When I first started investing in stocks, I was prone to falling in love with my investments. I had high risk investments, placing positions in penny stocks.
And, boy! Did I learn the hard way. While some stocks did go up, many plummeted down to the abyss. I held these positions, hoping that it will go up eventually. Never did. Instead, I lost 70% of the cash I used investing in the position.
So why did I fail? I fell in love with my investments.
Take Dogecoin, for example, which is speculative in nature. You have to have a lot of guts to maintain a position if it does go down. Whales could sell by billions of Doge, forcing the price to plummet.
There is a way around this.
Be prepared to lose all of your cash invested in. If you accept this, you will be mentally prepared to deal with losing money. This is why you should never invest more than you can afford to lose.
Never, never ever borrow money to invest. Buying on margin is the worst thing you can do because if you choose the wrong investment and it plummets down, you will double down, meaning you not only lose the money you borrow, but then also the downward in price. Let's say you borrow 500 dollars to buy and it goes from 5 dollars per coin to 2.50 dollars per coin, you will not only owe 500 dollar, but also lose 250 dollars. Not good.
I have positions in Dogecoin. But, I have already prepared myself for a down turn.
Tokens like Dogecoin are fun and might have a future, but do not fall in love with it. Do not fall in love with any investment. Accept the fact that you could possibly lose all your money invested in. If you are ok with that, knowing full well of the risk, then go on and have fun.
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This post is for entertainment purposes only and solely my opinions. I am not a financial advisor. It should not be mistaken for financial advise. I am solely a former stock investor who decided to take on crypto investing in order to satisfy my hunger for technical analyses. And, in crypto, you do that often.