The Costly Lesson: My Worst Investment Ever and What I Learned From It

Hey, this is James Pelton and I want to talk with you today about my worst investment of all time. Okay. And before we start, I want you to comment down below what you think it is. What do you think is my worst investment of all time? Do you think it's yield notes? Do you think it's drip? Do you think it's something else? You'll be surprised. Maybe it will surprise you. So the reason I want to do this video is two things. First off, I know misery loves company. So I know that all of you watching have probably lost in some investment at some point. And I just want to connect with you over that. I want to commiserate with you. I've heard it said that you people either admire you for your strengths or they will connect with you through your weaknesses. So I could come out here and just post all my wins and just say, Oh, look how good I'm doing and everything. Look how much money I'm making. Or what's probably closer to your experience and mine as well as I can post my losses and we can commiserate and we can say, Hey, look, we've lost together. Let us bond over our losses. Another thing I want to get out of this is I want to show you the lessons that I learned from my losses so that you don't have to learn them. You don't have to lose the money that I lost to learn the same lessons. So again, before we go, I want you to comment what you think my biggest loser is. So option number one, do you think it is yield notes? So I, at one point I had $200,000 in yield notes. They basically have shut down. I consider that money a loss. That's quite a bit of money to lose. I believed in the team quite a bit and I do a lot less. Now we'll say, do you think that's my biggest loss of all time? The answer is no, I don't think that it is. In fact, I actually got into yield notes fairly early and I ended up making more money than I lost in yield notes. I was able to, I had 200 K in there. I was able to sell a hundred K of it for a discount. So I think I actually ended up positive in yield notes. So it is not my worst investment ever. Option number two is drip. Do you think that drip is my worst investment ever? This is the drip chart. I've seen a lot of charts in my day, but this one takes the cake. Okay. This is the worst chart that I have ever seen. I think at one point, my drip faucet was worth probably close to a million dollars and now I think it's worth 10 K. All right, so that's a big loss. So is drip my worst investment ever? And the answer is definitely not. Okay. Because I actually bought in back here in September of 2021, I actually bought in at pretty low prices this whole way up. I was able to pretty much claim. And then I've claimed every single day since all time highs. Okay. I just know when things get up this high, they're not going to stay there very long. So I've claimed every single day. I know the drip community doesn't like that, but compounding is the same as buying at the current price. And there has not been a current price that I like for drip. So anyways, the point is I've made a lot more money on drip than I've lost. So it is not my worst investment. So what is it? What is my worst investment then? Can we get a drum roll here? My worst investment by far has been my Kadena miners. Okay. So I bought two Katie fives and a Katie six. I bought them back when Kadena was at about $20 a coin. I paid for my Katie fives. I paid $50,000 a piece and I bought two of them and now you can get them for about two K. So my a hundred K and Katie five miners has gone down to about two K and at the height, these were making about $200 a day. Now they're making negative $2 a day after electricity. So that's a bummer. Not even sure if I should keep these plugged in. Probably not honestly making negative 70 bucks a month on them and not to make matters worse. So I spent 50 to 50 K on a Katie five. Then I spent another 50 K on another Katie five. Then I spent 60 K and preordered the Katie six. The Katie five is making all this money. The Katie six is going to kill it and it did for about three weeks, but now at my 60 K I paid for a Katie six. You can now get them for four K. So $160,000 put into Kadena miners. That's now worth very little. This one's making me negative 50 cents a day. So yeah, that's a little better. It's a little less negative, but not good investments for me. So again, I hope that makes you feel better. And just so you know, the main reason this has happened is this stupid, I'm going to call it stupid. I don't usually use such harsh language, but this stupid K a three minor, it's 166 Tara hash. Again, my Katie five is 18 Tara hash. So it's about 10 times as much Tara hash. This one uses 3154 Watts. This one uses 2250 Watts. So it's 10 times as much hashing power less than two times as much electricity. So that's a huge bummer. The K a three just made these absolutely worthless. Also the price of Kadena has been way, way down. So all in all, just a bad situation. So again, I want to commiserate with you on that, but I also want to know what lessons can we learn from that? I've been taught that no mistake is actually a mistake. If you learn something from it, I'm not totally sure I believe that 160 K it's like, there's gotta be cheaper lessons than that. But I have boiled this down to four lessons that I think we can learn from this. So first off, I would say, understand what you were investing in before you invest. Okay. I did not understand Kadena. I did not understand mining. I did not understand bear markets. And you're going to invest in something you don't fully understand. Dip your toe in and feel the water. Like what's the temperature in there? Don't go through 160 K into something you don't understand. I didn't understand that mining technology changes quickly. I didn't understand that. Hey, we're in a bull market right now and we're going to get to a bear market where coins only go down for a long time. Didn't understand those things and paid the price. Second lesson that I think we can learn is diversify. Okay. So if you talk to professional traders, they aim for a 60% win rate. That's pretty good for trading, which means that if you're going to get in on 10 projects, you should expect four of them are going to just fail miserably. Like you'd probably lose all your money. Five of them might do fairly well. And then hopefully you have one that's like a unicorn where you make a bunch of money. Okay. That's how I look at my portfolio. So in my looking back, I went in too heavily on the Kadena mining disproportionately to the rest of my portfolio. And it was one of the four losers. Okay. So bad news bears. So diversify don't put 160 K into one project. I should have taken that a hundred, maybe put 20 K into eight different projects, something like that. Lesson number three is do not, it isn't going to sound stupid, but it's still a lesson that we have to learn, but don't buy coins when they are near the all time high price. Okay. So I bought Kadena these miners at about $20 and it'd be fair. It was lower than when I wasn't $24, which is kind of all time high. But the problem is it's near all time high. Okay. So you should be buying when coins are low and selling when they're high. I lesson number four is kind of what this whole video is about, which is don't let your losses, your mistakes, discourage you from the future. Okay. Don't waste your losses. Don't waste the mistakes that you made, but learn from these. Just again, the way that we're wired is we only learn when we lose significantly. Unfortunately, people told me, Hey, watch out for the bear market. I ignored it. I was like, eh, I've never experienced that. It'll be fine. It was not fine. Okay. It was, it was a bear market and I lost a lot of money. So learn from your mistakes and then it's not as much of a loss. And then maybe we'll call this a bonus lesson, but only by I'm from now on, I'm only going to buy miners that are produced by bit main. Okay. Gold shell, they're mining cadena and they're like, Oh yeah, we're doing great. We're doing great. Bit mains like, Hey, we want to get on the cadena action and they just blow the gold shell miners out of the water. And if you look at all the top miners, it main owns cadena mining. It owns Bitcoin mining. It owns light coin mining. It owns doge mining. It owns all the mining. So that's a bonus lesson for me personally. I am only going to be buying bit main machines going forward. In fact, maybe one of the lessons I've learned from this is don't do mining yourself. If you don't know what you're doing, there's a lot fraction mining. I'm partnered with them. He's a fellow YouTuber, but these guys know way more what they're doing. They'll make better decisions. So if you're wanting to get exposure to mining, I thought it was cool to have one at my house and it's a fun conversation starter and it makes your parents look at you weird. Wasn't worth it. So in the future, fraction mining, those types of projects, if I want mining exposure, I'll get into things like that. So I hope this was helpful for you. Again, part of the reason I'm here is I want to make these costly mistakes with my money so that you can not, you can learn the lessons without losing the money yourself. Okay. That's what I'm here for. So hope this was helpful for you. Hope it was entertaining for you. Please hit like, again, that's what I use to, Hey, what content should I make more of and comment down below? What is your worst investment that you've ever made? And we can commiserate together. It'll maybe it'll make me feel better. Seeing your losses as well. So I appreciate you guys really enjoy what I do. Thank you so much for watching and have a great rest of your day. Thank you.