Following a trading system is, on the one hand, the easiest thing an operator can do and, on the other hand, it becomes an almost impossible task for most operators. In truth, few traders can follow a trading system. I have met hundreds, maybe thousands, of traders, some who 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 merchant, I was a psychologist and naturally I am interested in the psychology of commerce. 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 days and bad days. But overall, my earnings are excellent and in fact far exceed the performance of most professional traders.
I have also shown that this methodology has been working for over twenty years and that I have changed it with accounts ranging in size from $ 6,000 to $ 6,000,000. Using this methodology, anyone, in my opinion, with $ 10-20,000 has the potential to earn hundreds of thousands, even millions of dollars if they just follow a good system for several years.
Here’s what I recommend you do to become a millionaire:
1) Open a business account with a discount broker with ten to twenty thousand dollars.
2) Sit in front of computers for almost eight hours a day for every day that markets are open. Plan to do this for five to eight years.
3) Get a good short term system that you have tried with lots of data. Do exactly what the computer tells you to do. Buy when the computer says to buy and sell when the computer says to 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 or 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, as I said, I am a psychologist and a merchant. I have also contacted hundreds of merchants. Unfortunately, however, the AVERAGE trader portrait 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 above five steps to get a million bucks:
1) Boredom: Becoming a professional trader can be disappointing. Most people think that trading is very exciting. It is not. The truth is, markets tend to move laterally about 85% of the time, so it’s not very exciting.
Also, I make around 60% of my earnings from 5% of my trades. What that means is that I take a lot of mediocre exchanges while waiting for the big one. Trading is like fishing and sometimes requires a lot of patience.
I think a good merchant has a personality a bit like the personality of an accountant. But not many people who are attracted to the trade have personalities like an accountant. They tend to be thrill seekers and thrill seekers are quickly disillusioned with my trading style.
2) Desire for change: Earning a million dollars using MY systems and methods requires you to do exactly the 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 this can come in the form of trading systems change.
I have met many people in this business and some of them have treated me with a certain amount of contempt simply because I continue to trade the same way as I did 20 years ago. Although 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 switches lose money faster than anyone.
3) Negative life events: When I suggest to people that they can make money by staying home and doing something no more difficult than taking the operations that their computer tells them to take, their eyes light up and they think that maybe 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, initially I felt very isolated and missed seeing my friends at work. Initially I felt deeply lonely and isolated.
Having a busy and somewhat worried dad at home all the time can also cause stress for families. And even making a lot of money in the markets can stress families. If you go from poor to rich, your relationships will surely change, and the changes are not always for the best.
Good trading requires stability and consistency, but walking with $ 100,000 in your checking account can undermine that.
4) Negative Psychiatric Programming: Running a website and selling software and trading tips 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 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 the phone booths. Fifteen years ago he raised a few thousand dollars, probably selling drugs, and paid me $ 1,150 for my trading package and used the balance to open a trading account. What you got from my trading materials was that if you 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 happy 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 had never had an honest day of work in his life. He barely knew how to turn on a computer and couldn’t follow my system if his life depended on it.
He wasted large amounts of money on a daily basis and this did not seem to bother him at all. He spoke to me as if he were his best friend and, like Hobo John, he called me every day to cheerfully report his losses.
His marriage was in trouble and curiously he was telling me about buying gold and burying it on public land so that he would not hide it from his wife. The phone calls mercifully ended her divorce.
I am absolutely convinced that some confused people mix with commerce because they want to punish themselves and they want to lose money.
In any case, there are many reasons why people can’t sit in front of a computer at home for several years to earn a million dollars. Following a trading system can be easy or almost impossible depending on how you want to see it. But if you really think you could have the right things and can avoid some of the pitfalls I’ve described here, I suggest you give it a try.
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