The first memorable mistake of Mickaël, a 47 -year -old teacher, was “due to poor knowledge of the system”. (Image: 123RF)
Paris – You learn by making mistakes. And in the stock market many beginners who have started in recent years are stumbling in their first steps, with the key to financial failures.
The first memorable mistake of Mickaël, a 47 -year -old teacher, was “due to poor knowledge of the system”.
After a mistake, he found himself with three times too many shares of Orapi, a manufacturer of hygiene products listed on the Paris Stock Exchange. In April 2020, he tried to buy securities just after 5.30 pm, during the “adjustment” period used to record the last transactions before the market closes precisely at 5.35 pm
“The purchase did not come out of my wallet so I clicked a second time to make the purchase again, I think there was a computer error, nothing. I tried again, still nothing. Then at 5:35 pm, everything suddenly happened! ”
He will understand later that this is how this five-minute buffer zone works, at his expense since “tomorrow the title will fall by 40%”, which has cost him a loss of approximately 600 euros.
A better knowledge of the tools can also prevent a Twitter user from losing part of his or her investment in biotech Ose Immuno. He gained “12% in one session”, before accidentally “being hospitalized in the emergency room the same night”: result, when he left the hospital after three days, he lost 28%, which “had no idea what the stop loss. ”which will allow him to automatically sell his shares when the price falls too low.
This type of protection is the “workhorse” of Nicolas Chéron, market strategist for Zonebourse.com who describes himself as an “educator and popularizer” of financial markets through his Twitter account and his videos.
His advice: always have a way in case the situation gets out of control.
Young people are attracted to cryptocurrencies
Perhaps the most dangerous consumer darling is the cryptocurrency market, unpredictable assets that attract many young people, like David who gave up in March 2021.
With no financial background, this 26-year-old parliamentary attaché trained “self-taught” before investing … and lost “500 euros out of a total of 750”. that’s how you learn, ”he explained.
Investment errors can be costly, especially for individuals who believe they have found a nugget, sometimes aided by the wrong advice.
Mickaël surfed a lot on Boursorama and its discussion forums, but “there are a lot of scammer on these forums”, according to him.
Flooded with (often deceptive) videos and advertisements that present surprising benefits, individuals try to maximize their returns, sometimes taking reckless risks.
“New investors tend to want to see the low point of a falling value”, a risky bet, as the price often continues to fall, testifies Nicolas Chéron who receives hundreds of messages from to individual investors every day.
Risks not considered
He found that these traders favor risky investments with very volatile prices. And cited a chart from Bloomberg showing that the panel of consumer favorite stocks has lost more than 30% since the beginning of the year, while a benchmark American index, the S&P 500, has lost 15% in same time. .
Grégory Guermonprez, director of online bank Fortuneo, sparked a tidal wave of new traders who came to Fortuneo two years ago: “the number of our customers in the stock market has jumped 60% since January 2020 “.
According to the French stock market policeman, more than 3 million European individuals were active in the financial markets in the first quarter of 2022, conducting nearly 30 million euros in transactions, triple the number compared to mid -2018.
At Fortuneo, these newcomers are young, 32 years old on average, of which a third is 18-25 years old. 70% of them are men, rather “independent” in their investments, Mr. Guermonprez explains.
The question now arises as to the retention of this new client when the market environment has deteriorated drastically: since the beginning of the year, equities have fallen.