This week, I’ve seen the best of the market crash from the sidelines and then, after the market is in free fall, there’s the worst.
And there are times when you need to step in and pick up the pieces of your broken market, because it is simply too good to be true.
You just have to go back and re-analyze it.
So I started a newsletter called The Collapse, with a goal of sharing stories and observations about the worst moments of the last few months.
I’ve been lucky enough to get my hands on a ton of bad stock market stories.
And it’s always a little hard to know what to write about because of the way the media tends to spin it, but one thing I’ve learned is that even if it’s not true, the news has to be published.
So, today, I’ll share with you a couple of stories that have been really inspiring and have been making me realize how valuable this market can be. 1.
How I made $1,500 last week after selling my shares of a company that I didn’t know existed.
The stock went from $1.20 a share to $1 a share in a matter of hours.
What made it so special?
The stock price of the company I owned, called CVR Systems, went from a $1 billion valuation in December to $7 billion valuation by the end of March.
It was only a matter in a month or two of time that my share price had grown to $2.00 a share.
After that, the stock price increased in two weeks from $2 a share and I sold my entire stake.
What happened next was amazing.
By the end, I had a $3.50 profit.
It’s a rare story that I can tell you, because most people don’t realize how lucky they are to have had a stock with such a great future.
But it is amazing that, when the market crashed, people could get out of bed in the morning and get a profit of $3 a share, and still have enough money to buy a house, pay rent, and pay the mortgage.
A company I thought was a big moneymaker ended up being an incredible bust.
I was in the market for a new company, and I ended up buying shares of CVR’s competitors.
I’d read all the stories about how great they were and thought I was going to be a star in the industry.
And then the day of the IPO came around and the stock was at $1 an share.
What were my options?
I’d be out a cool $500 a share if I bought the company and had it go public at the IPO, which would be a big mistake because they were only worth $6 a share at the time.
And so I had to sell my entire CVR stock at the beginning of the week.
I did the math, and my stock would have gone from $5.50 to $4.00 by the time I had the IPO.
So instead of being a star, I was actually a bust.
A stock I thought I knew would have a great long-term future has ended up a disaster.
A few weeks ago, I sold $2,500 worth of shares of another company called Fisker Automotive.
My goal was to sell it for a profit.
I had never done this before, but it was easy enough to do with the money I had in my 401(k) account, so I didn.
My stock price went from an amazing $2 to $3 before I sold.
What did I learn?
The most important lesson of the CVR and Fiskers stories is that they were the exception.
There are lots of companies out there that are going to fail, and you needn’t worry about selling them at a loss.
I can’t tell you how many times I’ve sold my shares, and if I didn, I’d still be making money.
I also learned that you have to keep your options open, and remember that your stock is just as valuable when it’s going up as when it goes down.
A guy bought a business he never thought he would ever sell.
It seems like every day there are more stories like this.
A couple weeks ago I was selling a small auto parts company called Sysco Auto Parts.
I bought shares of the stock, but only when the price was $0.25 a share — when the company had a market cap of $2 billion.
Then I was able to buy shares at $0 and $1 each, and it was a great deal.
I ended the day with a $9,000 profit, and the company went from being worth $100 million to $40 million in the space of a couple months.
What I learned is, keep your option open.
When the market crashes, you