B The Trader - Personal Trainer Made $2.2 Million Scalping!
The trader began his journey in 2020 after losing his personal training business due to the pandemic. Initially, he lost money every month but decided to go full-time in trading by January 2021. He set strict rules for himself, such as wiring out profits daily and maintaining a minimum account balance to avoid falling below the PDT rule. He focused on long-biased trading during market hours, avoiding pre-market and after-hours trading. His strategy involved trading small to mid-cap stocks, focusing on hot sectors and themes, and learning from influential traders. Over time, he developed a disciplined approach, drawing from his background in personal training, which helped him stick to his rules and achieve consistent profitability. Despite challenges, including significant drawdowns, he used past experiences to recover and improve his trading performance.
Key Points:
- Set strict rules: Wire out profits daily and maintain a minimum account balance to avoid PDT issues.
- Focus on long-biased trading: Trade during market hours only, avoid pre-market and after-hours trading.
- Learn from past mistakes: Develop rules based on previous losses and focus on strengths.
- Discipline is key: Draw from past experiences to maintain discipline and stick to trading rules.
- Adapt and learn: Use experiences from drawdowns to improve and recover quickly.
Details:
1. 💡 Overcoming a Year of Trading Losses
- In 2020, the trader experienced losses every month without a single profitable month.
- To combat this, they implemented a strategy of wiring out any earnings made during the day, whether it was $50, $200, or $300, starting each day with a fresh account balance.
- They set a strict daily loss limit, not allowing themselves to lose more than $100 per day, which helped in managing risk and preserving capital.
- The primary goal was to consistently demonstrate the ability to succeed in trading, focusing on discipline and risk management.
- This approach required daily discipline and a commitment to starting each day anew, which helped change the trajectory of their trading performance.
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3. 👥 Meet Ben: Long-Biased Trading Expert
- Ben is a long-biased Trader specializing in small to midcap stocks, leveraging this approach to capitalize on growth opportunities in these markets.
- With over four years of trading experience, Ben has honed his skills in identifying and investing in promising stocks, focusing on long-term growth rather than short-term fluctuations.
- In contrast to the prevalent short-selling strategies common in the small cap sector, Ben's long-biased approach focuses on sustained investment and value appreciation.
- His strategy involves thorough research and analysis to uncover undervalued stocks with high growth potential, aiming for significant returns over time.
4. 🏋️♂️ Transition from Personal Trainer to Trader
- The COVID-19 pandemic in 2020 led to a shutdown of personal training services, prompting the speaker to seek new opportunities.
- The speaker had been a personal trainer for seven to eight years before transitioning to trading.
- The transition was self-initiated, starting with exposure to trading through online advertisements and resources like books.
- The speaker engaged in self-directed learning to understand trading, using various online resources and literature.
- Challenges included adapting to a new industry and acquiring the necessary skills and knowledge for trading.
- The speaker overcame these challenges by dedicating time to learning and leveraging online platforms and communities.
5. 💪 All-or-Nothing Decision to Trade Full-Time
- COVID-19 restrictions drastically reduced the speaker's personal training business to 5-10% of its previous capacity, prompting a career change.
- The speaker's decision to transition to full-time trading was motivated by a passion for numbers, money, patterns, and trends, along with strong analytical skills.
- This career shift was an all-or-nothing decision, with the speaker fully quitting personal training to focus on trading.
- Initially, the speaker faced challenges in understanding market dynamics and developing a consistent trading strategy, which required intensive study and adaptation.
- The speaker leveraged existing analytical skills and a passion for market trends to overcome early trading challenges.
- Prior preparation included studying market patterns and trends, which facilitated a smoother transition into full-time trading.
6. 📈 Setting Goals and Learning from Losses
- Started trading full-time in January 2021 with minimal prior experience, having only begun exploring trading in June 2020.
- Initially traded using a paper account for a couple of weeks before transitioning to real money with a small account of around $5,000.
- Despite starting with real money, experienced consistent monthly losses throughout 2020, with no profitable months before committing to full-time trading.
- Supported financial needs with minor income from personal training while focusing on developing trading skills.
- Set specific goals to improve trading strategies and risk management, focusing on learning from each loss to adapt and refine approaches.
- Utilized losses as learning opportunities, identifying patterns and mistakes that informed future trading decisions.
7. 📊 Crafting a Successful Trading Strategy
- New traders often face larger losses than gains, making it essential to focus on risk management and adjust dollar amounts in trading accordingly.
- In the first six to seven months, it is crucial to analyze reasons for losses to refine trading strategies effectively.
- Understanding the common pattern of winning less than losing in terms of dollar amounts can guide new traders to develop more balanced approaches.
- Successful traders emphasize the importance of learning from early losses and continuously adapting strategies to mitigate risks.
8. 🔍 Finding Simplicity in Trading Rules
8.1. Trading Goals
8.2. Trading Strategy
9. 🔧 Tools and Techniques for Consistent Trading
9.1. Cobra Trading Promotions
9.2. Personal Trading Strategies
10. 💼 Effective Account Management Practices
- Funded account to $25,100 to stay above the Pattern Day Trader (PDT) rule threshold, aiming not to lose more than $100 to prevent falling below this level.
- After a significant loss in 2020, disciplined financial strategies were necessary to manage the remaining $15k in assets.
- Implemented a strategy of wiring out daily profits to start fresh each day, effectively managing risk and maintaining the ability to trade without exceeding the $100 loss limit.
- Maintained an account balance of $26k by October 2021 by withdrawing excess from profitable days, ensuring that losses did not require additional deposits.
- This disciplined approach of daily withdrawals and maintaining a strict loss limit facilitated financial recovery and sustainable growth.
11. 📚 Developing and Committing to Trading Rules
- Developing and committing to specific trading rules can be essential for long-term success, as demonstrated by the need to prove trading capability consistently over time.
- Tracking trades and carefully analyzing performance data led to the creation of specific rules such as avoiding pre-market and after-hours trading, focusing solely on intraday trading during market hours.
- The decision to focus on long bias trading only, rather than trading both sides of the market, was based on a strategic understanding that markets tend to rise over time and that long positions generally offer safer risk tolerance.
- By studying past losses in pre-market and after-hours trading, a clear trading strategy was developed to mitigate risks and increase the probability of success.
- Commitment to the rule of not shorting and maintaining a long bias during market hours was crucial, with the insight that this approach aligns better with market trends and personal risk management preferences.
12. 🔥 Mastering Hot Sectors with Long Bias
- The trading strategy focuses on small caps and midcaps, heavily influenced by Roland and Cody, emphasizing sectors, themes, and sympathy plays for identifying lucrative opportunities.
- Recognizing hot sectors and understanding their causes and movements is integral to the strategy, which requires constant monitoring of market dynamics.
- Daily trading is practiced, but the frequency of viable hot sectors varies, with more momentum and activity noted during 2020-2021, particularly with Bitcoin and NFT stocks.
- Sector movements, such as those in March 2021 with NFT stocks, were pivotal, prompting a sharper focus on sectors and themes to capitalize on market shifts.
- The strategy has evolved to include a broader understanding of trading, utilizing daily charts, breakouts, and catalysts, rather than relying solely on sector-based tactics.
13. 📅 Leveraging Daily Charts for Success
13.1. Introduction to Long Bias Trading
13.2. Importance of Daily Charts
13.3. Recognizing Patterns, Volume, and Breakout Realities
13.4. Learning Key Levels
14. ⏳ Patience and Timing in Trading
- Strong breakouts require time, occurring over days to months, particularly in midcaps or hot sector themes.
- Day traders should maintain flexibility, ready to trade breakouts multiple times within a day if necessary.
- Trade entries should be opportunistic, varying from scalps to full trades, depending on the chart's progression.
- Caution increases as a chart progresses; later trades might be reduced to scalps or simply watching for the right entry.
- Early trading focuses on small scalps, aiming for gains of 10 to 20 cents, with patience increasing over time.
15. 🔄 Achieving Consistent Profitability
- Transitioning from short quick moves to building larger positions is instrumental in achieving bigger moves, thereby increasing profitability.
- Focus on building confidence and experience by sticking to familiar trading strategies that have proven successful.
- Full-time trading profitability was achieved starting January 2021, with a consistent track record maintained since then.
- Reached break-even in March 2021, successfully recovering from the losses incurred in 2020.
- Specific strategies include analyzing market trends to identify larger move opportunities and gradually increasing position sizes to capitalize on these insights.
16. 💡 Insights into Risk Management
16.1. Consistent Profitability and Risk Management
16.2. Risk Management Strategy
16.3. Psychological and Strategic Insights
17. 🏆 Discipline: The Key to Trading Success
- Success in trading is often achieved by those who apply consistent discipline, similar to athletes or individuals in physique competitions.
- The discipline required for trading is akin to the daily commitment seen in sports; top athletes consistently put in the work regardless of circumstances.
- Creating and adhering to personal rules is crucial for successful trading, especially when emotions and real money are involved.
- Many traders know the theoretical rules of trading, but true success comes from the ability to stick to these rules under pressure.
- Personal background in activities requiring discipline, such as training for competitions, can positively impact one's ability to succeed in trading.
18. 🔑 The Importance of Following Your Rules
18.1. Sticking to Your Trading Rules
18.2. Tools and Strategies for Long-Biased Traders
19. 📉 Handling Challenges and Staying Resilient
19.1. Volume and Money Flow Insights
19.2. Recognizing Successful Patterns
19.3. Importance of Discipline
19.4. Facing Challenges Before Success
19.5. Overcoming Self-Doubt
20. 🔄 Bouncing Back from Setbacks
- Reflecting on past experiences helps in overcoming setbacks more effectively.
- In July, faced the biggest drawdown ever, losing almost $30k in a week, but used past experiences to recover.
- After the setback, achieved the best three weeks ever by reflecting and applying previous learnings.
- The journey involves constant mental challenges and self-doubt, regardless of the experience level.
- Consistency and discipline are crucial in navigating through tough periods.
- Drawing lessons from initial struggles enabled quicker recovery from recent challenges.
21. 👋 Conclusion and Connect with Ben
- Ben is open to communication via Twitter and Instagram for those interested in contacting him.
- The host appreciates Ben sharing his story on the show, suggesting it was valuable content.
- Ben expresses gratitude for being on the show, indicating a positive experience.