10 Years of Gambling Addition in the Stock Market

what-if-i-told-you-daytrading - CopyI have managed to control my addiction to gambling in the stock market for almost 3 years, but I have never stopped being an addict. I guess that it must be like being addicted to alcohol or any other drug. You control the urge, but the urge never goes away.

Since early childhood I always wanted to be a millionaire. My father was a millionaire before he lost it all. He gambled his life and lost but he was so alive while he was going through his ups and downs.

I wanted to make my millions the scripted way, by getting a diploma, getting a high paying job and accumulating wealth until retirement. Latter I found out that working for someone else is the dumbest way to become a millionaire; you will always be someone else’s puppet. Whether you are the CEO of a company or the president of a developed country, you will always be kissing someone else’s butt in exchange for your millions.

Another impediment was that I was a terrible student. To this day, I still resent my university education. I consider university to be a big scam that robs your money, your time and your creativity. According to Seth Godin, the number one purpose of schools is obedience. Do as you are told! We are training you to be a robot, a factory worker, nothing more that a cog in a wheel to work in a repetitive motion environment all day long 40 hours per week. http://www.youtube.com/watch?v=sXpbONjV1Jc

While in Montreal, I decided to invest in mutual funds (today, I hate mutual funds). I read hundreds of prospectus, had many passionate conversations about the best mutual fund to pick and I finally picked some Canadian Index fund. From my under-the-table jobs ( I did not have a working permit when I arrived to Canada) I managed to save $50 per month and I would rush to deposit my cash in the bank as soon as I could. It was at that time in history when all the mutual funds were going up, so I was already considering myself a genius for making that first investment.

When I had saved $5,000 I sold my mutual funds and I decided to invest directly in stocks. Once again, I started reading all kinds of financial newspapers, watching financial tv shows, and immediately I became obsessed with the stock market. I started to make some low risk investments (buying and holding banks and collecting dividends), but it got boring fast. I wanted to invest in the latest fast-moving Internet companies, the latest oil discoveries, gold, silver, the dollar, the yen… I wanted it all and I could not satisfy my thirst.

I was cursed with beginner’s luck. My first few trades were successful and I was hooked for the rest of my life. I would wake up at 5:00 am to see how the market closed in Asia, then I would follow the market in Europe until the opening time in New York at 9:30 am. I would make my first trade and make my money within the first half hour or agonized for the rest of the day over my losses. I would gamble $30K to $50K every morning.

I was clueless and I relied on my good luck while portraying myself as a person who knew what was going on. The adrenaline rush would come to my head as soon as I would hit that “buy” (or sell) button and I would faithfully watch tick by tick as I was making money or I losing it all.

I would try to keep my emotions under control. I would try not to bore my wife to death when telling her that we made one thousand dollars in half an hour and I’d try to mask my sorrows the next day when I’d lose the same thousand dollars in another trade.

In general, I was barely breaking even, perhaps losing over a long period, but there were some remarkable successes that I remember with pleasure. One time, the “Breaking News” anchor man announced that XYZ company just discovered a massive amount of oil in Argentina… a few seconds later I had bought about $30000 of shares. I made about $6000 profit in about 2 hours of gambling, 20% return in two hours. That day I smoked a big Cuban cigar (a Cohiba ) and was high for the rest of the day. I had other spectacular gambles that allowed me to get out of the business with a profit.

One day, I felt that my head was going to explode. I could not enjoy myself in my personal life. My heart and soul belonged completely to the market. I wasn’t able to enjoy a holiday or a weekend with my wife or friends, I wanted to be in front of the screen, gambling 24/7. I wanted to liberate myself but I didn’t know how. It came to this: I was having a miserable day, I was losing big. Out of frustration I sold everything, the winners and the losers, everything. I took whatever cash was left over and I rushed to buy a condo in Le Plateau so that I wouldn’t have any money to go back to the market. It worked; I have been out of the market for almost three years now. But I have never stopped missing it.

To this date, my desire to trade has never gone away. I learned how to control it, but the urge is still there.

The beginning and end of a successful marriage ( Alain & Cheryl / 2007-2010)

Montreal, April 2006.

Wedding. Dec. 2007

Wedding. Dec. 2007

It was the one night that I was hoping not to meet anyone. I had just finished a painful relationship and my friends and I went to a dance event. I just wanted to be out of my apartment. Fate was not consulted about my wishes and sure enough some old friends recognized me and came to say hello. As we were chatting, they introduced me to Cheryl, the guest dance instructor of the night, a very good-looking red-head, slim girl with a loud laugh.

As the night continued, I noticed that Cheryl had stayed most of the night standing by my side. She would dance with others but she kept coming back to stand next to me and my friends. I thought that she had found me attractive, and later found out that it was indeed rare for her to actually stand and socialize at a dance event.  She would typically just dance the whole night.

Short escapes from work

Short escapes from work

Once I felt satisfied with my excursion outside my apartment, I was ready to go home. Cheryl was dancing with someone when I waved goodbye. It was so funny, she practically dragged her dance partner towards me and asked me for my phone number (while still dancing). I avoided giving her my phone number but she would not take “no” for an answer, I finally gave her my phone number.

We had one Argentine-tango date before she hired me to teach a weekly salsa class with her. Our work together led to social outings; a few coffee dates, a few restaurant dates, and I panicked: I broke up with Cheryl before anything got started. I was terrified. The scars from my previous relationship were still fresh and I was afraid to get involved, I was afraid to get hurt again. But the next day after breaking up, I asked her for dinner again.

Exploring the woods

Exploring the woods

Working together created a bond. We had a common project. We were happy to work for the community and we created a wonderful dance school called Dance Conmigo. Our project became the center of our lives. We enjoyed working together and our relationship continued to grow each day. After 18 months of dating/working together I asked her to marry me. She said “yes”, and we got married at the end of 2007.

Our wedding was perhaps the most fun wedding I have ever attended. The ceremony and reception were done at the dance school that we had created. The ceremony was small and intimate with only family and close friends. The reception was incredibly fun. Many of our friends were professional dancers and musicians who danced and played music for us. We had tears of joy all through the day. (First danceNative Jingle Dance, Guests dancing, Tribalfusion Bellydance)

Christmas with Cheryl's family

Christmas with Cheryl’s family

What made our marriage special was that we were sharing a journey together. We were participating in a fantastic project which was the creation of a community of social dancers under the umbrella of our dance school. We wanted to create a place where strangers could meet and feel part of a big family. It was important to us to create an ambiance of inclusiveness, where ability, age, race, religion and social status did not make a difference. We hoped, in addition to learning dance, that people felt at home at our school.

Our conjugal life and our professional life became entangled and we were enjoying it because we were 100% devoted to the cause. Occasionally we would rent a chalet outside of the city and enjoy moments of relaxation which would reinforce the pleasure of each other’s company even outside of our common goal. Another source of personal pleasure was attending family gatherings; birthdays, Christmas, thanksgiving, and just the random dinners (which I still attend even after our divorce).

Trip to Cuba after getting divorced.

Trip to Cuba after getting divorced.

However, in spite of our blossoming professional life, our days at home started to become way too similar. We would start work from the moment we would wake up, finish a 14 hour day by going home, renting a movie and falling asleep before the movie was over. Although we still enjoyed each other’s company, we noticed that our relationship was morphing into a friendship. We were not growing anymore as a couple, we had hit a plateau.

We had many conversations, we put the problem on the table and tried to discuss it, but nothing changed. Finally we decided that we should continue being friends without sharing the same bed, and we decided on a divorce.

Our divorce was as great as our marriage. We decided to celebrate with a trip to Cuba, at an all-inclusive resort, with the sea, plenty of food, alcohol, and each other’s company, now as friends.

To this date Cheryl and I are very good friends. We enjoy our present relationship as much as we enjoyed our marriage. I thank Cheryl, my ex-wife and my present friend for all the moments that we shared together.

How I Started And Ended A Profitable Dance School

Alain And CheryIt was the beginning of 2006. Cheryl Williams, my new dance partner, and I arranged to meet at a Starbucks café in downtown Montreal. I don’t remember if I was more excited about her company or about the topic of our discussion; we were going to talk about the creation of a dance school. She named it “Dance Conmigo.”

We had a brainstorming session. Some of the details escape my memory but our ambitious plan was to teach two dance classes per day, five days per week, with a minimum of 10 students each. This should give us about $500 per week per person plus a lifestyle of many hours of leisure time. Two hours of work per day and the rest of the day to f*#k-off. Of course, it never worked out that way but it was nice to have a goal.

In business, as in life, nothing is constant; you are either growing or regressing. We had a rapid growth, a plateau and a regression.

Between my dance students of earlier years as a salsa teacher and Cheryl’s previous students we had a nice base and when we brought those two groups together we had a full class. Also, we were fortunate to have some friends ( Robin and Marcy) who helped us with the promotion. Right from our first semester we were profitable and continued being profitable until the last days of the school.

We started teaching Salsa, then Ballroom, Argentine Tango, Belly dancing (Taught by Danielle Davies), West Coast Swing, and a few diverse workshops. We had so many classes that we didn’t have enough hours to schedule all the classes that we continued adding. There were a couple of years that we had different classes going on at different places at the same time.

One of the highlights of our career was hiring Danielle, a fantastic belly dance teacher who, at one time, on her own, organised about 10 group classes and workshops with very little help (we wanted to adopt her). Also, we brought several well-known West Coast Swing teachers from the U.S.A. to teach workshops at our place. We capitalized on the popularity of the TV show “So You Think You Can Dance” and hired one of the finalist competitors to teach some classes for us.

We were hungry. We would search contracts everywhere. We would go to high schools, universities, community centers. We would dance for free to promote our school. On some occasions we were invited to teach in Ottawa and Toronto. Life was good!

To promote the sense of community we were hosting a weekly two-hour dance practice every Friday. Later we scaled it down to once per month for 4 hours. Our dance parties grew with the school. We had one room (the ballroom room), then we added a second dance room (the salsa room) and finally we added the third room (the tango room). We were getting over 100 people attending our parties. People were delighted. They never had so much diversity in one place for such a low price.

Eventually it got to us. The only way to continue the growth was through constant promotion. Email, YouTube and Facebook were our tools of choice. We would spend the day answering questions, answering the phone, promoting the next dance class, the next event, seven days per week, from waking up until going to sleep. We learned SEO, we learned how to build websites, how to make videos, how to buy Google and Facebook advertising, etc.

Saturated with our demanding lifestyle, we started to do less marketing and the results were immediate: less and fewer people would register, our classes began to look empty. We eliminated ballroom, then we eliminated tango. We held on to Salsa and WCS until the last moment, but eventually, there were not enough students to justify teaching these classes either.

We came to the realization that we weren’t hungry anymore, we were tired, tired of answering the phone and responding to emails. We started winding down and November 30th 2013 became the official date to close the school.

Overall, I must say that it has been one of the most beautiful chapters in my life. I felt that we were manufacturing smiles. People would arrive from their work full of stress and, a few minutes into the class, a smile would start to appear. They’d leave light and happy. We were so proud of our community. And the cherry on the cake; we made a nice living for our effort.

I thank my dance partner, my friends, and all our students for all their support. It will always be one of the most important and beautiful moments in my life.

As An Entrepreneur You Get Time Flexibility, Autonomy And More Money

Life as an entrepreneurTime flexibility

When you work for “the man” you get very little time flexibility and hardly any autonomy.

If on Friday you want to leave work early because your son is playing in the soccer finals, or any other personal reason, you have to depend on the mercy of your employer.

Some people have great employers who are understanding, but there are people who have horrible employers who treat their employees as slaves and will not give them any time flexibility.

As an entrepreneur, even if you work 18 hours per day, you always have the liberty to take 2 to 4 hours to enjoy to those important family moments. Or if you are one of those entrepreneurs who values leisure time, you can set up your business to work only 4 to 6 hours per day. Personally, I am arranging my life to work only 4 hours per day.

Autonomy

If you have a great boss, you may be at liberty to do your job the best way that you see fit as long as you deliver results. But if you get one of those micro manager bosses, you are in for a very unpleasant ride. You will be in a state of asphyxia the whole time.

As an entrepreneur you get to decide how to do every part of your job. You can create systems and procedures to fit the way that you work.

Dress code

The way you dress at work  could range from formal to casual. Usually the the closer the contact with the clients the more you have to conform to the dress code of the imposed by the employer. This applies to whether you work at a bank or at the local McDonalds. I just heard of some one who got refused of a job at McDonalds because he had tattoos on his arms.

As an entrepreneur, your clients might expect you to dress in a particular way,  but most of the time you dress whichever way makes sense to you. I have been criticized by my dance partner for always wearing old and ugly clothes. I will make an effort to listen to her, but still, the final choice is mine.

Working in Quebec.

If by any chance you work in the province of Quebec (a francophone province), and you work for the government, you are not supposed to speak any language other than French at work and you you are discouraged to wear anything that showcases your religion. I don’t know why anyone would work for the Quebec government, but if you do, your are more restricted than in any other province in Canada. If you do work for the government, the best thing is to start drafting your escape plan as soon as you finish reading this blog.

Money

As employee, your earning potential will be determined by your boss. Very few companies will allow you to become financially independent. You probably will no be poor, but for sure your earning potential will never be maximized. Your earning potential is supposed to make your boss rich.

As an entrepreneur, your earning potential is unlimited. All the wealthy people of this planet are entrepreneurs. They decide how high they want to go and they go for it. Personally, as an entrepreneur I am in a position where I can increase my salary every year and I do increase my salary every year.

Conclusion

As an entrepreneur, your life will be more fulfilling, you will have flexible hours, greater autonomy, no dress code and your self steam will be higher.

Sure, being an entrepreneur is not easy; you have to put up with a lot of uncertainty, you have to have a strong belief in yourself and go against the popular belief that we all should get a degree and work for the man. But when you create your own road, ant things work out well, there is no other way of life that can compare.

My First Real Estate Investment

Houses in the PlateauReal Estate is the oldest way of accumulating wealth. Does it still make sense in our present day?

On December 1st 2011, I bought a condo in the best neighborhood of Montreal, “Le Plateau Mont Royal.” I bought this condo with the intention of renting it completely furnished.

Here is the cost of the property:

  • Condo $230,000
  • Notary expenses: $1,200
  • Tax of purchase: $2,050
  • Furniture: $3,000
  • Total purchase price: $236,250

The interest rate on this property is 3% and the term is 25 years.

Had that the bank had financed the property 100%, my monthly payment would be $1,120

Other monthly expenses;

  • Insurance: $21
  • Condo fees: $114
  • Taxes: $157
  • Electricity: $90
  • Internet: $50
  • Supplies: 20

      Total: $452

Total monthly expenses: $1572 ($52.5 per night)

In order for me to be cash flow positive, I must rent the apartment for $1,600 per month. (it is rented for more than that).

Additional benefits.

  • In 25 years, the condo will be completely paid
  • I get to increase rent about 2% per year, increasing my cash flow every year.
  • The value of my property will increase at the inflation rate of 2% per year.

Conclusion: 

I took me about 60 hours to do all the work involved in buying a condo, decorating it and renting it out. In exchange for those 60 hours I became an owner of a $230,000 property. Assuming an inflation rate of 2% my property will be worth $413,000 25 years after the purchase. If I do this same transaction, once per year for 4 years, I will be controlling the equivalent of 1 million dollars in properties; I will be a millionaire! If I divide $230,000 for the 60 hours that I put on, I am getting paid $2,833 per hour.

At this moment, I dare to say that YES! real estate investing is still worth your time.

Investing in real estate requires some courage, but if you manage to get the courage, the reward can be substantial. What are the alternatives? Working for the man?