Dear 10-Minute Millionaire Reader,
For many traders, this summer has been extremely stressful. It’s easy to see why. With markets up-and-down and up-and-down from one day to another, swinging 800 points in one direction and then another, it’s hard to keep your cool.
Here is a chart of the S&P 500 over the last month that illustrates the wild ride the market has been on…
I’m often asked in such volatile times, “How do know when to get in and out of trades with the market bouncing around so much?”
With such extreme intra-day price movements, a person could drive themselves crazy constantly watching prices zigzag up and down, trying to quickly determine when to buy and sell.
But 10-Minute Millionaire Insider traders and inverstors know that acting on impulse is the absolute worst thing you can do, both for your money and for your stress levels.
When the markets are volatile and every fiber of your being is pushing you to do something, anything – that’s exactly the time when sticking to our plan – our system – is the most important.
If you’re not already an Insider, click here to learn how you can get a copy of my book, The 10-Minute Millionaire, in which I break down my easy-to-follow three-step system that has helped thousands of readers to identify trade opportunities with higher probability of success, limit their downside risk, and effectively manage their portfolios for long-term success.
Now, let’s take a look at some of the extraordinary benefits of system trading…
Stick to the System
A “systems” approach to investing will beat a “seat-of-the-pants” approach to investing any day of the week and twice on Sundays for specific – and very definable – reasons. Here are two reasons why a systematic approach is superior:
It is Emotionless: On any trading journey, emotions are nice companions, but lousy guides. We all want to we can make trading decisions based on facts and data – and can leave emotion out of the trading equation.
But you and I both know from the irrational nature of the financial markets (remember Fed Chair Alan Greenspan’s reference to “irrational exuberance?”) that investment decisions are anything but rational. That’s why people get crazy and drive stocks or whole markets to extremes.
One of the biggest ways this shows up in traders (especially new traders) is that they treat every trade as “make-or-break.” For instance, when a trade becomes a loser (even a tiny loser), instead of selling when your predefined “get out point” or stop loss is hit and then moving on to the next opportunity, the trader holds on in hopes of a rebound. The small loss snowballs into a bigger loss.
And when the markets are swinging wildly, as they have been this summer, the risk that (without a plan), your small losses will snowball into larger ones is even larger than usual.
In other situations, when a trader has a small profit – but sees a small reversal – emotion drives him or her to cash out to “keep” the gain… even though their probability analysis shows that a huge profit is attainable.
For us traders, a system removes emotion and allows us to approach each trade as part of a larger whole. It also helps us treat the trade from a probability standpoint. Your mindset should sound something like, “There’s a 70% chance of a win here, but if the 30% scenario plays out, and I incur a small loss, I’m okay with that because I know I can move on.”
Remember the analysis that you made before you entered the trade, what I sometimes call Framing the Trade. That cold, analytical look at the numbers tells you what to do once the trade is live – and it does so without putting emotion into the mix. Let those numbers guide you.
The takeaway here is simple: stick to our system. Especially when you feel like you shouldn’t. That’s what it’s there for.
There’s another benefit to doing that…
Being Efficient Couldn’t be Easier
Sticking to our system is efficient: The essence of a system is that it lets us break a decision down into its fewest pieces. The result is that you spend your time planning and preparing up front – meaning the day-to-day executions can be quick and decisive.
Efficient action is at the core of what we do here in 10-Minute Millionaire. We have a system that works, that takes guess-work and pondering out of our trading decisions. Already knowing what to do once your trade is live saves you valuable time and money, letting you actually enjoy your winnings.
Speaking of winnings…
There’s Only One Way to Repeatedly Win at Trading
Playing the lottery can be fun. Some people enjoy gambling at casinos. Others like to trade stocks on a whim.
For entertainment, that’s fine. But none of these activities is going to deliver expected results or be effective.
Only a systematic approach like ours can do that. As a veteran of the capital markets, I can guarantee that practically every trader has pulled off that one blockbuster trade… and has been immediately seized with the thought: “How can I be certain of ever doing that again?”
The answer is our trading system – it gives us “repeatable results” – the framework to have those successes over and over again, regardless of whether the market is having a crazy summer, or a lazy one.
Our system lets you know what to expect. You know that you have a higher probability of winning trades, and a lower-probability of losers. You’re able to max out your winners and cut short your losers. And you know what outcomes expect – and what to do about them.
Including how to reduce risk as much as possible – which is especially important in markets like this one…
Most Importantly, Make Trading Easier for Yourself
With the markets swinging wildly this way and that on news from D.C. and around the world, trading is as stressful as it’s ever been. And as risky. And as likely to ignite emotions.
The answer is a trading system that, while mitigating those risks, lets you know exactly what to do, when to do it, and in a way that’s simple and easy to understand. The 10-Minute Millionaire system makes it easy to screen for stocks that meet our requirements, makes it easy to establish parameters that put probability in our favor, and makes it easy to manage risk. And once it’s up and running, it’s also easy to maintain – in very small increments of time.
Let me share with you something that hundreds of my coaching students have told me helped their trading results – and stress levels immensely.
Picture our trading system as a kind of “trusted employee.”
It provides many of the same benefits as a trusted associate, a person you can delegate work to… with confidence.
This ability to delegate – to “offload” responsibilities and worries without fear – will bring you many personal benefits:
- You’ll be (as much as possible) a stress-free trader. You’ll discover you aren’t obsessing about individual trades (wins or losses) or on what the market is doing day-to-day, since you’ve delegated that responsibility. That allows you to focus on the bigger picture – your larger financial goals.
- You’ll be free to actually enjoy your wins. When you have a system that you have confidence in – and as you watch your winnings (earnings) mount, you’ll find that you have “processing power” available for some of the other challenges or joys that await you, such as your job, your family, your friends. But now these “challenges” are invigorating, even scintillating – and aren’t daunting or odious. As your trading successes mount, so will the successes in other parts of your life.
- You’ll be more “emotionally centered” in your life. I’m a true believer in the axiom “money can’t buy you happiness.” However, not having to worry about money – thanks to our trusted trading system that’s multiplying your assets – is calming, even soothing. You’ll be heartened to discover that other parts of your life will become more enjoyable.
Now, this is all a journey, of course. So I’ll be back in a few days with some news about a new way I’m applying our tried and true systematic approach to the markets. It’s a way to identify extreme moves that are going to keep moving thanks to massive amounts of money flowing into a stock. I’m excited about the results so far, and can’t wait to share them with you.
Great trading and God bless you,
D.R. Barton, Jr.