By far one of the hardest things to do as a trader or investor is to follow the rules. Assuming you’ve traded before, I’m sure you can relate to just how hard it can be when real money is on the line. Our guest, Ben, has a great story he shares with us which finds a centralized theme in following the rules vs. not following them. Ben’s journey took him to the edge of almost wanting to give up on trading, but he then discovered another area of the market that re-energized his passion and drive to succeed. After adding in more tools to his toolblet, adhering to the rules and risk management systems became easier and easier. There is no question in my mind that there is at least a few things that we can all relate to in Ben’s story.
Ben’s dad was always interested in economics and the importance of savings. This was something that was taught to Ben at a very young age.
While he was deployed overseas, since the market opened up in the afternoon and some other members of his company were trading, Ben started to get involved in long term investments in names he knew. This was unfortunately timed during the market collapse of 2008.
Lots of gains can be made in the sub-penny market, however, after he looked into some of the companies, Ben recognized that most of the names moved based on hype versus actual performance or products.
While Ben had transitioned back to civilian life, he did start trading after taking Robotic Trading but it became quite clear to him that he didn’t have a clear view of the whole trading process yet. This led him to Claytrader University to learn how to apply all the pieces of puzzle.
Ben thought about giving up on trading. He was slightly jaded at these low price low volume stocks but after learning about options, this opened up his opportunities to trade larger and more stable names.
A big turning point for him was waiting for a chart pattern to really leap out at him versus just making a pattern out of nothing. Adhering to his risk management principles, this gives him further hope of becoming a full time trader in the future. Right now, trading is supplemental income for him and his family. Good habits can scale which is what he is focusing on.
One of the guys was big into penny stocks. I was trying to stick with names that I knew. All well known companies.
In hindsight, what are you thinking? This isn’t just a bad choice… it’s a very bad choice. (regarding sub-penny stocks)
I was up about 20k on a 4-5 thousand dollar investment. Long story short, I broke even.
I was putting a lot of pressure on myself to try to be successful without having the capital or understanding clearly what to do.
I was kind of ready to give up the whole trading idea. Options can be very profitable if you are disciplined.
The chart showed itself and I followed the principles which led to a very successful trade.
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