Trading stocks for a living, following a trading system

Following a trading system is on the one hand the easiest thing a trader can do and on the other hand it becomes an almost impossible task for most traders. In reality, few traders can follow a trading system. I have met hundreds, maybe a thousand traders, some of whom were positively brilliant, and I will tell you that very few could follow a system.

I am not sure why this is so. Before I became a trader, I was a psychologist and naturally I am interested in the psychology of trading. However, I have yet to develop a clear explanation of why smart people cannot follow a trading system.

I post my trades and positions several times a day on my website. Anyone can see that I have good and bad days. But overall, my returns are excellent and actually far outperform most professional traders.

I have also shown that this methodology has been working for over twenty years and that I have traded it with accounts ranging in size from $ 6,000 to $ 6,000,000. Using this methodology, anyone, in my opinion, with 10 to 20 thousand dollars has the potential to earn hundreds of thousands even millions of dollars if they simply follow a good system for several years.

This is what I recommend you do to become a millionaire:

1) Open a trading account with a discount broker with ten to twenty thousand dollars.

2) Sit in front of computers for almost eight hours a day for each day the markets are open. Plan to do this for five to eight years.

3) Get a good short term system that you have tested with lots of data. Do exactly what the computer tells you to do. Buy when the computer says buy and sell when the computer says sell.

4) Keep careful business records and strive to improve your order execution skills.

5) Pay your taxes on time.

In theory, the worst case scenario is that it will take you eight years to become a millionaire. This is not a bad salary for five to eight years of work.

So why can’t people do this? Why can’t people follow a simple system for several years to earn a million dollars?

Well, like I said, I’m a psychologist AND a trader. I have also come into contact with hundreds of merchants. Unfortunately though, the portrait of the AVERAGE trader I have met is not very flattering.

Based on my contacts and experience, this is why you probably won’t be able to follow the five steps above to reach a million dollars:

1) Boredom – Becoming a professional trader can be disappointing. Most people think of trading as very exciting. It is not. The truth is that markets tend to move sideways about 85% of the time and that’s not very exciting.

Also, I get around 60% of my profits from 5% of my trades. What that means is that I take a lot of mediocre trades while waiting for the big one. Trading is like fishing and sometimes requires a lot of patience.

I think that a good trader has a personality a bit like the personality of an accountant. But not many people who are drawn to trading have personalities like an accountant. They tend to be strong thrill seekers and thrill seekers quickly become disillusioned with my trading style.

2) Desire for change – Earning a million dollars with MY systems and methods requires you to do the exact same thing day after day for several years. Most people cannot do that. People naturally want to stimulate themselves, perhaps in reaction to boredom, through change. Often times this can come in the form of changing business systems.

I have met many people in this business and some of them have treated me with some contempt simply because I continue to operate in the same way that I did 20 years ago. Even though I have made a lot of money doing this, they feel that I suffer from some kind of intellectual disability because I have not developed something new.

But my experience is that system changers lose money faster than anyone else.

3) Negative Life Events: When I suggest to people that they can earn money by staying home and doing something that is no more difficult than performing operations that their computer tells them to do, their eyes light up and they think that perhaps they have found the key to happiness. But trading can cause emotional problems that can lead to depression, anxiety, divorce, and despair.

When I really quit my day job and started operating full time, I initially felt very isolated and missed seeing my friends at work. At first I felt deeply alone and isolated.

Having a busy and worried dad at home all the time can also cause stress in families. And even making a lot of money in the markets can put stress on families. If you go from being poor to rich, your relationships will surely change and changes are not always for the better.

Good trading demands stability and consistency, but going around with $ 100,000 in your checking account can undermine that.

4) Negative Psychiatric Programming – Running a website and selling business software and advice helps reduce my sense of isolation that comes from working at home all the time. Although some of my best friends and business contacts started out as my clients, this business has also put me in touch with some of the strangest people on the planet.

Two of the most interesting stories:

Hobo John was literally homeless and called me frequently from phone booths. Fifteen years ago he raised a few thousand dollars, probably selling drugs, and paid me $ 1,150 for my business package and used the balance to open a business account. What he got from my trading materials was that if you were to invest in the stock market you would get rich.

The guy bought a stock index contract and held it until all his money ran out. I was almost glad when that happened because he had been calling me every day from a phone booth to report the progressive decline in his account.

Millionaire Mike had all the family money anyone could want and he had never had an honest day at work in his life. He barely knew how to turn on a computer and he wouldn’t be able to follow my system if his life depended on it.

He lost large amounts of money on a daily basis and this did not seem to bother him at all. He spoke to me like I was his best friend and, like Hobo John, called me every day to cheerfully report his losses.

His marriage was in trouble and, curiously, he talked to me about buying gold and burying it on public land to hide it from his wife. The phone calls mercifully ended their divorce.

I am absolutely convinced that some confused people get into trading because they want to punish themselves and want to lose money.

In any case, there are many reasons why people cannot sit in front of a computer, at home, for several years to earn a million dollars. Following a trading system can be easy or nearly impossible, depending on how you want to view it. But if you really think you can have the right stuff and can avoid some of the pitfalls I’ve outlined here, I suggest you give it a try.