Crypto, Stocks and Casinos – Rules of Gambling and Investing
I notice a hush around Crypto lately and that’s because it isn’t going up anymore in general…maybe even going down a little.
So did you sell and make huge profits, are you looking at your investments and wondering what to do?
I learned some recent information about gambling from my husband’s cousin Donna, who is staying with us as she enjoys a vacation here in Hawaii.
I want to share with you the rules of Gambling and Investing!
#1 Go in With a Set Investment / Amount to Gamble
She likes a $200 buy in with bets starting at $1. I invest 15% or so of my income every month.
#2 Keep Money On The Side For a Buy In
If you need more to make at a certain point you always need reserves on the side, so you can buy in again.
I now keep some money in cash in case the stock I want takes a nose dive and I can buy it on the cheap, and also for other great deals that pop up.
#3 Get Out When Your Luck Is Not Going Your Way
If she is at a poker table and it’s just not going her way, she will leave and get a drink. When she goes back, her luck will be different. If it’s good, she’ll ride it until it’s not, and get out immediately.
In investing, I am not the greatest at this, but you need to cut your losers. When an investment that you thought would give you a return doesn’t, you sell it and move on.
#4 Make Your Winnings and Play With Free Money
My cousin takes a chip and puts it in her pocket every winning hand, to make sure she collects what she put in. Then she’s playing with her winnings and is guaranteed not to lose anything.
In investing I’ve learned a formula to take out our original investment when the investment soars, so that I’m taking a free ride.
#5 Keep It Fun – Don’t Take It Too Seriously
My cousin says when she goes to play poker with the goal of making $100/hour, and she’s serious about it, she plays terrible. She will then get a drink, and then she will play better.
In investing, only invest what you can afford to lose. I was taught that if you are constantly worried or looking at your investing, then you are over invested. Invest less until you can sleep at night. If it’s not enjoyable don’t do it.
#6 Gamblers Only Talk About Their Winnings
If you hear a gambler talk it’s because they just won. If they are losing you won’t hear from them.
In investing, I’ve noticed the people who mortgage or sell their homes and use their equity to buy crypto or crypto mining machines, or whatever the hot new investment is…will talk a lot when they make their move. Then after a while and I don’t hear from them when I call, text or send them a Christmas Card…they probably lost the money or are not doing well.
#7 Understand Who You Are Playing / Investing With
My cousin said that she used to love playing on the border with the drunk teenagers from the United States. They gambled their money away and it was easy pickings.
In investing, IPOs are similar, where people open up a company and the insiders make the money before the IPO is offered. They make it from the newbies who don’t understand that buying IPO offerings is hardly ever profitable.
In a bubble, Warren Buffet and Charlie Munger might not invest for years, waiting for the new investors money to run out, and the bubble to pop.