If you’re in the trading business, you’re already doomed.
And yes, I’m writing this because I WANT to scare you.
During my 10+ year trading career I’ve realized an important truth:
That if I don’t scare traders enough, then they don’t take trading seriously enough.
They’re not cautious enough.
They make stupid and costly mistakes.
And destroy their trading account.
In fact, I even implemented this philosophy of “you are already doomed” in my own hedge fund.
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Before I started the whole hedge fund project, I told everybody in my team:
“Guys, we are going to fail. This business is tough, the odds are against us, and we’re competing with some of the very, very best. So we’re already doomed, and it will be very painful”.
Why such harshness, you might wonder?
Because once a trader gets REALLY scared, a crucial shift of focus can finally happen.
A mental shift from living with your head in the clouds, to building a bullet-proof DEFENCE system!
So, if you want to be a successful long-term trader, start with bullet-proof DEFENCE.
Here are the 3 military defence fronts we’ve implemented in our hedge fund (which you can also do too):
Front #1: Bullet-proof entries
A lot of entries in live trading fail.
Markets are noisier than ever. There are more false signals than ever, so you need to work on your entries more than ever too.
But you need to be VERY careful how you do it…
Most traders do it the wrong way – they try adding a bunch of extra filters which only curve-fits their strategy even more.
What you really need is some fresh thinking. Some out-of-the-box ideas.
Like assigning different risk or position sizes to different entries, based on their probability of win or failure. Or managing your entries with true intelligence, like based on current volatility levels.
You can discover more about how to cut through the market noise at Smashing False Breakouts. That’s one of many things we use in our hedge fund to build our bullet-proof entries.
Front #2: Absolute ability to adapt
Markets are changing all the time and if you can’t adapt, you will get beaten more than often.
That is why regular reoptimization and regular maintenance of your strategies is crucial.
It’s as simple as that.
You need to know exactly WHEN to reoptimize. HOW to reoptimize. What OPTIMIZATION RANGES to use. What optimization STEPS to use. What FITNESS FUNCTION to use. On what HISTORY to base your new optimization set. And what other DETAILS you need to be aware of, before risking your hard earned money.
The devil is in the details.
Of course, in the Breakout Strategies Masterclass, I explain how we do this in our hedge fund. Step by step.
Front #3: Bullet-proof portfolio
One strategy is like a lone soldier on a battlefield.
Whereas a well-constructed portfolio is like a heavily-armored and well-equipped army.
With a good portfolio, you are stronger than ever.
But such a portfolio requires diversification across different markets, timeframes and strategies. With low correlations.
If you can achieve this, then it’s like having an army to defend your money. With tanks, soldiers, missiles, fighter jets, submarines and bulletproof Hummers.
While your enemy only has a few guys with handguns.
There is no defense like a well-crafted portfolio.
Of course, a portfolio requires you to have a lot of trading strategies at your disposal. But that’s not a problem, you can always take the 14-day breakout challenge where you will discover how to build your first breakout strategy (and many more) in just 14 days or less.
So, back to work soldier.
Tomas & Andrew
Stop False Breakouts from Destroying Your Trading Account
✓ How false breakouts are the biggest leak of money for breakout traders, including Futures, Stocks, FX and ETFs
✓ How much money false breakouts could actually be costing you – without you even realizing it
✓ A comprehensive deconstruction of timing – enter breakout trades at the right time and stop costly breakout trading mistakes
✓ 4 proven approaches to slashing false breakouts today – stop them from stealing your money and eating all your profits!