Investing in Value

I got my start making “real money” at 19. I had discovered the world of arbitrage and applied it to the web, buying low-cost traffic through Google AdWords and directing it to sites displaying higher value ads via Google AdSense, then profiting on the difference. For a few months, I was rolling it in.

It started to bug me, though. I didn’t feel like I was creating real value. Folks would visit my sites, looking for solutions to their problems, only to then be directed to other sites that may or may not help. I was just a middleman, profiting on the difference.

Not too long after, I got out, walking away from what was at the time a fantastic income, and feeling no regrets. I ended up taking the most popular “niche” I’d discovered (getting rid of mold) and launched a blog focused on the topic, where I was able to provide real value.

New Opportunities

Fast forward to yesterday. Earlier in the week, a new friend of mine who day trades as a hobby gave me a heads up about Robinhood’s pending IPO. My prior experience in day trading was limited, at best.

We talked about it, I did some light research (including reading their S-1), and hypothesized that it would be reasonable for Robinhood to IPO and see a gain of 20%+.

I placed a bet, planning to “flip” once it hit 20%.

Mental Fitness

One of my favorite books of the past year has been Shirzad Chamine’s Positive Inteligence, which focuses on developing mental fitness. A key aspect of developing mental fitness is not letting your saboteurs (which trigger feelings of fear, worry, anxiety, etc) run the show.

That’s what I want. Feelings will come and go and they’re helpful, bringing risks and opportunities to my conscious attention. What I want, though, is live from a place of positive response, choosing curiosity, empathy, focus, etc., to respond to the opportunities that live sends my way.

The past 24 hours gave me a front row seat to a wide range of different emotions. I was excited, nervous, unsure, sure, then unsure again, curious, empathetic, uncertain, and on. I also had a hard time falling asleep and woke up early.

Lessons Relearned

Robinhood IPO’d this morning and didn’t make 20%. I sat there for a minute or two, watching the price jump up and down, feeling an accelerated dose of emotions.

I sold my stock, accepted the loss, and walked away.

What I love about the experience is the reminder that that’s not the kind of investing I do. I want to create value and be rewarded for that value.

I respect the folks who put in the time and effort to figure out the day trading game and I recognize that there is potential for value to be created in the process. It’s not the value for me, though.

I want to invest my efforts and energy into opportunities where all that I bring to the table can influence the outcome of my investment and increase the likelihood of significant value being created, for all involved.

All told, my experience with Robinhood was an inexpensive reminder. Now on to better investments.