Students are always asking me how I’ve managed to last so long as a professional trader.
When I look back on my career, I’m most proud of my longevity.
I’m not a gunslinger, I don’t usually bag massive six-figure wins, and I don’t take big risks.
My trading journey has been a challenging grind-up as opposed to a massive momentum surge.
But these are the exact reasons why I’ve been able to make nearly $4 million in trading profits over more than a decade.
I’m disciplined and patient. But most of all … I’m consistent.
It’s taken years of practice and studying to figure out what works for me. And after so much time in the markets, I’ve realized that I value a long and fruitful career over any individual period of money-making or trading success.
So, Evolvers, I’m here today to tell you to prioritize the same things.
Your goal should be a long time in the markets, not timing the markets.
With that in mind, here are a few pieces of advice I can provide to help lead you toward a long trading career…
Perfect Your Position Sizing
Typically, newbie traders struggle with the volatility in the stock market. They need to limit their risk by taking fairly small position sizes. This is how they get accustomed to price movements and grow their small accounts gradually.
Eventually, though, you’ll have to learn to scale and increase your position sizes. Starting with small positions allows you to learn the setups that work for you. And it can help you gain confidence.
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When you’re ready, the next step is to take advantage of opportunities to grow your account with larger positions.
This is where a lot of traders get stuck — because they don’t scale correctly. Whether it’s a multi-day breakout in a hot sector or shorting a first red day, you have to get more aggressive on patterns that have a good risk/reward or you’ll never grow your account significantly.
When you see the patterns happen over and over again, it’ll help you get more comfortable so that you can push on the trading gas pedal when you need to.
Losses = Lessons
As a trader, you have to accept the fact that there will be times in your career when you’re just completely wrong about a setup.
And when you’re wrong in the stock market, that usually means losing some money. It’s an unavoidable part of the game.
Even the best setups won’t work every time. Sometimes you’ll buy a failed breakout or failed breakdown, other times an unpredictable headline will reverse the direction of the stock you’re trading.
Take me as an example. By all measurable metrics, I’m a very successful trader. But I still make regrettable trades from time to time.
When that happens, stay disciplined and cut your losses immediately. Then, do some serious self-reflection about what you could’ve done better.
Any time I find myself regretting a trade, I ask myself … what valuable lessons can I take away from this loss?
Practice Makes Perfect
You have to learn to identify pivotal entry points on charts and recognize whether they warrant an aggressive position.
I tend to get more aggressive on the short side. It’s what I feel comfortable with. But why?
Because we never really know how high a stock can go. On the other hand, when momentum stocks reverse, they’re almost always going to have a sharp pullback on that first red day.
Finding your ‘bread and butter’ setups takes time and experience. As a newbie, I used to get overly aggressive, causing my account to take big drawdowns.
I’d string together a few modest wins but then I’d get overconfident and too aggressive. I’d maybe short a bounce too early and end up losing a significant amount of my previous wins.
Back then, I took two steps forward, then one step back.
Luckily, it wasn’t long before I discovered Tim Sykes’ Trading Challenge. That’s where I learned how to get aggressive on certain chart patterns and conservative on others.
If you wanna learn to trade the way I did, I suggest starting right here.
And once you master the discipline to wait for perfect setups, you’ll find yourself making massive strides forward … with only the occasional setback.
Adapt to Any Market Conditions
An important part of being a successful trader is learning to adapt to anything the market throws at you. And this is more true than ever in 2022, considering the price action in the markets over the past few months.
If you wanna win in the stock market, be ready to adjust your strategy WHENEVER necessary.
In other words, you must be nimble. Be ready to shift your setups, your patterns — and most of all, your mindset — any time the market changes pace.
Trust me, this is a lot easier said than done. (I’m sure a lot of you realized this back in November 2021, when the bull market first started rolling over.)
Take the shifting economic tides as a blessing in disguise.
If you’ve made it this far trading in 2022, you’ve adapted quite a bit already.
I know it’s been a tough year so far, but you’ve learned an indispensable skill. Stick with it.
Now you know my trading secrets. No, this isn’t rocket science. But long-term trading success is challenging to accomplish. It takes tons of patience and years of studying.
So, spend some time getting to know which patterns work for you and then search diligently for those patterns.
Then, when you find them, practice entering at the right time and level so that you can improve your risk/reward.
Trust me … with practice, discipline, and consistency … you can ‘make it’ as a trader.