Friendly Reminder: Don't get upset if someone posts screenshots of how they gained 500%, 1000%, 8000%, or whatever in 1 year.

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by Trivirus

It is understandably frustrating when you’re sitting on modest gains while know-nothings brag about how they turned a couple hundred into a couple thousand over a few months, but let me assure you: those cases are extraordinarily rare, and the other 95 out of 100 people will probably have lost money that way (30 will probably lose most of their initial capital).
Remember that as an investor, you have 2 goals: preservation of capital (money required to stay in “the game”), and steady gains.
This means that you are REQUIRED to diversify, and do your DD on whether the stock’s growth prospects/fundamentals are sound.
Sure, you can throw a few bucks here and there into weed or meme stocks, but a lot of it simply boils down to sheer dumb luck.
Did anyone foresee Veritone, an extremely speculative “AI” stock, would shoot from $20 to almost $70?
Did anyone foresee garbage stocks like Twitter (loss-making) would gain 45% in 2017?
Did anyone foresee Canopy Growth would shoot from its properly valued $9 to almost $30?
No, almost nobody did. It was pure “luck” and FOMO.
Anyway, to avoid dealing with instances like these (esp. on the Internet where anyone can lie or even photoshop their portfolio’s “performance”), I simply do the following:
1) Ask what investing philosophy that person uses
2) Prove that their previous calls/advice on what to buy have managed to beat the market in the past (a method called “Backtesting”)
If they cannot satisfy these 2 criteria, the person is probably lying/hoping to “get lucky.” Don’t bother with these people, you might as well consult an ouija board or throw darts at a financial newspaper.

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