An Unfortunate Huge Gain

Back when I was an investment virgin, I was talked into a retirement fund that had many hidden costs. To get out of it, I had to pay steep penalty fees. I promised myself to never again be fooled by sleek-suited financial professionals. So I buried myself in investment books and decided to go with stocks. I found out about Warren Buffett and his investment philosophy, and read books by investors he admired, Benjamin Graham and Philip Fisher. Intent on developing my own system based on my readings, I dove headfirst into stocks. Unfortunately, during the first year, I earned 47 percent after taxes. Why is that bad? Because it led me to assume that I had a natural stock-picking gift. In my second year, I lost 10 percent. I've redone my system countless times and have tempered my emotions. This year, I am up almost 30 percent.

- L. Guadiz, Tokyo

The Fool Responds: Becoming a great investor does indeed take time. You're smart to learn from the best and to avoid acting on emotions, such as greed and fear.

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