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What Is The Most Frustrating Thing About Learning To Invest?

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Lionel Yeo

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My Accounting 101 professor back in college had ginormous biceps. He’d flex them menacingly as he paced Huntsman Hall, and the fear of getting our heads crushed between his guns stopped my buddies and I from falling asleep during lectures. But even though I managed to stay awake most of the time, I still pretty much sucked at accounting.

I just couldn’t get it right. LIFO, FIFO, depreciation.. these terms flew over my head as if I was learning a foreign language. I could never get my balance sheet to balance. (I did get pretty close once though – I was off by about $10, so I stapled ten bucks to my assignment and submitted it. My tutor returned my money with the note “Very funny, Lionel”.) I signed up for Accounting because I thought that it might be “useful in the future”. I understood the concepts theoretically, but whenever I had to apply it to a “real world” context, I ended up more confused than ever.

Have you ever tried to learn something, but hit so many barriers that you sometimes stopped and wondered, “Why the hell am I torturing myself like this?”

I feel like most people might feel that way about investing.

 

Failed Approach #1: Learning Technical Analysis From Books

“How do I start learning investing as a beginner?” is one of the most common questions I get from members of my VIP List.

I can totally empathise. When I first started learning investing, I was completely overwhelmed by the number of books, courses, strategies there were out there. As a young, clueless 18 year-old, I’d head to Kinokuniya and just stare dumbfoundedly at the shelves and shelves of investing books, wondering which one I should start with.

I’d pick a random book, and get immediately bored by the pages droning on about some technical, obscure detail that no one cares about. I did want to get rich though, so I forced myself to learn the technical analysis strategies that I came across. I eventually got good enough to program them into this expensive software I bought, and started trading those strategies against cold, hard data.

And you know what I found? That none of the strategies I read about worked over the long term. Something just didn’t add up.

 

Failed Approach #2: Trading Seminars

After a few years of failed testing, I figured that there was probably something the books weren’t telling me. So I started searching for investing and trading seminars instead. This turned out to be an even worse idea.

I remember attending like a dozen of those “Get Rich Making Big Money Investing In Forex/Stocks/Gold” seminars. They were almost always run by a guy in a suit with terribly-designed PowerPoint slides. He’d spend 80% of the lecture giving dumb, generic tips like “Before you start investing ah, you must know your risk profile. Know your what?” Then the audience (mostly made up of uncles and aunties) would chant in response, “Risk profile!!”

It felt like I was in kindergarten all over again.

None of these approaches worked for me. Technical analysis books were interesting, but their strategies didn’t stand up to the data. Investing seminars might help to rah-rah the crowd, but they lowered my IQ by 20 points every time I attended one. There had to be a better way.

 

What Frustrates You?

Since then, I’ve been fortunate enough to read a few good books on solid investing principles (you can find some of them in my Reads section). I also spent years researching, which led to the index investing strategy that I practice today.

I know that as a beginner, it can be overwhelming to try to figure out where to start. Even as an “experienced” investor, it can get frustrating to try out multiple, failed approaches. I know, because I went through that very same path myself!

No one should have to go through all that frustration when learning something as essential as investing. That’s why I’m thinking of creating a free guide to help point beginner investors in the right direction. I want to make it simple, no B.S, and in a language that talks to you like a real person – not a Finance professor or a primary school teacher.

But before I do, I’m curious if you could share your number one frustration when it comes to learning investing.

Is it trying to overcome an overwhelming sense of boredom while you’re reading an investing book? Is it figuring out whether someone’s trying to scam you? What have you tried as you were learning investing, and why didn’t it work out for you?

Be specific – I want to hear the details, and I’m curious to hear everything you have to say. Leave me a reply in the comments below, or send me an email. I read every one.

Image credit: UGL_UIUC

 

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Lionel Yeo

I’m a ramen slurper, bathroom dancer, and financial hacker behind cheerfulegg.com – a personal finance blog for college graduates and young professionals. I focus on fresh, simple, and honest personal finance strategies, which have been featured on the Sunday Times and Wordpress’ Freshly Pressed section.