day trading

10 Ways to Lose Money In the Stock Market

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Burning a $100 billIf you wanted to lose money in the stock market, how would you do it?

This is a challenge, as the S&P returned 5.3% per year over the past 15 years (yes, even counting the dreaded 2008).

While it seems nearly impossible to lose money, a lot of work has been put into giving you ways to reliably lose money (although I’d plead with you not to use any of them).

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Crystal Balls, Goat Entrails, and Day Trading Smarts

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hands over a crystal ball

I met a hardworking guy who sees day trading as his ticket out of poverty.  “Sometimes I make $500 a night!”.  It made me want to weep, scream, howl, and laugh.  Out of all the wretchedly bad ideas on how to misuse the amazing stock market, this one is one of the most unkillable, despite innumerable studies demonstrating, “no, you really don’t know the future”.  Ironically, Jill Schlesinger had just written about the disastrous effects of market timing (getting 4.66% return instead of 9.85%).  Rick Ferri also has a good post on this.

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