sport football: This Mistake Cost Me Nearly $1 Billion – Don’t Let It Cost You Financial Freedom

July 29, 2024 | Read Online

This Mistake Cost Me Nearly $1 Billion – Don't Let It Cost You Financial Freedom

Getting wealthy is a strange journey…

It's almost as if the universe wants to see if you're worthy. Because it will continue to throw obstacles in your path to blow up your future wealth.

I had to overcome those obstacles in the 1990s and 2000s when I made the two worst financial decisions of my life. Because of them, I left nearly $1 billion on the table.

If it weren't for these two terrible decisions, I'd likely be ranked among Forbes' list of the wealthiest people in the world. (More on that below.)

But I let the opportunities slip through my fingers… And I've been kicking myself in the behind ever since.

In 1991, I was a young and inexperienced investor. But I knew computer stocks were the future. So I took positions in Microsoft and Oracle.

I had bought these names in 1991 when they traded for the split equivalent of pennies.

But boy, did I sell way too early…

Three years later, the Federal Reserve doubled its key interest rate. When the Fed raises rates, high-growth stocks like tech fall in price.

Tech stocks measured by the Nasdaq Composite Index dropped roughly 14%. Microsoft and Oracle fell as much as 28% and 30%, respectively, during this time period.

Despite my research telling me to hold on to these stocks, I did what young and inexperienced investors do: I panicked and sold Microsoft and Oracle at the lows.

That decision to sell Microsoft and Oracle early has haunted me for nearly 30 years. Had I just held on I would've made well over $20 million before the age of 30.

I then made another mistake that ended up costing me over $700 million.

In 2003, I went long on Apple, betting on the widespread adoption of the iPod. But the process of actually making money from Apple stock wasn't easy…

Right after I bought Apple that year, Steve Jobs came out and canceled 55 million stock options, sparking fears that the company's founder was dumping shares.

Apple shares tanked. But this time, I held on and rode out the storm. I was proud of myself…

But the mistake I made this time around was selling far, far too early after shares rebounded.

On a split-adjusted basis, Apple was trading at just 25 cents per share in 2003.

At its recent peak, I would have made $939 million for every $1 million I had invested in the stock.

If I had stuck to my convictions back in the 1990s, today I'd likely rank alongside BlackRock CEO Larry Fink, NBA superstars Michael Jordan and LeBron James, and golf legend Tiger Woods on the Forbes' richest people in the world list.

These men have an estimated net worth between $1 billion and $2 billion. I imagine I'd be somewhere in that range if I had known back then what I know now.

This financial mistake has caused me more heartache, regret, and self-flagellation than any other financial decision I've ever made. That includes bad decisions I made in 1998 that compelled me to file for personal bankruptcy.

The bankruptcy was less traumatic than leaving nearly $1 billion on the table.

I did more to sabotage my wealth than any enemy could have ever done… And I take complete responsibility for that.

I'm telling you these stories because I don't want you to make the same mistake I did.

Buy Great Assets and Hold Them

Virtually anyone can create wealth if they follow a simple set of fundamental rules. And when you follow them, wealth will automatically follow you.

One of those rules is: Buy great assets and hold them.

That's it. You don't have to be a rocket scientist to do that. But there is a price to pay – and it's an emotional one.

I've always told you volatility is the price you pay for life-changing gains in crypto. If you're not prepared for it, it can shake you out of your position too early.

Within these volatile times, some of your assets will go nowhere. They'll trade sideways for months. You'll get incredibly frustrated… And then finally give up and sell them.

I call this "boredom." It's an aspect of investing that other newsletter editors rarely discuss.

You can see what I'm referring to in the chart below.

Despite all the volatility this year, BTC has traded in a tight channel between $57,000 and $72,000 over the past five months.

Similar to volatility, boredom can shake even the savviest of investors out of their positions.

But selling when you're bored is just as dangerous as selling when you're panicked. It's a surefire way to destroy capital.

You can see that in my next example.

Prices Never Take a Straight Line to the Top

Imagine it's 2010. Someone recommends you buy a certain asset at $7. And they tell you this:

Look, sometime within the next 10 years or so, you'll make about 150x your money on this asset… And turn $1,000 into $150,000. Now, I can't tell you exactly when it'll happen.

But what I can tell you is… During this process of owning this asset, you'll lose 50% of your investment on paper multiple times. I can't tell you how many times it will happen… But I guarantee it will happen.

Oh, and you'll go through periods in which this asset does nothing for three years. It's going to look like it's asleep at the wheel. But if you hold it over that period, you'll make 150x your money.

You're probably thinking I'm talking about bitcoin. But I'm actually talking about electric vehicle maker Tesla (TSLA).

Tesla went public with a market cap of $2.2 billion, Since then, its market cap has risen to as high as $1.2 trillion. And its stock price has been as high as a split-adjusted $1,229.

If you bought on IPO day, that's a gain of 32,242%… enough to turn every $1,000 into $323,421. That's a staggering run. But it wasn't easy getting there.

Take a look at this chart of Tesla from 2010–2012.

Imagine you bought Tesla at $2.35 split-adjusted in November 2010 (the first red arrow in the chart above). It's now November 2012, and it's still $2.35 split-adjusted (the second red arrow). You've moved nowhere in two years. That's incredibly frustrating.

Tesla basically traded between $1 and $2.70 for three years. For that period, it was just a boring stock.

I'm willing to bet a lot of investors who got into Tesla's IPO called it quits during that span. They just got too bored with the stock.

But even if you held the stock through those boring times, you wouldn't be out of the woods yet.

Look at this Tesla chart from 2013–2016. We see a huge move higher. But then it goes through years of sideways action.

The stock ran as high as $19 and dropped as low as $9.58. You'd have had to deal with those ups and downs for years before Tesla finally broke out.

In 2019, I actually recommended Tesla to a group of high-net worth individuals at a conference in Carlsbad, California.

It was trading around a split-adjusted $13.33 per share.

From there, it went up 30x over the following two years… But there were several volatile periods that you had to hold through.

It eventually hit an all-time high of $414 in November 2021.

All that sideways action… All the volatility… All those massive drops… When you pull back the camera, they're now just blips on the radar.

Even with its most recent pullback, Tesla trades at a split-adjusted cost of $220. If you held for the past 10 years, you'd be up nearly 150x.

Don't Let Boredom Be Your Enemy

In Digital Asset Daily, my goal isn't just to alert you to incredible life-changing financial opportunities. I will also help guide you through the journey.

That's what separates me from the vast majority of newsletter editors. I'm not just here to give you the next big idea. Because let's be honest with ourselves, most folks don't hold long enough to realize the life-changing gains that come from really big ideas.

That's why it's imperative you understand that right now, your biggest enemy is boredom. Your job is a simple one. Sit tight. Don't force anything.

The world is bending to us.

After 15 years of being called kooks for believing in crypto, the world is JUST starting to embrace this asset class. I believe the profits from here will be mind-melting.

Our job is to buy great assets and just let time do the heavy lifting.

This year my job is twofold: One, get you positioned for the next leg of this crypto bull market. And two, is to not let you succumb to boredom.

Strap in friends because the up moves from here are going to be wild.

Let the Game Come to You!

Big T