Playing chicken in the stock market

Just like any other market of buyers and sellers, the stock market has winners and losers. The winners are the people who get the best price for their product. The losers are the people who get the shorter end of the stick. In the case with the stock market, timing has something to do with how well you do.

If you were lucky enough to buy Apple when it was $50 per share, or Bitcoin as late as sometime last year, you would have made a killing in the stock market. Timing is everything. Luck has something to do with it also, but sometimes you have to make your own luck. Just like gambling, you have to play the hot streaks. The stock market is on an amazing streak right now, so be thankful if you are already making significant gains. However, when the streak ends, it is time to step away from the table.

Consider what would happen to your portfolio if there was a 50% drop in the Dow. Now is the time to be thinking about the protective measures you would put in place, if you had that foreboding the streak was coming to an end. You don't want to be that "greater fool" that buys Bitcoin when it hits $20,000 per share, only to find out later that it peaked at $20,100. Be very careful with your investments, and remember Rule #1 - "don't lose money."