In this episode of How to Trade It, I share my journey to becoming a trader—which includes my inherent love for risk. I also talk about the WORST thing that’s ever happened to me as a trader. I share the GREAT thing about reversals and my 3 points to successful trading. I also talk about the importance of measurement statistics and tracking your wins/losses. Lastly, I share the setup I’ve been looking at—USD/JPY.Listen to this episode of How To Trade It—I share my journey of becoming a trader. Check it out! #stocks #trading #StockMarket #Investing #DayTrading #StockPicks Click To Tweet
You’ll want to hear this episode if you are interested in...
- [2:04] The official results of the 20-Trade Challenge!
- [8:48] How I became a trader (thanks to my Dad)
- [11:36] How my LOVE for risk has been beneficial
- [16:14] How one bad trade impacted me
- [20:41] The GREAT thing about reversals
- [23:43] Mindset, strategy, and money-management
- [26:46] Measure and analyze your statistics
- [28:46] Take ownership of your decisions
- [33:00] The set-up I’m tracking: USD/YEN
The results of the 20-day challenge
Before I entered my final trade into my stat sheet, my average loss was $905 and my average win was $4,000. My risk/reward ratio is 4.45, which is pretty good. This puts me at a win percentage of 35%. This might not seem high in the short-term, but a lifetime win percentage of 35%—I’m still making money. Over the course of 20 trades—completed LIVE—I’m up $18,567.81. My win percentage was 38%. 18.5 trades in a row would put me at breakeven.
If you look over the 20 days, I had some losses. There are gonna be drawdowns, and sometimes they can happen for a long time. But when you hit a good winning streak you get right back on track. I had a trade that was $6,000 and another that hit $7,000. Large wins like that (closer to 10 to 1) are harder to get, but when they do come they bring you back up.
My journey to becoming a trader
I was a computer nerd in high-school. My aunt worked for Intel (circa 1993) and taught me everything I needed to know about computers. My Dad—who worked as a diesel mechanic for a goldmine most of his career—sold his house and started trading. At the age of 16, I taught him how to use a computer and he taught me about the stock market.
I had an interest to pursue. So in 1996, I joined the military and I started trading. Any income that came in I threw into my E*Trade account and I was doing really well with tech stock. I was getting out of the military right around the dot-com bust. Luckily, before it happened, I had liquidated my accounts for money to live off of during the transition. It’s not something I would recommend doing now, but it worked out at the time.
Becoming a trader was a way for me to incorporate risk into my life. Unlike many people, I have a HIGH risk-tolerance which has helped me out in life. It’s caused me to take action and persevere when others would quit. Keep listening to hear about the worst trade that’s ever happened to me and how I chose to persevere through it.My journey to becoming a trader started young Check out this episode of How To Trade It for the full story! #stocks #trading #StockMarket #Investing #DayTrading #StockPicks Click To Tweet
The importance of trading strategy & measurement statistics
There are three points to consider to be successful as a trader: mindset, strategy, and money-management.
- Mindset: realize that you can’t control the market—but you CAN control your actions
- Strategy: follow a chosen strategy and measure your results.
- Money-management: I like to go for big-winners: 3 to 1, 5 to 1, and 10 to 1 when possible.
It’s also vitally important to track the statistics of your trade. Why? If you’re not analyzing your statistics, you’re never going to grow. Never. I look at my win percentage, what I’m expecting to make each trade, my risk versus reward ratio, etc. I analyze my trades, enter them into a spreadsheet, and measure how I’m doing. With every trade I ask myself, what can I do better than last time?
The dollars in your account represent you as a trader—but internal mechanisms are important, too. Keep listening for my discussion on taking personal ownership of your decisions.
My current setup: USD/JPY reversal
Finding a reversal is the greatest possible scenario. A tight stop-loss can get you a big win. The great thing about reversals is that you’ll see little hints or clues beforehand. People often refer to a reversal as “trying to catch a falling knife”. Everyone tries to figure out where the bottom is—but I don’t. Instead, I focus on the clues that the reversal is starting to happen.
A reversal that I’m looking at right now is that USD/JPY. It is being overbought and oversold right now. It’s gone up 1,000 points over two weeks, so I’m waiting and watching for reversal signals. If I go down another 60 points and we get a nice solid burst of momentum—I'm going to take that trade. I'll short the USD/JPY and try to put a drop into a lower time frame.
Listen to the whole episode for details on my strategy and why I think this could be a win.I’m looking at a USD/JPY reversal—listen to this episode of How To Trade It to hear the details! #stocks #trading #StockMarket #Investing #DayTrading #StockPicks Click To Tweet
Resources & People Mentioned
Connect With Casey Stubbs
- Website: https://caseystubbs.com
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