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How to Make (and Lose) $2,000,000 Day Trading: The System & The Story
I’ve tried and failed to write this article ten times.
Even after I finished, I thought it was terrible–actually I was just scared to share the story. I sent it to a reader who had asked me about trading. He replied:
“It’s different than most that I have read because there is no bullshit to try and look past and all of your readers appreciate that.”
Thanks Garrett, here goes nothing:
A Kind of Introduction To Day Trading
This is about the lessons I learned while trading. The pitfalls people fall into and the ways people destroy themselves. There’s also the time I raised money for a hedge fund. Then my partner turned $30,000 into $2,000,000 in three months. It only took him two months to turn $2,000,000 into virtually zero.
We’ll get into the details later.
I mean trader as in “day trader”. From the time I was 15-22 I sat in front of 6 computer monitors watching charts go up and down. Why am I not doing it now? I didn’t make the billion dollars before hitting 22.
Traders are unique in that they might be the only group of people more delusional than entrepreneurs.
I say this lovingly.
According to my calculations, there’s no reason I couldn’t have made a billion dollars day trading. Never mind that 99.9% of traders are losers. Forget the fact that 80% of traders are depressed middle-aged men going through their mid-life crisis. (I saw one in the local library yesterday, he looked like he was avoiding his wife. I saw another today at Starbucks, he didn’t buy a drink and he smelled funny.)
I was the exception. I was going to get my billion-dollar pay day before my 30 th birthday.
And I actually was the exception. I made a nice chunk of money before stopping. I treated the thing with respect—not some get-rich scheme.
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It breaks my heart when I see people tell me they day trade and then see them following some bullshit newsletter or some coach with a fudged track record. When I see someone watching another FOREX algorithm sales pitch or drooling over some penny-stock report I just want to shake them and say You have potential! Stop letting yourself get scammed! Stop scamming yourself!
If you trade without the proper preparation you’d be better off in Vegas. This is not an exaggeration. Not only are there free drinks, sexy ladies looking for fun, and an obscene selection of Cirque du Soleil shows… your odds at pretty much any casino table are better than the markets. I mean this literally (like “literally” as defined by a dictionary)—you are guaranteed to lose money over any decent period of time unless you learn to trade well.
And then even once you’re prepared and you feel you know everything there is to know about the markets, you’re still not guaranteed to win. That’s just the nature of the beast.
That’s why I started meditating at 16. Trading is intense. In college I would make $5000 in the middle of class and then lose $10,000 a few hours later while watching a movie.
That kind of thing gives you a different perspective on money.
One last thing before we get into the meat of the post: Like Garrett said, this is probably different than anything else you’ve read on trading. Why?
- I don’t want to sell you anything. I don’t give a shit if you trade or not. Actually, I would almost rather you not trade… most people would be better off spending their life doing other things.
- I’m not currently trading. I’ve double-checked my methods and they still work, so the information is current, I’m just not spending my life using it.
- The focus isn’t on the method—although I’ll give you all the dirty details. You’ve got to be fluid as a trader. The top hedge funds in the world hire mathematicians, physicists, meteorologists… they are constantly shifting algorithms. How do you compete with these people? You don’t. This will make more sense later.
- I don’t have any stake in you listening to me. For real: nothing is for sale. I’m not going to teach you to trade. People that teach people how to trade or run newsletters giving trading ideas make more money by selling their ideas than using their ideas. They all have their own stories about why they are being so generous with their SECRET knowledge but it’s bull. (Not that all this information is bad, it’s just that you got to be careful—don’t follow anyone blindly.) (Wait, so what are my incentives for writing this? I just want you to like me—I want you to like me and this article so much that you subscribe for our newsletter and I can write more things. Also, I’ve been thinking about writing this for way too long and I had to do it.)
- I’m not trying to convince you the world is ending.
Okay okay it’s time for the meat and potatoes.
Meat and potatoes? Ha! You’ll be eating liquid gold with the information I’m about to give you! Yes, you too can be a Rich Kid of Instagram!
Just kidding, you probably won’t do anything with it. (And that’s probably a good thing.)
Someone did make $2,000,000 with this information though. For real, I watched it happen.
Before we get to that story, we’re going to go through some of the major pitfalls new (and experienced) traders fall into.
[Note: I’ve provided the meanings of some words but I’m going to leave the glossary work to you, Google, and other places on the Internet that like defining words more than I do.]
What Not To Do
Why start with what not to do? Because not smoking cigarettes is more healthy than eating all organic. Because if you lose all your money then trading becomes kind of impossible, doesn’t it?
“You can do a lot by avoiding bad as opposed to seeking good.” – Paul Graham, founder of Y-Combinator
DO NOT: Use Real Money Before You Know What The Hell You’re Doing
Warren Buffett’s #1 rule in investing is to keep your capital. He says that his regrets have mostly been acts of omission instead of commission. That is because he doesn’t throw money at something that he doesn’t think will work—and so he misses out on making money on tech bubbles but doesn’t lose his ass when they bust. (Honestly, Warren Buffett isn’t a trader… he plays the long term and hasn’t done anything but acquire massive companies—or huge pieces of them–for decades… he is one of the world’s best money-getters but not someone who will give you anything useful in trading.)
What does this mean for you? Paper trade before you put any of your capital on the line. (Paper trading is when you make trades with a fake account. There are tons of platforms you can use for this, I used TD Ameritrade’s Think or Swim.)
How do you know when to start putting money on the line? When a system has proven itself.
When has a proven system proven itself? For me, a month of profitable trading (and a statistically significant number of trades).
This infers the next DO NOT:
DO NOT: Day Trade Without A System/Method
If you’re trading willy-nilly you’re going to lose.
I don’t even know exactly what willy-nilly means, but if you have to ask if your trading would fall under the “willy-nilly” category, then stop trading right f*&#ing now!
You’re not George Soros, you don’t get to trade on your gut.
You don’t need an algorithm running on a supercomputer—but you do need some sort of system that won’t let you be an idiot.
You will tell yourself you don’t need a defense against being an idiot. This is you being delusional. Believe me. I betrayed myself too many times before committing to my systems. You don’t win every time if you follow your methods but you do do a hell of a lot better.
How Do I Create A System?
So what makes a good system? We’ll get into this more later when I show you the exact system I used (don’t skip to it, this post will be useless if you do that). For now, this will be helpful when thinking about how to approach your trading:
- Offense. It tells you exactly when and how to enter a trade. Maybe it’s “3 of the 5 requirements must be met to invest 1 share, if 5 of 5 are met – 2 shares”. This is one line of emotional defense: trading will make you think that you can make a million dollars today, this is very exciting, you will want to fudge the rules. Warren Buffett only broke his rules when he got bored—notice when you’re bored. If you think you can take advantage of more opportunities in the market then alter your system, test it, and implement it. Remember: no willy-nilly!
- Defense. It tells you exactly how to exit a trade. This means stop losses. (These are orders that automatically get you out of a trade when the market you’re in hits a certain price.) A common rule is to take 50% of your position (your money in the market) at a certain profit point, maybe 100% maybe 68.2% (this is a Fibonacci number that is extremely popular among traders). It also defines exactly how much of a loss you are willing to take on a certain trade. This must be determined before you enter a trade. If you don’t put a stop loss in your brain will justify your position over and over to you while your hopeful trade ends up losing you your house (and family). This is even more important than a strong offense—don’t go broke!
- Adding to a position. Sometimes you may want to make your position bigger as the market moves in your favor. You need to have a set of rules determining how you’ll do that.
- Don’t complicate it. Every tool seems so powerful, so prophetic! Early on I had a habit of adding signals that I would wrap up into my system. I theory they should make your trading better. Maybe it does for a Harvard physicist, it didn’t for me. The more complex I made my system the worse I did, over and over. I would start simple, screw it up by adding a bunch of things people recommended, then go back to the drawing board. The best method I ever used was dead-simple (that’s the one we’ll get to in a little bit).
- Give yourself a ton of room for failure. Eight out of ten trades failed for me. That was fine because when I hit a winner it won big. But if you’re averaging eight out of ten trades failing, then it will be common to fail 20 times in a row. I’ve gone through streaks of 40 failed trades in a row. You’ve got to be able to survive those. My recommendation would be to risk 1% (or less) of the money you’re willing to lose on each trade. That gives you 100 chances for failed trades before you go bust. It shouldn’t happen. (Of course, when I was twenty I was risking 10% on some trades… if I went bust it wasn’t that big of a deal.)
- It has to work. Again, test the damn thing. If it doesn’t make fake money then it certainly won’t make real money.
There is a time and place for throwing caution to the wind and just going for it. Trading is the worst place for that kind of bullshit. The adrenaline that comes from the potential of losing thousands of dollars in a minute is enough—you’re mission is to keep a cool head.
DO NOT: Get Big Fast
If you do this right, you have the potential for making a lot of money faster than any other method out there. (Excluding entrepreneurs who are insanely talented and simultaneously insanely lucky.) The potential—chances are it won’t go that way.
Chances are you’ll lose money.
Or you’ll make money, feel like a god, trade like a god, and lose all your money.
When you put real money on the line the game completely changes again.
You think you’ve tested your method. You’ve gone the first month and everything looks solid. Great.
Then you put money on the line. Shit gets real. You can’t seem to follow the system like you did in the test month. The market seems totally foreign again.
You don’t believe me, that’s fine. For you it’s different.
I don’t know how many times I told myself that. I’m different.
It doesn’t matter though, you’ll feel it the same as I did.
To save yourself some money though, trust me, start small.
DO NOT: Trade When You’re Emotional
I told you I started meditating at 16. It’s not because I was excited about being “in the moment” or that I was into Eastern philosophy. It was because if I didn’t I couldn’t trade. I’d mess it up.
James Altucher talks about how he created algorithms for each of his methods and then let them trade for him while he was depressed an losing everything. I wasn’t smart enough for this (and my methods inevitably had some level of subjectivity to them) and so I manually entered all my trades. (Entering a trade or “putting on a trade” or “entering a position” just means you’re buying (or selling short) into a market.)
James got to trade emotionally because he wasn’t actually trading.
If I got emotional then I would get silly.
You’ve got a system so this shouldn’t matter. But it so matters.
Imagine this: You’ve just gone long the corn futures market for 2 contracts. You’re up $5000 on a trade in two hours. Awesome, right? Hell no!
This is what happens in the two sides (side 1 and side 2) of your brain:
1. I want to take this $5000 off the table now, that’s a great win.
2. Yeah, but look at this pattern—this could be the BIG trade—this could be $100,000 if I add contracts.
1. Yeah, but it’s more important to conserve capital. $5,000 is a great win. Maybe I could just take half off the table.
2. Don’t blow it. That’s $50,000 instead…
1. Fuck. The system says to sell now.
2. Yeah, but the system isn’t perfect. You made it anyway—you can change it. You can feel it!
1. Yeah. But, the system…
And then on and on. I said “imagine” but that exact inner-dialogue is something I went through twenty times a day every day for a long time.
When did I make the right choice? (The right choice being following the system, not making money. A lot of people make money with a shitty trade and then think they have some special talent… of course they go bust within the quarter.)
I made the right choice when I let reason reign.
When did I make the wrong choice?
When I was either excited or scared. Both fear and greed will destroy you. (Immediate greed that overtakes your rational decision—which has longer term greed in mind.)
I’ve said this earlier, but it’s important to repeat:
A. Some days you will feel like a worthless human being who has done and never will do anything worthwhile. You will enter trades you aren’t supposed to because you’re afraid of missing out. You will exit trades before you should because your stomach is weak.
B. The next day you will make a winning trade and feel like a god. You will forget whatever it felt like to lose and you will make trades outside of your method. You will enter trades you shouldn’t because you have the feeling that you can’t do wrong (the market may validate you for a couple days and make the problem worse). You will stay in trades too long because you “know” that the market will turn in your favor—no way could you be wrong!
Your trading decisions need to come from numbers and predetermined rules. After years of deliberate practice and success you may actually get an intuitive feel for the market. Then begin introducing those feelings into your systems. Before then, no way José.
DO NOT: Trade Based on Some Purchased System or Newsletter
Listen, if someone has a really kickass way to make money trading they sell it to a hedge fund or use it themselves. They don’t sell it to you for five easy payments of $300.
That being said, there are some decent newsletters out there. The James Dines letter being one of them. It may be worth signing up for a couple, but don’t rely solely on them. Experiment with their information. Test their ideas against your method.
Do not follow them blindly.
Think about the incentives at work… there is nothing in your favor.
(This means, by the way, don’t follow the method below without testing it first. Just so you know–if I were actively trading it right now I probably wouldn’t have shared it.)
DO NOT: Get Caught Up In Stories
if you see this image – RUN!
Your system either works or it doesn’t.
People will devise elaborate narratives around their ideas they want you to buy into. They will spend countless hours telling you about this thing and why it’s the next took to make you a millionaire.
They will scare you by telling you you’re going to miss out on the next big thing. They will tell you that you need them.
You don’t. You need a system that works. Incorporate their idea into your system if you believe in it, see if it actually works. If it doesn’t, take it out.
DO NOT: Trade
This isn’t a joke. Most people shouldn’t trade. If you’re not willing to give everything to the market then it’s not worth messing with. Do what Warren Buffett says and put your money in the Vanguard S&P 500 index fund and go about your life. (Or invest in your own business.)
Of course, as terrible as trading is, it’s also freaking awesome for the right people. To this day I get a warm fuzzy feeling when I see a price chart. I’m not joking. I feel at home and I see patterns and I get the urge to dive in… Maybe I will again. Who knows.
For real: you should only trade if you are extremely drawn to it and if you can behave rationally (while remaining delusional).
Alright. here it is:
I was on break before going into my junior year of college. I was trading, doing pretty well. I was having a particularly good morning when I received a picture message on my phone. It was a screenshot of my partner’s trading account.
A couple weeks prior I received one that said $250,000. He had started with $30,000 only a few weeks before. I was freaking amazed.
This particular day, though, I didn’t believe it was real. The image read: $2,000,000 (and change, whatever). That was a “holy moly” moment, to say the least. I stared at it for a long time.
I texted back, “This isn’t real.”
How did that happen?
How did he turn $30,000 into $2,000,000 in three months?
Well, the method below.
But also! (And this is a massively important “but”.)
- He was more balls to the wall than I’d seen anyone ever before. Every bit of profit was immediately thrown back into the trade so his position ballooned like crazy. I actually used the term “stapled to the wall”.
- He was insanely lucky. See that lumber futures price chart below? You see that massive move down? Yeah, he got that at the top and rode it straight to the bottom. (He had a short position—meaning he made money as the price dropped.)
- He does have mental powers.
THAT is a move!ne
This combination ended up with massive losses in the next couple months. He still ended with an awesome five-month return… but you were a millionaire for a month and then not… well, it hurts.
I used this method with my balls about a foot off the wall and made great returns. I nearly doubled my personal account in six months and then was able to raise money from investors with that track record.
[Note: This method is specifically useful for commodity futures but can be applied more widely with certain modifications.]
Here is what we looked for:
1. Multi-Year High or Low
This method required constant awareness of price movements but not a lot of action. With this method you probably won’t be making more than two trades a week—often you’ll make one every other week. It’s also a bit unique in that we are trying to spot tops and bottoms of markets, something that most people will tell you is suicide: “like catching a falling knife”.
I just looked up the Corn Futures price chart at barcharts.com and found it sitting right at a multi-year low.
This is a weekly chart (each bar represents one week) so we can see that we’ve missed the bottom last week. We can zoom in to see if that would have presented us an opportunity.
The first is the simplest, this is the first filter I use to sort through charts: is it at multiyear high or low? You can see this quickly and skip it if the answer is no. If it is then go in for a closer look.
(I will keep tabs on a bunch of charts sitting at these areas while I wait for the other requirements to be filled.)
2. Hammer, Morning Doji Star, or Abandoned Baby Candlestick
[Note: I’m not going to get too technical here–just what you need to have a basic understanding and get started. I recommend you read everything at StockCharts.com’s Stock School if you have any sort of commitment to this. Candlesticks are just another way to view pricing information on a chart. An empty/white bar means that the price closed higher than it begun for the period of time measured by the bar. A red is the opposite, the bottom of the red bar is the closing price. The skinny area is the full area covered by price movement during the period covered by the bar.]
The second thing I would look for is a daily Morning Doji Star or Hammer Candlestick.
A Hammer Candlestick:
A Morning Doji Star:
Here is an Abandoned Baby:
Keep in mind we want these patterns at a multiyear high or low. Preferably with a gap. That means, for the corn chart above, we would want the price to open below where it’s current.
The gap shows one last push up. The two candlestick show consolidation of price movements. Basically, the price wasn’t able to follow through–signaling that this movement is out of gas.
Now, if you don’t see one of these right away, don’t discount it totally. Check for the third requirement.
3. The Producers Are On Your Side
General Mills buys a metric shitton of wheat. They move that market big time. It would be nice to know what companies like General Mills are doing so we could be on their side, right?
Yeah. And we can. And it’s pretty awesome.
Now, General Mills and other large producers use futures markets to hedge price fluctuations more often than trading for a profit like us. So we don’t take them with a grain of salt unless they are making significant movement.
Companies that trade over a certain amount of contracts are required to report the trades they make. These are collected in reports called Commitment of Trader Reports. You can get these reports here. You can get them in a more useful form (a chart) here.
Let’s see an example. I just looked up a promising chart of Soy Bean Futures:
We can see a great multiyear low (which is more obvious in the weekly chart, note that this is a daily) and some consolidation. Okay, let’s see what the producers are doing–this information is available to us in the red line in the mini-chart below the main one.
We can see here (and on here-just CTRL+F “soy” and you’ll see it) that producers (the RED line) are still significantly short soybeans and they aren’t in any rush to get long (“get long” means to buy).
Because of this I’m not going to make a trade but I am going to keep an eye on this over the next few weeks to see if a cleaner setup emerges. (A setup basically means the boxes for your method are checked off.)
We want to see the producers make a significant move in the direction of our potential trade. Here I would want to see a large movement toward zero.
[This is a fascinating topic. Check out Trade Stocks and Commodities with the Insiders: Secrets of the COT Report, it’s freaking amazing. And if the $40 price tag looks too high, seriously reconsider trading as an option.]
4. (Optional: For the insane ones) Balls-to-the-Wall-Re-Buy
My partner was able to make such insane returns because he caught a great run and leveraged it to the hilt. He put on a huge position and then used all the profits from each movement to make his position even bigger. That means you’ve got to hit a home run.
I honestly can’t recommend anyone do that. This method alone demands more risk than most (even though you can use mini contracts to take smaller positions). I played more conservatively and did well. When I trade again, I’ll trade even more conservatively. Capital is the first requirement for trading–without it you’re out of the game.
You need to set a stop-loss immediately after entering your position. I would give different markets different leeway depending on how widely they fluctuated normally.
Corn might fluctuate 10 points daily on average while Crude Oil might fluctuate 20. I would give Oil more wiggle room (not willy-nilly, mind you!)
The most important thing is that you set a stop loss with a loss that you can manage. It doesn’t matter how perfect a setup might appear, it could still lose money. You need to be prepared to take losers.
Ideally your stop loss is below the previous low. Sometimes you won’t be able to catch it that close, but if you can you’re golden. (You trade seeing more of a movement for taking on less risk.)
6. Managing the Trade
Let’s say we get long Soy Beans. We’ve got our stop-loss right under the previous low.
Version #1: The market moves against us and takes out our stop (this means the stop-loss is hit and we are taken out of the trade, we are “flat”). This is the most common scenario.
Version #2: This is the more interesting version–the market moves in our favor! Yeehaw! We’re not out of the woods yet though.
Obviously we would love the market to take off in the direction of our trade and lead us to our fortune. If this happens then count your blessings and remember the feeling–because it won’t come often.
Even when we get a winning trade, we have to work with it. It will go up a while and then back down, then up and then down.
When we talk about “managing a trade” we are really talking about three things:
1. Adding to the position. We talked about this a little earlier. Essentially you can add to a position that’s working to double down. Say you get a strong movement in your favor, then it pulls back a bit to consolidate, you can add to your position to double-down on the move.
**2. Adjusting our stop-loss. This is the one you will use most often (as in every winning trade). I like to move my stop-loss to my entry price as soon as possible. This means that if that market moves against you then you still don’t lose any money. I will normally wait until there is a new solid level of “support” created and then move the stop loss up to this new level. A support level is a price at which there is resistance to the market moving below. This is usually created by a small pullback. Continue to adjust your stop losses as the market moves in your favor.
3. Reducing our position (taking money off the table). I alternated between taking 50% of my trade off the table when I had 100% and never reducing a trade unless I got out completely. Often taking 50% or 30% at a certain point is a good way to lock in trades, the only problem is that it limits your upsides.
4. Exiting. At certain reversal patterns I would exit a trade and not wait for it to hit a stop-loss.
how we used to trade
Scary simple, right? (There are a few minor things omitted just for the sake of simplicity… these items decided most of the decisions.)
You probably noticed that I didn’t give you any examples of perfect patterns (if you go back and look at a more magnified version of the lumber one you’ll see a perfect setup). That’s because it takes a massive amount of work to find a great trade. I may have to look through 200 more charts before finding a decent setup.
If you’re really interested in this, go to BarCharts.com (or download a trading platform, I like thinkTDA) and look through every single commodity futures chart you can find. Look at a 5 year chart, then if one looks promising look at a 1 year chart, then a 6 month.
- Keep a list of ones that look promising that you need to keep an eye on. Review these every day.
- Once a week review ALL the commodities again.
- When you find a good trade, make it on paper. Either literally with paper or with your program (again thinkTDA is awesome… I don’t even have an affiliate link for them, they’re not sponsoring this post… but now I kind of think they should :P).
- When you start to get good at it, dip a toe in with real money.
That’s 4 steps and a ton of time.
I was going to recommend more books for you to read but I’m not. If you want them in the comments I’ll offer some up but the important thing is for you to actually apply this knowledge first. Go and spend an hour looking at charts right now.
This post ended up being fairly long… but the topic is huge. I glossed over a lot of technical stuff on purpose. The goal here was to give you an idea of what it is to be a trader and an example of a method to begin using.
I’m happy to answer any questions you’ve got! Just put them in the comments below or email me.
6 ways to make money on Forex without bidding
You can make money on Forex trading. However, there are ways to make a profit without opening deals. The 6 most popular ways to make money on Forex without trading.
Becoming a trader is easy, just open an account with one of hundreds of companies and you – trader. Become a money trader in Russia – a task feasible only to a very small number of people, since there are a lot of obvious and non-obvious obstacles to becoming a forex trader.
Having lost accounts several times, people who objectively understand their inability to earn money in financial markets, but with an active lifestyle, start looking for ways to earn money without participating in trading in financial markets.
So, we will begin to consider the main ways of earning without participating in the trading process.
1. Earnings on referral links
Many dealing centers, brokers and investment companies offer generous affiliate programs. Their essence boils down to the following: you attract customers through your referral (affiliate) link, your promotional code, etc. and you get passive income either from the volume of client funds raised, or from the number of client registrations.
How it works? You are the most ordinary person, accidentally or purposefully get to a page with a beautiful description of a generous affiliate program; go through registration, leave some formal data about yourself, get the treasured link, maybe some promotional materials about the company, and then – free swimming. In most cases, the company is not interested in how you will attract customers for this partnership program, the main thing is that the customers carry money into it.
You do not have your own website with high traffic and even the Internet page? Are you not ready for months to sit on financial forums and help people, so that for your help they somehow thank you? Welcome to the ranks of ordinary spammers, who within 2-4 weeks are trying to leave “their mark” in all corners of Runet. They invest some money in paying for the services of spammers in social networks and other so-called “promotion”.
Who benefits from this way of earning?
First of all, the company whose “partner” you have become. To you pay nothing, minimum payment thresholds, restrictions on validity period and others are assigned, which most “partners” cannot exceed, but scatter links; they are “mentioned” about the company, in the long run these links give a certain percentage of attracted customers, but you will no longer benefit from them, because the initial fuse is enough in most cases for no more than a month.
2. Earnings on paying the spread
About a year ago, I had to come across an Internet project that was quite successful. On Forex there is such a thing as spread Is the difference between the purchase price and the sale price in a bilateral quotation. This price difference allows you to earn a broker or dealing center on your transactions (in fact, this is their official earnings on traders).
One company decided to combine earnings on affiliate links not in one company, but in many, offering traders in return payment of part of the spread from their transactions, from the part that the dealing center or broker shares with this company.
How does it work?
There is a certain site that offers traders to register using its links with several major DCs, in return for the trader they will return part of the spread from his transactions. It is profitable for everyone to work in this scheme: the Dealing Center receives a stream of new customers, the Company receives remuneration from the DC for attracting each client, and a part of the funds is returned to the account from the Trader.
However, there are a few buts:
- At the initial stage, this company needs significant investments in advertising itself and its services. Competent affiliate program, etc.
- We need a constant influx of new customers, otherwise DCs or brokers may suddenly terminate the contract with our company: in this case, traders will stop receiving a refund of part of the spread, but will remain clients of this DCs or broker, and changing DCs or brokers is not a very quick process.
- There are already quite a lot of such companies on the market and all of them offer approximately the same conditions for traders. Increase the% of payments to traders – to remain “without pants” themselves, try to offer additional bonuses like “free consultations of lawyers, economists, psychologists, clergymen”, etc. – A very dubious advantage for experienced traders.
In this way, this method of earning will be very successful if you have sources of attracting an unlimited flow of clients to open real accounts, competent employees, a serious advertising budget and an established system of interaction with dealing centers or brokers.
3. Earnings on writing forex advisors and experts
Are you a programmer?
You have the opportunity to earn money on writing trading robots, advisors, indicators and other software for traders. There are several most popular programming languages for trading terminals: for example MQL and RuLang. If you set a goal and achieve it, leave announcements everywhere, actively participate in the life of financial forums, and help people qualified for free, then you can gain credibility and a client base. On average, you will have several orders per month, which will be a good run-in for both students of technical universities and qualified programmers.
4. Earnings on the sale of signals
Currently, there are many sites that offer traders trading signals for a fee. Many of them have open statistics of profitability, there are free test subscriptions, etc. This method of earning can be done in several cases:
- you are an experienced traderwho, without his own positions, calmly predicts market movement and can give the right recommendations;
- you are the owner of the trading system, which gives quite clear and adequate signals;
- you are a competent translatorwhich, by subscribing to a paid newsletter from any foreign site (or several sites), you resell their signals.
When selling signals, you need to understand the measure of your responsibility for them and, if possible, minimize the risks of losing customer deposits, with false signals that are rare, but can be found in any trading system.
5. Earnings on investing
You can invest in completely different amounts, in different ways and with different returns.
The most popular forms of investing are PAMM, PIF and DU. Speaking of investing, we are talking about a person or group of persons (companies) to whom your money will go for a certain period, in order to return later with a profit. What you need to remember in order for money to return profitably, or at least to return in general:
- There are open PAMM Account Ratingswhere you can see the statistics of each manager.
- There are stable (we read “long ago”) investment companies operating in the market.
- There are well-known (read “experienced”) private traders who take funds to Trust Management.
- Exist drawdown thresholds (decrease in the amount of your deposit), after which the manager closes the position in order to prevent the zeroing of funds. So they are negotiated in advance.
- There are also forms of formal agreements with managers (since in the Russian Federation agreements concluded orally do not have legal force).
- Does not exist companies or managers who will offer you 50-60-100-200-500% в месяц of any amount you make. All such offers can be seen as an attempt to deceive you or risky investment on the verge of a foul.
The following point should be understood: in order to somehow live more or less on interest from invested capital, the amount of this capital should be from $ 10. Are you ready to give 000 rubles to receive 300-000 thousand every month?
6. Earnings from participation in contests not related to trade
Most DCs and brokers spend all kinds of forex traders contests and tournaments. In fact, they are divided into 3 categories:
- Non-trading contests like “Who better to wish our company a Happy New Year”
- Demo Account Contests
- Contests on real accounts. Of course, we are interested in the first option
To keep abreast of the competitions held by different companies and successfully catch a freebie, you should subscribe to their newsletters and be prepared to compose poems, creatively photograph or shoot videos with the symbols of a particular company (therefore, it will be useful to stock up on templates and logos in advance), as well loyal friends / sites and others that will take your creativity to heaven.
It is important to understand the essence of such contests from the point of view of the marketing department: The winner is the one who not only did something better, more interesting, more creative, but also the one who draws more attention to his work and, accordingly, to the brand of the company conducting the competition.
So what should you choose? The question is rhetorical, but solvable. You can try a little of everything, really assessing your strength.
Education and Research
What are Buy & Sell Limits, Buy & Sell Stops? When and where is the best place to use them?
If you’re a middle school basketball star, do you cry when you skin your knees after getting fouled when you chose to play street ball in downtown Detroit? No, because you should have known what you were getting into, and if you do cry, all the street ballers will tear you to shreds. If you don’t want to play street ball and learn to play like everyone else does.
Hey TradingView In this video I will be going over a swing trade from this week and breaking down how this trade could impact a trader’s psychology both positively and negatively. I also cover some easy to implement strategies that will make it much easier for you to let your winners run. It really bothers me how little attention seems to be devoted to trading.
Greetings, I’ve spent a considerable amount of time trying to find the magic formula to stay profitable, I’ve read books, I’ve heard speeches, I’ve talked to pros, and I’ve stayed profitable, BUT. I’ve also lost quite a bit, I tried coding my strategy to see how it would really perform without sentiments, as executed by a machine and I was really suprised, no.
SOME WORDS FOR NEW TRADERS: 1. Learn from the Ideas in tradingview, pay attention to trading logic (why did this author want to long/short? ) 2. if you can not understand the idea, or u disagree the idea, then dun trade it. 3. if you want to trade based the author’s idea, make sure u make a very detail trading plan for yourself. the entry, the stop loss, the.
You took a short position when you break through a symmetrical triangle in a downtrend. Then the position began its realization, becoming a profit deal, and the price was consolidated in the trade corridor, the continuation pattern – a rectangle. Then the price as expected continued its downward direction having broken the borders of the rrectangle. Now you.
Hello friends! Thank you for your support in my previous post! It was not as popular as the first one but I could see from the comments that many of you found it interesting. Your feedback by comments and likes show me that some of you are learning and that is motivating for me to write more! This time I want to address another mistake I see the ones who just.
Hello friends, first of all, you can support this idea and follow simple questions in your trading. This post will help you find your ways in trading. Before any trade, ask simple questions and make sure you have answers. Can you afford to lose some amount money? — Accept the risk. Don’t fool yourself. Do you have a strategy for trade? — Plan where you will.
PANIC SELLING of stocks due to Coronavirus. in fear that earnings for top companies will drop as productivity comes to a halt. ⚠️ Historically, the SARS outbreak did not cause the stock market to dump farther as we were in the tail end of the Recession. Coronavirus appears to be coincidentally at the top of a market rally and is just a social trigger to.
Compare some major asset classes (USD, Gold, Oil, S&P500, Nasdaq, Russel, 30Y Treasury yield, Commodities, and . BTC) over the past 20 years. Scroll the graph to make the starting point on the left a different point in time.
This week was a Great week in the Trade room for The Gold Method Ichimoku. Love the community that we have developed in our Trade room. Here is a day by day breakdown: Monday, we took a breakout trades on GBPCHF and GBPJPY. (either but not both unless you split your risk between the two). Both trades easily made their profit target with minimal drawdown.
Here is the Weekly review for the week of January 20th through the 24th: Another strange week as the GBP pairs remained in a consolidation. We only took one trade, which was a failed breakout on GBPAUD on Monday for a loss of -27.6 pips. Recognizing and adapting to the current market conditions we became more selective with our trades. By doing so we avoided.
This week tested our patience and discipline in the Trade room for The Gold Method Ichimoku. Here is a day by day breakdown: Monday, we passed on both a breakout trade and a MA trade, both of which made money. However, despite the potential result the decision to stay out based on the market conditions at the time was correct. Tuesday, we had a very nice Type 1.
This week was an unusual week in the Trade room for The Gold Method Ichimoku, as World events affected the currency markets. Here is a day by day breakdown: Monday, we took a Type 2 trade on GBPAUD (some took GBPNZD), which did not work out. We then took a Type 1 pullback trade on GBPCHF, which also did not work out. Our third trade was the charm as it ran to.
Hello, I have to look at some details on a FX strategy and it is alot of mental effort, therefore here I am looking at high short interest on stocks that I do not even trade Let’s look together at the most shorted stocks in the USA. What I think happens in Wall Street is every one copies every one. If a fund misses out on something that every one else has.
Hi Guys; Since I have had several traders ask for a description of the methodology. I created a You-Tube video. Here is the link: youtu.be The Methodology is contained in my E-book, The Gold Method – Ichimoku. This is the most complete publication that I have done. The first several chapters, explain in great detail, my methodology. The next.
With great trading comes great responsibility and a little sacrifice. It is not something you should take lightly, into your life. This is a forever business where you can either screw it up or you can make a success from trading. Before the year is up, I’m going to share with you my 5 top trades, you’ll need to take in order to achieve your trading goals for.
Dear trader, something to think about. Is it possible to make millions of $$$$$$$$ from $10,000 in 12 months? For sure! Check out this great story. *Daniel J. Zanger is a technical stock and equities trader. Zanger hit the media spotlight after audited returns showed he turned $10,775 into over $18,000,000 in under 2 years. Personal history Dan Zanger holds a.
WHY MOST OF TRADER FAILS .
It has been estimated that 90 % of aspiring traders sends in smoke their money within the first year of operation .
The question that arises is:
why this happens ?
trading is so difficult that only a select few can be successful ?
The answer is NO ;
Anyone can potentially be a good trader but the precise conditions .
The forex trading is a very lucrative .
For this attracts many beginners , enticed by easy money .
More or less , after an hour of study on how a trading platform , everyone is capable of placing an order and probably why you have the illusion that being a trader is not that complicated , and that the millions are behind ‘angle!
Maybe it can happen that the first trade are lucky and you think so that you understand everything already beginning to increase the size of the positions .
Then at some point , there comes a big unexpected loss that halves its capital .
The trader then improvised seeks to recover everything at once . But things do not work like the beginning and the capital continues to decline inexorably toward zero .
This is a stereotypical scenario, but not very far from reality . The problem is that very often beginners are thrown into the market with large sums of money or the opposite with too little money ( you can not trade with 100 euro . ) , hurried to realize substantial gains without really knowing what they do .
There are many other lucrative professions in the world :
the lawyer, the bank , the doctor , etc .
These professions , however, require several years of study and apprenticeship before getting a significant economic return .
So why the trading be any different?
Trading is a profession like any other.
It can be carried out not only as a part-time employment ( for an extra gain with respect to a ” classical work ” ) ; but also as a real profession in any case , however , it serves to study and acquire specific knowledge .
When you start with real money it is important to start with caution opening small positions . The key point is not to win a lot at once, but you stay in the game long enough to really know how to move and start making money really .
There are 3 KEY CONCEPTS that an aspiring trader absolutely must know before you start.
1. Rigorous method:
It ‘important to choose a strategy that suits your trading style and stick to the strategy without inventing. Trading is a systematic business; trusting intuition can lead to some lucky winning but eventually not work.
2. Money management:
Manage capital is critical. The secret to success in trading is to preserve its capital no matter what. And ‘basic figure out the right balance between maximizing profit and keep the risk under control.
Only good money management will allow you to make money from the success of your trading strategy.
3. Cold Mind:
Psychology in trading is an aspect overlooked but is very important. When there is money at stake stress increases compromising our lucidity in making decisions. It tends to close in profit positions prematurely to cash a quick profit. On the contrary it tends to leave open too long losing positions hoping they can recover. This means that the winnings are smaller than the losses and the long run this destroys the trader’s capital. Psychology in trading is important to be able to implement its strategy without greed or fear. The good trader learns to have confidence in their system after the “defeat”; likewise he knows how not to get carried away too much even after many “victories.”
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