Sunday, July 31st, 2016

How NOT to GAMBLE and get killed

Often times Market is too lucrative to give up and the tendency is to shoot for the BIG GAME and make a million bucks and retire, or something thing. I have seen it done it and lost it. Its one sure fire way of creaming your trading account in one swipe. Margin calls follow, and accounts get flagged and closed. This is true for a day trader  who is trying to scalp  pennies and once in a while he bets  the farm, and often to the wrong side of the market.

Trading is NOT GAMBLING. If you are a gambler its much better to take a Greyhound Bus to Las Vegas ( save your gambling stash) and open it  to bar drinks, poker, blackjack and many other ill fated games and get taken in by the Corporate Casinos. You may end up hitch hiking back home, in the cabin of some smelly truck driver from Russia.

When people mention Stock Market in the same vein as Gambling, I almost cringe and sometimes puke at the concept. Well, that’s because that is a wrong mind set applied to making money. I take the Stock Market as my profession, a craft and a way to pay mortgage, and put milk and coffee on the table. Its not some gambling den that you come to and get busted and go out in glory. Heavens No. I have seen so many people come and go and blow off all those $2000 to $10,000 accounts in  few weeks and that is pathetic. Thank God SEC has placed a  limit of $25,000  on pattern Daytraders, otherwise there would have been so much more heartache.


This is where it gets personal. Each of us have certain circumstances and cash flow needs and if we take those limited funds and try to make some kind of cash flow out of it, we may just hang ourselves, because that kind of pressure to make money, is never the right frame of mind. Its a mind driven from need, a need to survive, and survival in the Stock Market is downright Brutal. Trading is not a soft game, it can be  honestly very Brutal and punishing on the Ego. So if you are gambling your last stake, just stop there. I know I did it with Seminar hype Guru WADE COOK back in 1996-1997 and he was not ashamed in asking me to sign up and hustle my last dollar.  However, I survived, and lived to tell this story another  day. That lesson still holds true to this day in 2009…

This is a Bull market in 2009. Big money is made in the first 1 or 2 years of a new Bull Market according to Investors Business Daily William O Neil in his book ” How to make money in Stocks” . This can be very enticing and is filled with opportunities for those who have enough capital to trade and survive.  Big money is always made on the long side , contrary to what the bears may argue, because  stocks have a natural tendency to go up in the long run. Derivative traders or option traders like me also make lots of money because of the leverage involved, but with sound risk management. There is a saying on Wall Street, if you take care of your losses, profits will take care of you.

So come and take care, and take full advantage of this Stock Market in 2009. Don’t fret and waste your time sitting on lines and hoping the gravy train will hit you in the face, it never will. See my post , this is not 2008. It speaks the truth. I am trading and making money, and with prudent investing and risk management it should be a nice ride up this year.


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