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Put yourself as a corollary to yesterday’s episode. Put yourself in the mindset of financial abundance, right? You have to have a financial growth mindset. And so I think if you’re looking at the screen all day, it puts you in a state of fear and a state of shock because the markets can move quickly. And again, the best thing that you can do is to stay out of your own way, especially at the beginning. You can’t really steer stuff. Another comment came in on this video that I did called “What’s Better – Trading the Chart or trading the Crowd,” and he says, when you say you really need just one good trade to make a year, is that the realm of futures? Equities don’t seem to appreciate that much.
I mean, besides Nvidia, I mean, I don’t want to sound like a smart ass, but there’s ETFs, ETPs exchange traded products, there’s all kinds of things that you can get your hands onto, and the way you make money is really one of two ways. You have a small position that makes a big move or a big position that makes a small move. I don’t want to sit there and make nickels and dimes every day trying to day trade. I would much rather have all my winners show up in like say, I don’t know. I didn’t look at the data, but maybe 30 to 60 days of the entire 250 days. So call it 50 days, 20%. There’s 250 trading days in the year, and I could probably look at all my gains and estimate that they probably happen within 50 days. The rest of the time it’s like you’re getting in and you’re getting stopped out.
It’s all this kind of treading water stuff, and that’s just how it goes. We’re all participants within the randomness of insecurities prices in the short run. And so I guess the question is, there’s a big difference between when they say, don’t let a trade become an investment. I disagree with that. I think that’s bullshit. That’s amateur talk. Where it applies is when you’re in a trade, like one of the darlings, like the Bitcoin or Nvidia, for example, and it moves against you when you start adjusting your stop, but we’ve spoken specifically about that emotional error. But if you’re in a winning trade, whether it’s, and I don’t care if you’re a day trader or a scalper, your goal is to hold it for as long as possible. There’s nothing wrong with risk. If you’re in a trade and you’re long and it’s going up, to me, that’s now branded a good risk.
You can’t look at fire and say all fire is bad if it’s left unchecked or if you keep feeding it fuel, it can grow unwieldy. That’s leverage. So your job is to manage your leverage, right? I always said that we make and lose our money from our position sizing. So if you’re not making enough money on the equity runs, you might be not risking enough. It is possible that traders have too little risk. And so why I think that don’t let a trade become an investment. If you held your Nvidia trade for two or three months, there’s nothing wrong with that. That doesn’t necessarily make it an investment. That’s you letting the trend unfold and you staying with your winners for as long as you possibly can, which is what you should do. And in my opinion, those bigger wins, they pay for all the losers and then some, right?
So again, what is your goal? No one should put on. It’s the first thing we do in the coaching is we discuss what’s the goal? And when you ask people that, they’re like, well, wait a minute. It’s like, well, what business is that of yours? And it’s like, well, it’s none of my business really. But if you don’t know and if you can’t articulate it in one freaking sentence, you don’t know what you’re doing because otherwise, why would you even engage in trading? There’s a big aha moment for you. You’re looking for action. You want to call yourself a traitor. Do you want to look like a cop or you don’t want to be a cop?
We deal with deception. We don’t deal with self-deception. So in the goal setting, you kind of have to understand that if intentions equal results, a lot of times your subconscious is going to be really driving the show here. So when you say, I want to make a million dollars, I’m like, no, you don’t. You really don’t know the first thing about that. There’s no emotional connection to it. It’s just the number that you pulled out of your ass. Like, I wanted to quit drinking with my New Year’s resolution. I don’t drink. I’m just saying hypothetical New Year’s resolutions. There’s no emotional connection to that. It looks like an ideal, but you have to put the work in to really understand what that means. What are you willing to do? Most people don’t have it. Most traders don’t have it. Forget people in generally, most traders don’t have what it takes.
That’s why so many fail. They look at it and they’re like, oh yeah, you just have to buy and sell crap. But there’s so much more to it. So in order to have the financial growth mindset, you have to put yourself in the mindset that your capital is going to grow and it doesn’t grow because you’re looking at it, right? I would look at it like gardening. You plant a bunch of seeds, make sure there’s moisture and fertilizer, and then leave it alone. We don’t check it every day for some reason. Some of you feel like success, it comes and it goes too quickly. That’s just not how it works. You can catch some of these bigger moves and stay with them for as long as possible, but you have to be open to it mentally. If you don’t think it exists, then for me, I don’t know what to tell you.
You’ve missed out on some very, very large moves. And if you’ve pulled 50 bucks out of Nvidia, that’s not a winning situation. You can feel good about what you did, but you’ve left the majority of the money on the table. So you have to figure out what are you doing this for? The market isn’t so risky that you have to always remove your risk as fast as you have a gain. Most of you have that hair trigger response. I know guys are a little sensitive to that, but it’s really the same thing. You get a little bit of a game, taking it off, can’t go broke, taking gains. But the truth is, is that you really do go broke because you’re going to lose more money. You’re going to lose more frequently than you’re going to win. So if you take consistent, I actually did a video on this, you can go look it up on the channel. The problem with taking small consistent wins, you’re just never going to grow. So again, financial abundance, financial mindset. What is it that you’re trying to do with your money? Right? I like to tell people, no matter what your account is, you should start to think about having winners that have commas in them.
I know that sounds kind of tongue in cheek, but that’s what you should be looking for because that’s how you really change your life. And even if you want to be a scalper, you can hold onto things longer in the beginning of your career, overnight over the weekend so that you can grow your account so that when you scalp, you’re not scalping with 5K, you’re scalping with a hundred K. That’s a whole different game. It’s a lot easier and probably more fun for you if you’re trading for pleasure to scalp when you have a larger account. But scalping with a small account is going to keep you small. There’s just no way handful of people can do it. Most can’t. And that’s where you have to be brutally honest with yourself, because again, if you don’t have a goal to grow your financial abundance, you’re going to find yourself doing small-minded things. You have to think bigger. You have to envision those bigger gains and then adopt your behavior to stay in harm’s way when things are going good. You see?
Because the more time that you put in the market that way, and the more time you hold the position, the more money you’re going to make, right? It’s a popular delusion to think like, Nope, as soon as I get up X amount, I got to take the risk off. Because the only thing that can happen at that point is it goes away. And I don’t know where that logic comes from because the whole world is full of rich investors who bought McDonald’s in 1998 and held it, and they made a lot of money. And so I think traders, especially those who were trying their hand at the short term of things is study investors. And what did they go through to make their money as investors? What was so hard about what they did about buying quality things and holding it? Are you not going to ever make any more income? And did you do the exercise that I suggested where you actually looked at the moves and the prices and put it on a spreadsheet like I did in the livestream, replay, mark everything to the market and see what would’ve happened to your money. And then ask yourself, how would you have felt that those key inflection points, because I think people have an irrational fear about overnight risk and not letting their money really grow up. They’re kind of constantly truncating their wins,
Which is the majority of the emails that I get from people is like, I don’t know how to do it. I see again, and I panic. What happens there? What happens when you’re up a couple hundred bucks? You put on a trade and very quickly you’re up. What’s so shocking about that? So again, I ask you, what did you think was going to happen and why does making money make you so afraid that you have to cut off the very channel that’s trying to give you abundance?
And why is your work ethic such that you want to recreate yourself every day when you were already in a winning trade the previous day or the previous week, and now you’re watching it continue to go up and you’re not participating it in it? So those are things that you have to conjugate, marry your behavior with your belief, right? The fancy word is praxis, but it’s marrying your belief with your behavior. And so that comes down to me. It comes down to goal setting. How do you want trading to serve you? Do you want to be right or do you want to make money? Because there’s different behavior tied into that. In my experience, the models that have high accuracy have much lower expected values. The ones that have lower winning percentages have higher expected value. And I think your goal as a trader, again, people say, well, if you’re not studying charts, what are you looking at? You’re looking at the data. This is what I’m looking at. Your goal should be to increase the expected value of a trade, which is a weighted average of sorts. What do you make on average every time you put on a trade?
So check out the live stream.

The post Developing your trader growth mindset first appeared on MartinKronicle.

The post Developing your trader growth mindset appeared first on MartinKronicle.