with stocks by buying bargains. Bargains that were bargains for very good reasons and became cheaper and cheaper until the stocks were worthless and my broker was so kind to discard them for me...

Buy once with too much money, keep adding to the position the cheaper the stock becomes, hodl until bankrupt and then still don't sell... That's a proven way to lose all of your money.

Thank you for reading.

Make sure to visit @tired_momma's article on how to lose money with crypto trading. She has some great advice ready for you as well.

If you want to lose all of your money, you should definitely not join our #Club1BCH where each member tries to accumulate and hodl at least 1 BCH. That would not help you to achieve your goal of losing your life savings.

Disclaimer

Obviously, this is not financial or investing advice. It is written for entertainment purposes only.

I want to highlight how sound investment advice can be misunderstood and can lead to very negative results.

Personally, I fell victim to that myself in the beginning of my investment "career" -- which is actually more of a hobby than anything -- and these were very, very costly lessons to learn. Despite having made lots of good decisions afterwards, I'm still in the red overall after spending more than two years with stock picking and opportunistic trading, because I made these costly mistakes early on.

So, learn from my mistakes, instead of having to pay for your own.