Imagine buying TASR at $5.
going away on a world cruise for 9 months.
Coming back and it is at $300+? Many fortunes have been made by complete stock markt novics because they got lucky and did not try to over-trade.
For example, let's say ABC stock lashes a buy at $30.
You buy and 3 months later it is at $50.
You think great I am up 66% I am going to sell and re-buy (or even worse short what you consider a temporary top.
).
You sell out and wait.
The stock does drop a little to $54 then in the space of a few days charges back up to $65.
You can't bring your-self to buy higher as you had banked on getting in much lower.
So you pass it by.
You watch ABC stock as it climbs to $100.
Now you are bitter and angry.
"No way am I going to touch that stock again.
Lousy stock wouldn't let me get in at $50.
" It does correct again for a few weeks touching $80.
You feel a bit better now.
Then again it takes off and hits a high of $150.
You curse and swear.
Vowing never to make the same mistake again.
You cannot time every twist and turn in a stocks trend.
It's a valuable lesson I learned many years ago.
It's best once you are in to try and ride put the correction and get out when it is finally over.
Hold on for the big moves instead of trying to trad each smaller move.
Yes, it's easier said than done.
What sounds simple isn't that easy to do in real life trading when it's your money on the table.
BUT, that's what separates the "also rans" from the top traders.
Most people think shorter term trading beats longer term "trading".
But that's not what I have found.
I have come across long term investors (1 year+) who make millions.
Compared to day traders who are happy to scrape out a few thousand dollars a month.
(IF hey are very good).
As Jesse Livermore said "The big money is made from the big moves.
Not the small day to day gyrations.
" Obtaining outstanding stock market % returns can be achieved in one of two ways.
And it is only these two ways.
1) Trade more often 2) Trade with bigger size.
Some day traders.
swing traders can make great % returns.
But I am telling you now you are at a severe disadvantage here.
Many day traders are limited in the size they an trade.
AND hey have to watch the markets every day.
Ask if this is how you want to spend the rest of your "career"? Swing trading too can be lucrative but I have to ask why make it such hard work? Why try and "super time" each stock cycle when there is more profit, less stress, going with the longer term trends? Doesn't make sense to me.
I guess there are easy or hard ways to make money and you have work out which one is which.
Trade with bigger size simply means stop trading like a Mutual Fund.
Experiments have been conducted in the stock market to show that if you hold more than 10 stocks all you are doing is mirroring what the averages will do.
i.
e you cannot make more than what the averages are going to do.
What you must do is focus on say 3-5 stocks.
WAIT.
Be patient.
And trade each stocks as and when it tells you to for maximum gains.
Bet big when the odds are 70%+ in you favour of a big move.
I am not saying for one minute I am right all he time.
You don't have to be.
Make sure you make big money when you are right and your losses are relatively smaller when you are wrong.
Presto.
you are making fantastic gains.
going away on a world cruise for 9 months.
Coming back and it is at $300+? Many fortunes have been made by complete stock markt novics because they got lucky and did not try to over-trade.
For example, let's say ABC stock lashes a buy at $30.
You buy and 3 months later it is at $50.
You think great I am up 66% I am going to sell and re-buy (or even worse short what you consider a temporary top.
).
You sell out and wait.
The stock does drop a little to $54 then in the space of a few days charges back up to $65.
You can't bring your-self to buy higher as you had banked on getting in much lower.
So you pass it by.
You watch ABC stock as it climbs to $100.
Now you are bitter and angry.
"No way am I going to touch that stock again.
Lousy stock wouldn't let me get in at $50.
" It does correct again for a few weeks touching $80.
You feel a bit better now.
Then again it takes off and hits a high of $150.
You curse and swear.
Vowing never to make the same mistake again.
You cannot time every twist and turn in a stocks trend.
It's a valuable lesson I learned many years ago.
It's best once you are in to try and ride put the correction and get out when it is finally over.
Hold on for the big moves instead of trying to trad each smaller move.
Yes, it's easier said than done.
What sounds simple isn't that easy to do in real life trading when it's your money on the table.
BUT, that's what separates the "also rans" from the top traders.
Most people think shorter term trading beats longer term "trading".
But that's not what I have found.
I have come across long term investors (1 year+) who make millions.
Compared to day traders who are happy to scrape out a few thousand dollars a month.
(IF hey are very good).
As Jesse Livermore said "The big money is made from the big moves.
Not the small day to day gyrations.
" Obtaining outstanding stock market % returns can be achieved in one of two ways.
And it is only these two ways.
1) Trade more often 2) Trade with bigger size.
Some day traders.
swing traders can make great % returns.
But I am telling you now you are at a severe disadvantage here.
Many day traders are limited in the size they an trade.
AND hey have to watch the markets every day.
Ask if this is how you want to spend the rest of your "career"? Swing trading too can be lucrative but I have to ask why make it such hard work? Why try and "super time" each stock cycle when there is more profit, less stress, going with the longer term trends? Doesn't make sense to me.
I guess there are easy or hard ways to make money and you have work out which one is which.
Trade with bigger size simply means stop trading like a Mutual Fund.
Experiments have been conducted in the stock market to show that if you hold more than 10 stocks all you are doing is mirroring what the averages will do.
i.
e you cannot make more than what the averages are going to do.
What you must do is focus on say 3-5 stocks.
WAIT.
Be patient.
And trade each stocks as and when it tells you to for maximum gains.
Bet big when the odds are 70%+ in you favour of a big move.
I am not saying for one minute I am right all he time.
You don't have to be.
Make sure you make big money when you are right and your losses are relatively smaller when you are wrong.
Presto.
you are making fantastic gains.
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