A little backstory first; I've always had an extremely addictive personality. Any time I found something I liked/enjoyed, I would spend countless hours and hours doing it, whether it's watching a TV show/series, playing a video game, playing basketball, studying an artist, etc. And I've always been into money management, although I didn't think of it like that back then.
When I was about 7 years old, I remember going to Steve's Pizza to play arcade games with friends, maybe for somebody's birthday party. But the problem was, the parents would only give the kids a small amount of quarters to play the game, which only amounted to playing the racing car game 2-3 times. I didn't feel like that was enough, and I really liked those games, so I started saving quarters. I kept a little hidden bag in the corner of my room, labeled "Steve's Pizza Quarters" and I ended up having what seemed like an infinite supply of quarters after a few months of saving whatever spare change I could find. Every quarter in my eyes was another way to score another shot at the racing game! Seems so stupid now...I could have saved those quarters and opened up a trading account instead!
I used to collect Pokemon cards when I was young. Man was I addicted to that! I loved playing Gameboy Color and learning all the Pokemon, trying to get the best Pokemon and level them up, etc etc etc... But after several years, I grew out of that phase (hey, I was 10 now, too mature for those!) So instead of letting them sit in a corner like most kids and rot for the next 20 years, I decided that I could try to re-sell them and make money. So, I took printer paper, measured the length and width of paper I needed to properly wrap a group of 10-20 cards in a homemade package for re-sale, and spent hours and hours doing this until all my cards were now in neat packages. Who could I sell them to? I had trouble finding a customer who wanted these because I didn't know how to use eBay back then. Then suddenly, my Mom told me my Grandma wanted to buy them! Great!!! I sold them to my Grandma for a little more than $200, and now I was a rich 10 year old. Not sure how many kids my age had $200 lying around, but that was great! (Of course, many years later I found my Pokemon cards in the back of a closet, and came to the realization that my Grandma didn't really want to buy my cards, and my "Grandma" was really just my Mom helping me out.)
After this I started seeing the fun in collecting/saving money. I didn't really need it for anything, although I would imagine the things I could buy with it. But I never did spend it on big purchases, because I knew in the long run it wouldn't be worth it. I imagined myself 5 years older, a whopping 15-years old, knowing that at that age I was bound to know of an intelligent thing to do with this much money.
Around 7th/8th grade, the big thing among my friend group was to buy a ton of greasy chocolate chip cookies for $1 each, and chocolate milk for $.50 each from the cafeteria, and eat as many as you could during lunch. But I couldn't ask my parents for $10 for lunch just so I could buy 8 cookies and 4 chocolate milks for a healthy lunch. That was irresponsible and I would feel guilty even asking. So I devised a plan to make my own money at school to pay for it. At Costco, "5 Gum" was being sold in bulk, and doing the math I found they were basically being sold for $1 per package. So, I bought a ton of those, and re-sold them to fellow students for $1.50 per package. This worked for a while, but pretty soon all my friends and peers already had gum that I sold to them 2 weeks ago, and they hadn't finished the package yet so why buy more? So the plan worked...kind of.
Next, I started playing an online MMORPG (or whatever its called). I was full-on addicted with my friends. Insane amounts of time we spent on that game, in the end it helped me make money so it wasn't like I was wasting my life entirely on this game. I started scheming up ways to make a ton of money in this game. The fastest way to make a ton of money was by scamming people! Just like Wall Street I guess. So I found many ways to do this with my friends (we were ruthless I tell you!) and I ended up making a shit-load of virtual money. But wait...how can I make real money off this? Lots of my friends at school played this game too, so I would sell them the virtual money for real money. And it was awesome, I made several hundred dollars over the span of a few months.
I continued to play this game on and off over the next few years, as did my friends. One of my friends used to come over to hang out all the time and we would play ping pong and pool/billiards and video games. But not just for fun, we would place bets, betting certain amounts of money in the virtual game I mentioned above. It was really fun for me, and that was my first experience being on somewhat of an equal playing field trying to make money (instead of being a salesmen with a product, selling to somebody else with limited to no risk of losing my own money). It was close to 50/50 chances, because we were both fairly good. That gave me an adrenaline rush every time we played, especially as it got closer to the end of the match and the scores were close. But that was just virtual money.
Another friend of ours who lived right down the street had a nice pool/billiards table, so we would go over there and play often. But it got boring just playing for fun, so what could we do to make it more interesting? Oh yeah...we could bet real money. We started off small, betting $50 at a time; sometimes just one game and other times best of 3. It went back and forth and nobody really lost or gained any money for several rounds. Then I played another friend of mine, and it was a close game until the end and I finally knocked the 8-ball in. I made $50, cool. But my friend had a desire to win, I could see it in his eyes. He offered to play again for double-or-nothing, so I said sure why not? Then...I won. $100, not bad! He continued to offer me double-or-nothing until he owed me $800 and his Apple laptop. I felt really good, of course, $800+ in one day while being in high-school isn't bad. I didn't need him to give me his laptop (I wasn't that much of a dick), but he did pay me all the cash he had on him which was around $267 if I remember correctly. In the end I didn't make him pay me the rest, I figured that was enough. So my addiction to gambling/betting/collecting money started sprouting.
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Long story for you to read maybe, but its the first time I've put this down on paper/typed it out. The point is, I've been into making money for a while. Not really to spend it on extravagant things, but just because it's fun to have goals (to make $10 to buy a bunch of cookies and chocolate milk, or make a few extra hundred dollars on a video game to save up for something I might want when I'm older). Scalping 5 Gum to other kids or making money off a video game's virtual money isn't the typical job teenagers have, I came up with original ways to make money because I didn't feel like working at a fast food place. It was extremely fun and challenging for me to come up with ways to make money, but it wasn't WORK at all, because I loved it. I got a rush whenever I came up with a new idea to make some extra money, in ways that the typical person usually can't. Hmmm...
My senior year of high school I had to take an Economics class. We had to play a virtual stock market game on MarketWatch.com, and there wasn't really any prize for 1st place. But it was another good challenge for me, and I got addicted to it quickly. I had a few friends who were into it like I was, and of course most of the class just bought AAPL and INTC and NFLX and held them the whole semester. But I knew that wouldn't make the most money, so I tried coming up with strategies with friends that would be the best.
One kid named Caleb started shooting up in the leaderboards. He ended up explaining to me his strategy, which was going to Yahoo Finance Top % Gainers right at market open, and seeing which stock was up the most. He said usually stocks above 50% are the best, and he would just short sell the stock a little after market open, and his results were amazing. He would just hold on for a day or two and the stock would fade right back down. His first HUGE winner was shorting HMNY, I remember this ticker for some odd reason. I just looked at the chart from that day, and WOW what a friggin trade. HERE's the daily chart, he shorted the spike mid March 2012.
This is the first time I've typed this out, and it's eerily similar to my strategy that works best for me now. Obviously his strategy was very primitive compared to what I now look for to short, but the concept is the same. Look for stocks up a huge %, see if the move is warranted at all, and if not, short it for a huge fade.
I ended up using this strategy myself and beating Caleb at his own game, getting first place in the game. Maybe this could correlate to the real stock market...
I then started to talk to my parents about trading with real money; I tried to prove to them my strategy worked. I wrote down on a piece of paper a ticker I would short, and gave it to my Dad before I went to school. Then I would come back home from school and check the results. Several days in a row it worked, and he was surprised. Then I remember I wrote down DEER one morning, and came back the next day and it actually went higher. That was the first time it happened, I was really surprised it didn't work for some reason.
But even though there was one outlier, my Dad believed in my strategy enough to give me $2,500 to try out. He opened an account with Fidelity and funded it for me, and I started off on my journey. Definitely a rough journey to begin with...
Read the Part 2 of my story HERE
Read the Part 2 of my story HERE
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