I remember it like it was yesterday…
When I was a newbie, I had a major problem: taking two steps forward and one step back. After nailing a big win, I would feel overconfident and then give the gains back to the market over the following few trades.
If you have this problem, listen…
There were a variety of lessons, tips, and skills that allowed me to put those problems behind me and become the multi-millionaire trader I am today.
I feel like a broken record sometimes, giving the same pieces of trading advice over and over.
But I do this for a good reason — you need to not only hear these things, but drill them into your psyche.
In that spirit, today I’d like to give you a lightning round of trading advice that’s helped me beat the market for over a decade.
Keep reading and I’ll show you…
Identify your strengths and weaknesses…
Most traders aren’t identifying what they’re doing wrong. Newer trades especially tend to have a difficult time identifying their weaknesses. The sooner you can break out of this trap, the better. And one way to potentially do this is to…
Check yourself before you wreck yourself…
Go through your trades meticulously. You should be constantly self-evaluating your performance, looking for ways to improve. Here’s an easy way to track your trades…
Keep a trading journal…
Keeping a trading journal is the best way to track your trades. After you’ve entered your trades consistently for a few months, you’ll be able to see trends in your successes … and your failures. Over time you’ll get a better understanding of how different factors affect the ultimate outcomes of your trade decisions…
Play into your strengths…
Concentrate on what you’re good at. Your strengths may be different than mine. A critical part of every trader’s journey is finding the setups that work for them. Then, you must focus your energy and capital on those exact setups.
Play both sides of the chart…
The best traders can take opportunities both ways, long or short, puts or calls. By being a perma-bull or perma-bear, you limit your ability to trade the wide variety of setups available in the options market. A broken clock may be right twice a day, but it’s wrong for the other 23 hours and 58 minutes. Be flexible in trading either side of volatile charts and a whole world of new patterns will open up to you (that you might not have seen prior).
Expand your ‘tool belt’…
Expanding on this, the more tools you can master in your trader’s tool belt, the more opportunities you can potentially capitalize on. Look at me — I trade penny stocks, large-cap equities, options, puts, calls, long, short … whatever the moment calls for!
Are you familiar with this trading “loophole?”
Are you familiar with the “loophole” that helps small accounts grow exponentially?
No, it doesn’t have anything to do with penny stocks or crypto…
And this strategy works regardless of whether the markets are up OR down…
This little-known options “loophole” is something you can use to grow your trading account right now…
Treat every trade equally…
I spoke earlier about my newbie tendency to give back after big wins. I took a major step toward curing this problem when I began treating every trade equally. I don’t mean I trade everything the same … I mean I don’t overvalue one play over another. I do my best to avoid overconfidence after big wins and shattered confidence after stinging losses. I’m human, so I’m not perfect at this, but I’m certainly more controlled in my confidence than I was as a newbie.
Trade one day at a time…
Just as you should treat every trade equally, you should treat every day equally. Remember that each trading session is its own unique opportunity for trades. Take your trading one day at a time. Don’t let what happened yesterday — or what may happen tomorrow — cloud your near-term judgement.
Most setups aren’t tradeable…
The vast majority of setups in the market are simply not tradeable. Ask yourself … What’s the risk/reward? Is there enough upside or downside in the chart to make it worth the risk?
Singles add up…
Always know the risk/reward of your trade before you enter. I don’t have a huge appetite for risk and I’ve still made $4 million+ trading. Don’t think you need to hit home runs to have extraordinary results. Singles add up.
Opportunity cost matters
Don’t overlook opportunity cost – the loss of potential gain by being tied up in subpar trades. This is especially true for small-account traders who can only afford to be in a few plays at a time … make them count!
Trade like you’re retired…
On the same token, if you think you need to make a trade every single day … you’re wrong. And worse, you’re probably overtrading. As my mentor Tim Sykes says, trade like you’re retired!
Time of day matters…
Don’t overlook when in the trading day you’re executing your entries and exits. Personally, I find myself leaning toward put trades on the morning flushes and call trades into afternoon ramps — but there’s no hard-and-fast rule about this.
Slow and steady wins the race…
Trading is a marathon, not a sprint. You have your entire life to build your strategy, skills, and account size. I think one of my greatest strengths is my conservative nature. Don’t rush your journey and don’t force trades!
Final Thoughts
I hope these lessons help you avoid some of the mistakes I made early on.
I wish I’d had this advice when I was at your stage in my trading journey.
Any time you’re struggling to perform your best, reference this list to make sure you’re not missing any of these crucial components.
