All for the pursuit of happiness


Ishan Dan | Manager Investments, Powerwrap

It would have been over a decade ago now that I joined the fast paced and cut-throat stockbroking world, yet it almost feels like yesterday. I had always wanted to be stockbroker. The hustle and bustle of brokers yelling out orders and trading stocks gave me a buzz like none other. I couldn’t think of doing anything else. Nothing else interested me. I loved trading shares and watching charts. I traded shares while I was at uni, at home and even while I worked as a mobile phone salesman. I was a great salesman. I wasn’t a shark but I could easily sell ice to an Eskimo. Combine that with trading skills and a stockbroking career was the perfect fit. Of-course it wasn’t easy, no one would hire me. I copped rejection after rejection. I never gave up though and in the end I got lucky. The boss at a well-known stockbroking firm took a liking to me and gave me my first lucky break. He hired me on the spot. Fresh out of uni and with little experience, I punched the air walking down Collins St, tears of happiness streaming down my face, I felt on top of the world. It was one of those Will Smith Pursuit of Happiness moments. I’ll never forget it.

On my first day, the big boss handed me a licence to make money. ‘Authorised representative’ it was called. I was also given a computer, a phone and a share registry. That’s a list of shareholders and their contact details from an ASX company. Away I went. My job was to ring the three thousand odd shareholders on that list and convince them that I could make them money. If I did, they’d open an account and trust me with their life. A daunting task but after a while I got the hang of it. I hardened up and rejection didn’t both me. With the help of a flamboyant broker who sat next to me, I perfected my pitch and started to sell stocks as if they were mobile phones. It was a bull market, everything went up. This was after the GFC when the mining boom was in full flight. It was all about mining and geology. Because my broking firm covered mining stocks, mining CEOs from a small cap mining companies would visit every day. Desperate for capital they’d give a flashy presentation on high grade gold, uranium or what-ever element on the periodic table they thought they had found. Of-course most of those tiny companies no longer exist. They’re long gone or have been transformed into tech companies. If they came out with a good drill hole, a 20c share price was over $3.00 tomorrow. Millionaires were made overnight. Sometimes all it took was a positive research report and the stock would double. It was easy to make money during the mining boom, you could throw darts at any small cap mining stock and ride it to the moon. Times were so good, extravagant lunches were a daily event. Life was great.

Little by little I started to build a portfolio of clients that I would speak to almost every day. They trusted me and I trusted them. Everyone was winning. But I hadn’t struck it rich yet like some of the older brokers. I was told to really make it you need a ‘ten bagger’ i.e. a stock goes up to 10 times its purchase price. One stock to rule them all. One winning horse to put your entire client base in. I decided on a stock called MEO Australia. It was a junior gas explorer that was on the verge of hitting a massive LNG discovery. It was the most talked about stock on my desk. MEO this, MEO that. Everyone’s buying MEO. “It’s already up, get on it before it’s too late.” And so I did. I sold the story like a scene out of the movie Boiler Room. I put my dad’s money in it, my then girlfriend’s savings, my friend’s house deposit, every client I had and my entire savings. And so MEO began to rise. It was drilling the highly anticipated Heron-2 well in the Australian waters of the Timor Sea. If the well came good as everyone was so sure it would, I’d be driving a flashy new sports car and walking on sunshine. Shares had run up from 30 cents to well over $1 and some broking firms had given it a valuation many multiples higher. Management were confident and everyone was buying before the big news due for release the next day. Shares rallied 17% on the day to $1.32c. It was a sure thing or so I thought.

I’ll never forget that morning. I came into work excited yet slightly nervous. We all watched our screens waiting for the announcement. When it came through, there was silence. “A production test in the Heron-2 well has FAILED to produce hydrocarbons to the surface.. the joint venture is currently considering the suspension of Heron-2 to allow re-entry at a later date”. I re-read it over and over and then screamed out, “What? What does this mean?” A fellow broker leant over and whispered “It’s all over mate, they hit nothing. They’re done.” I sat there in utter disbelief, unable to comprehend what had just happened. How could this be? And then it started. Shares came out of its trading halt and went into free fall. They fell from $1.59 to 0.26c. That’s an 84% fall at the blink of an eye. A $100k was now worth $16k. I almost vomited. I went into a panic and started shaking. I didn’t know what to do. It was like a car accident. Everything was ripped from under me. It went from fun and games to a horrible nightmare. How was I going to tell my clients, my dad, my girlfriend, that I’d just lost almost all their savings?
I picked up the phone and called the client that had lost the most. He answered the phone with an excited voice, expecting me to deliver good news. It was anything but that. He went silent, then started yelling. I could feel the pain in his voice, it was gut wrenching. There were countless nights where I’d lay awake replaying his voice over and over. I said sorry to him so many times but the damage was done. I’d blown him up and the best I could do was apologise. I walked outside and balled my eyes out right in the middle of Collins St. But the worst was yet to come. My next phone call was to my then girlfriend, that didn’t go down too well. That day still haunts me.

They say sometimes you need to lose everything to appreciate, understand, and gain it all back again. Sometimes you need to lose it all to find yourself. There is a lot of truth to all that. One thing’s for certain I learnt one hell of a painful lesson. I vowed never to be so ignorant again. I vowed never to listen and follow others so blindly and never to make decisions without doing my own research. I vowed never to let this to happen to me or to a client again. I vowed never to be so blasé with life and money. I was a fool to think I could get rich quick. Life doesn’t work like that. And so I created a system of checks, stop losses and controls to prevent me from making rash or irrational decisions that could put my financial freedom in jeopardy again. My life changed forever that day. At the time it seemed it had changed for the worse but looking at it now it was a lesson that has helped me make far better choices with life, stocks, money and my career. There’s no amount of money that can buy that.