Part 3/9:
The best way to lose money is to buy or sell Tesla based on short-term momentum. Historical examples, such as Tesla's 50% drop in March 2020 followed by a rapid surge, illustrate how riding these waves can be treacherous without proper strategy. Momentum trading often leads to disastrous timing.
4. Max Out Margin Use and Borrow Heavily
Leverage amplifies gains but also magnifies losses. This rule sarcastically suggests using maximum margin to buy Tesla, then watching the stock decline and getting margin calls. Most experienced investors avoid excessive margin because it adds significant risk, but this advice encourages reckless borrowing.