Life Lessons From A Virtual Trading Game: What The Stock Market Taught Me

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About six years ago, I took a course on investments and stock trading which was fun for some parts but really complicated for the rest. However, we had this group activity that became part of our project in a way in which we went on this virtual trading platform and invested money on stocks. My friends and I were quite stressed because we didn't really understand the principles that well, so we lost some money at first, and then later on, one of my friends discovered a means of getting quick profits on short trades, so we ended up winning the virtual trading game.

And here are some of the lessons and insights I learned from that time:

1. Don't get too obsessed on a particular path, be flexible and move on

If you think that you are on the wrong path, no matter how much costs or losses you have incurred, do not prolong the torment. Get out of that sticky situation while you still can and simply try to recover what you have lost by making the right, informed decisions in the future. One needs to have a good feel of the market and ride the wave of momentum brought by the trends that are currently in motion. Always be flexible to whichever direction the wind is going to blow because you never know when the tides will turn.

2. Learn from your mistakes, don't wallow in them

In connection with the previous statement, do not wallow on your past mistakes but instead make the most of what you have right now. No matter how much you have lost, whether it be a thousand or a million, there will always be a chance to redeem what you have lost and gain much more. All you need is patience, determination, nerves of steel, good intuition and calculation, and the ability to let go of the past after learning from them.

3. The past doesn't dictate the future

It doesn't matter how many times you have failed before, all of those times were in the past. Focus on the present and formulate a strategy or an action plan that would be suited to the prevailing conditions and trends within the landscape. Take advantage of the opportunities that may only come along once in a blue moon and always look ahead, set your goals forward, and make decisions based on what you expect in the future.

4. Failure is a part of the learning process

No pain, no gain. No guts, no glory. You need to take risks to get to your desired result. Bill Gates said, "To win big, you sometimes have to take big risks." Same with Richard Nixon, "If you take no risks, you will suffer no defeats. But if you take no risks, you win no victories." 

On the other hand, you shouldn't be reckless and take whatever opportunity has been presented before you. You need to be smart them still. George Patton says, "Take calculated risks. That is quite different from being rash." And finally, Greyson Chance once quipped, "Bigger the risk, bigger the reward. But the higher the climb, the higher the fall." What's life without a bit of flavor, excitement, and a series of mini heart attacks?

5. Patience is the name of the game

Every good thing comes to those who wait. In life, hitting the jackpot is usually a matter of luck, but sometimes luck is a factor of timing. The saying goes, "Luck favors the prepared." Since we don't know when things will happen or when the tides will be on our side, so it's best to be prepared and wait for your turn, for your time to shine. In the meantime, do things that are productive and that would develop the right skills or knowledge to help you grab the opportunity when it comes.

6. Be efficient with your resources

In the short run, you don't need to invest in a lot. Just pick one that you think would make the most impact and put all your resources into it. There's this thing called the Pareto principle which states that "for many outcomes, roughly 80% of consequences come from 20% of causes." That means, you should only focus your time, energy, and effort on the 20% that can make 80% of the impact. That also means that you need to get rid of 80% of the stuff in your life that doesn't contribute to that. Or at the very least, reduce the amount of attention you spend on the other 80%.

7. The only certain thing is uncertainty

Don't get too confident or cocky. Because when you think you got it right, that's when things could start falling apart. The market will always correct itself. Even though we may get large gains now, later on, once the market starts catching up, then the prices will adjust to match the true value of the stocks on the market. Generally, people say that majority of investors or trades cannot beat the market. The market can't be beaten. There are only a few exceptions, and only by some really cunning people.

What you can depend on in life is that things are going to be uncertain. You have to be comfortable with that fact and accept it. This mindset will help you face circumstances, trials, or even tragedies with more or less a level-headed disposition. If you know anything can happen, then nothing should surprise you. Rather, you turn to being enterprising and resilient during those times. As long as you have breath in your lungs, then you can do something about your circumstances.