Over my many years of trading, I’ve learned a lot of difficult lessons.

Look…

The stock market is full of bitter pills to swallow.

So, today, I’m not gonna sugarcoat it…

I’ll tell you about some difficult realities I’ve had to overcome as a trader so that you aren’t caught off-guard when you inevitably face them yourself.

Then, I’ll show you some simple solutions that have helped me work through these unavoidable truths. 

Keep reading and I’ll show you…

Anyone Can Get Lucky (But Few Can Develop a Repeatable Strategy)…

When reflecting on my career, I think developing a repeatable strategy (that I could use over and over again) was one of the most critical steps I took.

Listen…

Anyone can have a lucky streak in the stock market. 

Even the most clueless of newbies could stumble into a prolonged series of big wins … accidentally.

Sure, it’s unlikely to happen to you. But with so many trades happening all the time, odds dictate that these scenarios happen more often than you might think.

All this to say, don’t get ahead of yourself after stringing a few winning trades together.

This doesn’t mean you have a repeatable strategy. It’s very possible that you simply got lucky. 

I didn’t just use my strategy on a handful of trades and suddenly decide I was unbeatable in the stock market.

I applied my options-trading strategy to hundreds of different setups and won on the vast majority of them. 

An important part of developing a repeatable strategy is learning your favorite chart patterns.

After all, patterns get their name because they repeat. 

If you learn how to identify and trade specific patterns, you can start building a repeatable strategy simply by executing them. 

Forget About Instant Gratification (Do the Hard Work)…

It’s no secret that we’re living in a generation of instant gratification…

• You can post a picture on social media and immediately get likes.
• You can order food and have it arrive at your doorstep in under an hour. 
• You can open a streaming service and see tens of thousands of movies and shows at your fingertips ready to instantly play.

But the stock market doesn’t work like social media, food delivery, or streaming television. 

You have to truly dedicate yourself to mastering the art of trading if you want to eventually reach a level of consistent profitability. 

WARNING: If you want instant gratification, trading probably isn’t ideal for you. 

I think the temptation toward instant gratification is one of the primary reasons why so many would-be traders fail.

The attributes necessary for being a successful trader are in direct conflict with the global mindset at the moment. 

Some newbies see the success of others and want it immediately for themselves.

But they don’t consider all the blood, sweat, and tears that go into professional trading…

Bottom line: Most people want success NOW — while few are willing to put in the years of work it requires. 

A lot of would-be traders fail the moment they realize how much work it’s going to take to succeed. 

If you’re willing to do the hard work that others aren’t, you could potentially find major success in the stock market. 

Losses Are Inevitable (But There’s a Simple Way to Minimize Them)…

Even the world’s most masterful traders eventually get smacked with brutal losses.

No one is correct about anything 100% of the time, and traders in the stock market are no exception…

There’s no such thing as a bulletproof vest for traders. You’ve gotta be able to take the occasional hit, get back up, and keep going. 

That said, there’s a simple way to help you avoid disaster — determine the maximum amount you’re willing to lose on a given trade.

I can’t do this part for you. Your maximum loss tolerance will depend entirely on your personality, account size, and overall risk tolerance.

But I can tell you what works for me… 

At this stage in my trading journey, I try to NEVER risk more than 1% of my account in a day. 

Keep in mind that I have over $4 million in trading profits. My maximum loss tolerance tends to land in the $20,000–$30,000 range.

Note that this is a MAXIMUM number. I try to not lose this much on a single trade. 

Bottom line: I think 1% overall account risk is a decent starting point for most active traders

That said, if you’re trading a small account, you may be forced to risk far more than 1% in the early days. 

In my last small account challenge, I took much larger risks relative to the account size for this exact reason. 

The key in these situations is to be incredibly discerning with the trades you put on. 

Then, once you’ve grown your account to a size that gives you some breathing room, you can return to a much smaller risk profile. 

Final Thoughts

The world of trading is filled with valuable yet challenging lessons.

Learn them now so that you aren’t forced to face them during active trading.

By embracing these difficult realities now and committing to learning their solutions, you have the potential to get ahead of your competition in a meaningful way.