The key to successful trading and investing is not stock picking.
The key is maximizing the best hands through adaptive money management.
“The most significant is that it’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.”
- Druckenmiller
“When you have tremendous conviction on a trade, you have to go for the jugular”
- Soros
This management feature is not talked about much. In the cases when it is discussed, the importance of this feature is mostly missed.
The most successful investors of our time have about a 50% win rate. Logically the rest of the equation becomes a matter of risk to reward.
The stage is set by the combination of risk to reward as well as win rate.
BUT! This is not all.
A secondary level enters the equation.
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Dynamic maximizing within an existing position. The best traders add to their winners.
4 scenarios become the norm:
1. Enter and get stopped out
2. Enter and take the profit
3. Enter, pyramid(add), stop out (breakeven or in the money)
4. Enter, pyramid, take a massive win
This 3. And 4. points are the core of almost all 9 and 10fig traders and investors.
This is where that seemingly impossible outperformance comes from.
This is something I saw through studying the best and a technique I implemented in my own trading for my 2020 year.
It is only when you have profits and a cushion that outperformance starts, the rest of the time, the performance trails the average performance of funds, traders and investors.
“The way to build long-term returns is through preservation of capital and home runs. You can be far more aggressive when you’re making good profits."
-Druckenmiller
I will follow up with up with more details about how to put yourself in these situations.
In the meantime, try and figure out how you can safely and/or through a data proven edge put yourself in such asymmetric situations to take advantage of the skew.
Let me and the community know your thoughts below 👇🏼
With this article, I aim at revealing five (but you can derive from these ideas more) strategies to follow when trend trading. The ideas behind are sublime and simple, just like trading is supposed to be for the traders looking for those approaches.
https://t.co/j5pB5DxW46
Kesimpulan:
Nak iv, cari bau lavendar.
Aku rekemen ambil Kahf Forest dan Oud.
Pastikan ia sesuai dengan anda, memang kena test.
Moga bermanfaat untuk lelaki sekalian.
If you are serious about learning
Start reading 100 Mental Models.
People like Elon Musk, Naval Ravikant & Warren Buffet extensively use them to think rationally and make better decisions.
Get started now and get the top 50 books of all time for FREE:
https://t.co/yo5RLRiO5h
With many stocks running up 5+ weeks in a row, now is a good time to rewatch the clip below by O'Neil and refresh your mind as to why that's important to pay attention to.
👇🏽👇🏽
Alexander Elder's 2% and 6% Rules
Beginners who count profits put their cart before the horse. Reverse that approach and begin by counting risks. Ask yourself what your maximum permitted risk is if you follow the 2% and 6% Rules.
These are the steps of proper money management:
The most sought-after exec coach in Silicon Valley coached @naval.
Then went on to coach the CEOs of Reddit, OpenAI, Coinbase....even Sequoia Capital.
Here are 5 “MAGIC” questions he has all his leaders ask their teams:
Alright guys. I've plotted the setups & entries of the 5 charts that @vivbajaj discussed with @markminervini during their Face2Face interview.
10 PDF pages w/ charts while the setup was unfolding & few months post the breakout.
https://t.co/8tK1laITUd
https://t.co/rjYjdlLZEC
8 Alternatives To Holding Cash
1. High yield savings account, up to 4.88%
2. Fixed deposits, up to 4.05%
3. Money market funds, up to 2.9%
4. Bond/sukuk funds, up to 5% or higher
5. ASB & ASB2
6. Tabung Haji
7. SSPN
8. Flexi home loans
Tiada buku self-help yang akan membantu kita jika ia tidak disusuli dengan tindakan.
Baca 1 buku dan praktikkan terus.
Membaca satu demi satu buku self-help memberikan ilusi kita bergerak ke arah makin baik.
Baca dan bertindak.
The best traders in the world have made millions from one setup.
The setup? A breakout from a base.
But what do these bases have in common & what should you be looking for?
Here are the most important characteristics of a proper base, broken down one by one 🧵👇
Minervini explain pullback buy in the below clip better that I would ever manage to.
7 minutes of pure gold education. Go nuts!
https://t.co/j66o3fUSh3
Nak belajar perkara baru?
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Kedua, pilih 3-10 buku berkaitan topik tersebut.
Ketiga, buat nota ringkas.
Keempat, aplikasikan dalam hidup.