The “Weekly Market Outlook” is a 10-15 minute video covering all the major markets, and highlighting the best trade opportunities for the week ahead.
This is provided to all subscribers of the “Daily Trading Signals” to let them know what kind of signals we will be expecting throughout the week.
Here are 3 samples taken from our video archives:
Jesse Livermore is known to be the most prolific stock trader. Several books have been written about him and his trading track record is legendary. His profits were so great that he was reported to have owned mansions in various places around the world, each fully staffed, complete with limousines and steel-hulled yacht for his holidays.
Some of you might have read that Livermore was worth $100 million after shorting the 1929 great market crash.
Above: Some of the books about Jesse Livermore, available in major bookstores.
Among the many quips he had about trading and investing, I’ve picked out some of the key ones that could make or break your trading account.
While many complain about the difficulties in trading forex, stocks, or commodities, there is a good minority that makes consistent profits in the markets.
What sets Jesse Livermore apart from his peers?
- Buy rising stocks and sell falling stocks.
The above seems obvious, but many people fail to adhere to this rule. Many people like to ‘pick tops’ and ‘pick bottoms’. Now, professional traders do occasionally try to pick tops and bottoms, but they do so with very strict risk management, and always have a contingency plan for when the trade doesn’t work out.
Beginners often makes the mistake of trying to trade against the trend. While this can be profitable for some, talk to anyone in the trading industry and they will tell you that trend-following is the major money-making strategy that every trader uses. It’s simple, easy to add positions on, and it’s stress free. The problems come when beginners make a buck from trading with the trend, and start to explore ‘new ways’ to trade and invest.
2. Keep trades that show a profit, end trades that show a loss.
Jesse Livermore is famous for his humongous profits, but behind every profitable trader is the admirable ability to deal with a string of losses. It’s one thing to know that you need to cut losses, but it’s another to actually cut your losses when you are wrong. George Soros famously quips that it is not how many times you win or lose, it’s how much you make when you win, and how much you lose when you are wrong.
Cutting losses is a psychologically hard thing to do in modern society. We’re ingrained to be always correct, and never admit that you messed up, because it reflects badly on you as a person. However, with investing, no one is marking you for the number of losses; the profit that you make is the final report card that matters, and that’s where we want to be focusing on.
3. Never average losses by buying more when your stock has fallen.
Too many people refuse to be wrong on their investments or trades.
I have heard of people say this statement: “Even if the stock drops a lot, I’ll just keep it because I’m buying for ownership and dividend cashflow, not just for capital gains.” Sure, but what happens if the stock you hold drops by 70%? 80%? You’ll buy more?
Buying more when the stock has fallen is a sure-way to get your trading account to zero. It’s taking more risk when the odds are against you.
Many traders soon realize early in their career, that their trading accounts could have been profitable if not for silly mistakes. Avoiding these silly mistakes requires experience, maturity, the correct knowledge, and of course, proper mentoring.
I was lucky to be mentored by veteran traders early on in my trading career. Their advice, based upon thousands of hours of market experience, contributed greatly to who I am today, and I never fail to mention, during trading seminars or public events, that by tapping on their experience, I was able to quickly attain a level of success that kept me profitable.
If you’re currently struggling as a trader, ask yourself this question: “Which mistakes have I been making?”
Acknowledging trading mistakes is a continuous process of learning and growing.
Every person has regrets, and as one gets older, it is inevitable that one would start regretting certain things. And when it comes to finances, what exactly do our seniors quip about? What decisions did they make that they regret the most? And most importantly, what crucial advice would they give to those looking to retire comfortably in the future?
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This is one of the most common regrets that is universal to all seniors across the world, with older folk lamenting that they should have saved when they were younger. In fact, saving $10,000 in your twenties adds up a lot more than saving in your 40’s or 50’s. Compounding works to your favour the earlier you start. Expenses also start to rack up as you age, therefore it is much harder to save when you are older.
Property, health spending, and raising a family take up most of your money, and saving money gets a lot harder when the children are begging for you to get the latest mobile device for their birthdays.
Gambling and entertainment eats away at your nest egg, so stay clear of them! It’s never too late to start getting your money habits sorted out.
Back in the 1980’s, investing was a lot harder to learn without the internet. Now, it is an excuse to say that it is difficult to be financially educated. With kids these days being able to build a website from scratch (without supervision), I’m sure you will be able to find something to do that will bring you dividends in the long-run.
Most people complain about not knowing what to invest in. That is a reasonable complaint, but…
The reason why most people can’t invest money, is that they don’t even invest time to learn how to invest.
Time is sacred; use it wisely, and use it on what matters.
If your financial vocabulary includes any of the following:
…you are missing out on a large chunk of the pie. A good diversified portfolio includes much more than just stocks. In fact, holding just stocks can be very risky, as seen during the 2008 financial crisis where most blue-chip stocks plunged by 60-80%.
Multi-asset class, multi-instrument investing is the norm now. If you’re not involved, it’s time to get started.
Another common misconception is that learning how to trade or invest is very time-consuming, but that is actually not true. Like any skill, it might take a while to learn it at first, but after a few weeks, you will soon get the hang of it and it will only require a few minutes a day to manage your finances and investments.
Many parents will look back on their days as young parents and quip that they should have spent less. Some of the bad outcomes include spoilt children, children who expect a lot but don’t contribute, and many more.
Among the many unnecessary expenses, parents could do well to reduce spending in any of these areas:
We sometimes put too much of a premium on university education. Pay what is fair and reasonable; don’t go about spending half a million on a university degree.
Many parents have money but very little time for the children. Ask any child and you would know that he/she would much prefer spending time with their parents than having expensive holidays in Paris, Dubai, or Tokyo.
On hindsight, you would always know better. But hey, take the advice of our seniors, and spend what really matters; our time.
For what use is all these cool stuff, cool experiences, premium lessons and holidays, if we don’t get what truly matters?
Last month, we concluded another exciting run of our “Trading Mastery Program”, where we imparted our powerful “insider” fund trading strategies to empower another batch of traders to gain an unfair advantage in the market.
Reservations for our next intake are open, and you can start reserving your seats before they run out!
Find out more: http://wp.me/P1riws-31L
“This course helped me identify weakness of my trading strategy and being able to time it to make it much better.” – Dominic
“If you are looking to gain strong fundamentals in technical and price action, attend this course! Spencer’s methods are well-calculated and systematic. Comprehensive course material and really liked live Q&A on google sheets. Food was great too!” – Ian
“The course started slow and went into climactic with all the swing, turn, break, & bounce. While overwhelmed with the new information, I believe there will always be support from this team!” – Tan Wei Peng
“The course note is very organized. The post-program schedule is useful. Spencer is able to clearly explain the fundamentals and setups well. Making the course easy to comprehend and execute.” – Tan Jiansen
“The training was comprehensive in covering the setups.” – Quek Boon Kiat
“The course provided very good foundation on price action trading strategy and Spencer displayed professionalism and knowledge in conducting the course. The emphasis on the right psychology and trading plan was very useful.” – Tong Kai Meng
“A very informative workshop for beginners. Chart reading is simplified, so are the steps for trading. It gives people realistic expectations of trading and also confidence to enter trading.”
“The course is structured and easy to understand. Gives me the knowledge necessary to do trading with increased confidence.” – Alan
“This is a great course for beginner or experienced traders. Is clear, simple and easy to understand.” – Francis
“Fantastic program, simply the best. Professional. The quiz is superb!” – Syed, Rolls-Royce
“It breaks things down & simplifies information for you to use.” – John Goh
“This mastery program definitely enhanced my knowledge on forex.” – Terrance Tan
“An excellent course for beginner and advance traders. It brings you back to the fundamentals of a good trader and at the same time provide insights for advanced traders.”
“Appreciate that the materials are concise, simple to understand, and actionable. The resources are also made available to us after for reference. More importantly, there is a community to reach out to.” – Li Seng
“Overall, very structured. This course filtered out all the noise regarding trading and made taking the first step much easier! Structured and with actionable follow-up plan, this course is highly recommended!” – Twain, Ferocity
Reservations for our next intake are open, and you can start reserving your seats before they run out! Find out more: http://wp.me/P1riws-31L
Good luck to all the new “future millionaires”, and see you all at the top! 😀
Have you ever wondered, what are some of the most epic forex trades that went down in history? And more importantly, what crucial insights and lessons can we learn from these legendary traders?
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Andy shorted so much currency that there was not enough currency in circulation to support the short.
The kiwi fell tremendously while he was shorting it and made $300 million for Bankers Trust. Legend has it that a worried New Zealand government official called up Krieger’s bosses and made threats to him. Krieger later left the firm to work for George Soros in his quantum fund.
Stanley Druckenmiller made this historic trade as a trader working for George Soros’ Quantum Fund. He went long on the German mark because of the fall of the Berlin Wall, and the undervaluation that was going on during the reunification between East and West Germany. Legend has it that Stanley initially bet a few hundred million dollars, until Soros told him to raise the bet to $2 billion. That year, the Quantum fund brought in 60% returns.
Stanley is a rather unknown person, but the fact that George Soros hired him is worth noting.
Another trade that Stanley made was in the 1990s. He was buying German bonds, because he expected investors to move from British bonds to German bonds. It was also during the period where Soros broke the Bank of England.
George Soros became famous because he shorted the pound aggressively, in fact, so aggressively that he borrowed heavily and make $1 billion in the process.
At that time, Britain wanted to keep the value of the pound above 2.7 German marks, a key feature of the fixed exchange rate mechanism. Many speculators began to take up short positions in the expectation that this fixed exchange rate would not hold.
This was the famous ‘broke the British bank’ trade that shot George Soros to stardom.
Britain even raised its interest rates to double digits to try to attract investors and prop up the buying in its currency, however, the British government soon realized that it would lose lots and lots of money trying to keep the value of the pound. Soros made $1 billion for his fund on this trade.
The U.S stock market experienced its largest 1-day percentage decline ever on Black Monday of 1987. This was the most shocking fall the world had seen at that point, and even up to today, no 1-day decline has ever matched Black Monday.
Betting on a black swan event netted Paul Tudor Jones $100 million in profits.
The 22.6% drop in the Dow in 1987 has not been rivaled even up to 2017.
Source: stock-market-crash.net
Paul Tudor Jones shorted the stock market, tripling his money, and making US$100 million on that trade while the Dow Jones plummeted 22%.
While working for Citigroup, Andrew Hall predicted a 5-year bull-run in oil from 2003-2008, and made the appropriate trades. Oil went from $30 to $100, and Hall brought with him $100 million as part of his compensation plan.
Andrew Hall made it big on oil in his career at Citigroup.
Aside from this brilliance, he reportedly bought 1 million barrels of physical oil in 2009, and stored it, hoping that oil would rise greatly. It did, and from 2009-2011, oil went from $50 to $100. However, his oil fund hasn’t been doing well in the past 5-6 years, and he has had to repeatedly explain the lack of profits to investors.
David Tepper’s strategy was simple; buy low, sell high. In early 2009, he scooped up big banks like Citigroup and Bank of America, and saw them quadruple and triple in value from their bottoms in 2009.
Nothing spectacular; buy low, sell high.
These trades earned $7 billion for Tepper’s hedge fund. His personal compensation was $4 billion.
Louis Bacon went long on oil, short on stocks in the 1990s because of this geopolitical situation. Later, he also correctly bet that the U.S. would quickly defeat Iraq and the oil market would recover.
Bacon’s event-based bets rewarded him handsomely.
Louis Bacon explaining what he knows best; geopolitical event trading.
Source: Quotesgram
His hedge fund returned 86% that year because of these trades. Although his strategy is somewhat unconventional, he has excelled in it and carved a niche for himself.
Many of these traders had decades of trading experience under their belts. Although they all seem like they had a great stroke of luck or a brief moment of brilliance, the preparation and practice that they went through was thorough and gruelling.
I hope that these stories of real traders would motivate you to continue at your game, brush up your skills, engage the financial markets, and stay up-to-date with what’s going on.
