I was once a gambler, but now a trader.
I once blew up a 200k account within a matter of weeks. Up until that point, I thought I was a trader. I opened up a trading account during the last stages of the roaring 90s internet boom. For a while things were great. So great that I almost left graduate school at 23 and did move into a high rise penthouse apartment foolishly thinking that after a few months I had made it as a trader.
Morning rituals are said to lead to success. Here was mine:
I'd get up 10 minutes before the market open. Maybe brush my teeth but definitely turn on CNBC. Grab a napkin or whatever else there was to write on and jot down whatever stocks they were talking about. That was the day's trading list and I'd jump in and out of stocks from these "well researched" lists. Depending on my gut feel, sometimes I'd be out in a few minutes, sometimes a few weeks.
Rule number one in my foolproof plan was to always hold when a stock tanked, because stocks always bounce back quickly no matter what! It wasn't until a little bit later that I'd find out this rule only applied in the wacky internet boom.
Some days I'd lose a little, some days a lot. Other days I would make insane percentage gains. At the time I didn't realize doubling up the trading stack in one week was not normal. In just a few months the minuscule 5K stake had turned to $200,000 and I was living large.
Until I wasn't.
In a few weeks it was all gone, along with my dreams. My dad, who has taught me more life lessons that I can count (like when he hit the 9 year old me with a baseball), told me something I'll never forget.
Go to a casino son because you are not investing, you are gambling.
There is a fine line between investing, trading and gambling. Investors search for value. Traders search for momentum. Gamblers hope to get lucky and search for the next fix.
I was once a gambler.
Over fifteen years later, my morning ritual has changed. I now get up at 4:30 am sharp. I meditate, exercise, read and listen to a little sports talk radio before I get my work day started. Once I am ready to start my research before the trading day begins, I say the following 7 words:
Trading without a strategic edge is gambling.
This sentence has become part of my morning ritual. A habit. It has kept me from making god knows how many bad trades.
Now the fix is not the trade, but the search for the edge before the trade. I no longer allow the emotions of a degenerate, namely fear and greed, to guide me. No more micro-managing and fear-of-missing-out. All because of 7 simple words.
If you are trading without an edge, let me know how I can help you. We'll talk about the BOW Swing Service (up 30%+ in a tough 2016 market) and free educational posts and videos, personal one-on-one mentoring or just shoot the breeze and get you pointed in the right direction.
Subscribe to The Market Speculator by Email and never miss a post!
If you would like to learn more about how I trade, receive my nightly focus list with market analysis, setups and trade alerts, sign up at BullsonWallStreet.com