In case the title was not clear, this is a case study of WHAT NOT TO DO.
Back in January 2021, I decided to heed all the wise investment advice I knew to be true.
How It Started – GME To The Moon
Financial FOMO made me feel like I was missing out so against my own interests, I decided to buy GME. At the time GME (Gamestop) was trading at $280 per share.
My only saving grace is that I only bought two shares. However, this was also the exact amount of money I needed for my half of my b-day trip fund.
I bought my shares the night before GME started trending in the news. Due to all the hype, I saw my share price actually rise to $300, $325, etc.
Did I sell and take my profits? No.
I was stoked on by a subreddit that shall not be named. For example, I foolishly thought that the stock price would keep getting higher. I even shared this message below in a family group chat.
I am so thankful that none of them actually bought this stock because things went downhill fast.
It is a long story so I won’t relay it here. However, this podcast episode from SoMoney does a great summary of what actually happened with GME.
The Messy Middle – GME Tanks
GME literally ended the trading day at $90 that night. Overnight, my talks of getting $500 a share seemed like a pipe dream.
I watched the share price go lower and lower. At the lowest point, I believe GME was trading for around $40. Yikes.
However, if I did not sell at a lost of $20 a share, there was no way in hell I was going to sell at the (potential) bottom. Turning paper losses into an actual dip of my portfolio seemed like a sucker move to make. Although it would also be fair to point out that I had already made several sucker moves at this point.
A Surprise Ending – Memes Gonna Meme
On March 10th, the unthinkable happened. All of a sudden, GME began to rise again.
My initial reaction was: who the hell is buying this stock?!
I immediately pulled up the NYSE website to monitor the changes. My initial goal was to just get my f**king money back.
Atlas, GREED is a hell of a drug.
Lo and behold, GME was actually going to the moon. Did I sell once my stock had rebounded and went over $280?! Nope.
Instead, I saw the stock go to $340 and immediately sent a text to my boyfriend. The message stated that we would be eating at our favorite restaurant later that night, special treat on me. I also told him I was waiting for it to hit $350 before I sold.
In other words, I was still being led by delusion and greed.
Unfortunately for me, I got distracted texting a friend. When I went back to check the stock 15 minutes later…
GME was trading at $220 per share.
I was LIVID.
Specifically, I had been a dumbass once again.
I spent a good chunk of my lunch hour refreshing the screen, willing the stock price to go back up. I promised myself that if I saw GME get within $5 of my original purchase price, I would sell.
Luckily for me, GME was starting to go back up. After watching the screen obsessively to see when to sell it, I finally dumped my shares at $275.
Lessons Learned From Buying GME
I never want to hear GME again.
FOMO can make you do things against your better judgement.
Choose an investment plan and stick with it.
Did you get caught up in the GME craze? Let me know your story down below.
That’s so interesting, I had a similar experience with Doge coin and I actually sold my shares before I went to bed the night that reddit and Twitter started hyping the stock. I was so close to keeping the stock and im glad i didn’t because when i woke up the next morning it was trading below what i bought it at and has continued to go lower LOL. This was an entertaining post.
From Reddit and Twitter, one would think the stock was going straight to $1. I also sold and I’m very happy I did. I occasionally go back to take a look at the price and it’s still sitting lower than where I sold.
Lol, I am glad you dumped Doge Coin Rebekah! It is so interesting what FOMO will make us do! I am staying far far far away from meme stocks in the future.
I made a similar mistake when a certain black owned bank was being hyped up. Greed can really cloud ones judgement because I definitely knew better.
Lesson learned for both of us. Investing in stocks like that is the equivalent of going to the casino to play blackjack 😂
Okay now I am curious as to which bank it was and if they are also here in the US (I will message you privately)! Yeah, honestly stocks is like putting all your eggs in one basket. That is why I much prefer index funds. I still do have stocks in a few companies, but it is not a majority of my portfolio. In fact it is only around 3%