When Daymond John invests in businesses on Shark Tank, he knows that not all of them will go on to become winners. When just 4 of every 10 of them become successful (40%), he stays highly profitable.
If you want to make 6-figures or more in the stock market, you have to learn how to tolerate painful losses.
Trading losses are just something every trader must embrace as part of the process.
In this issue of All-Access, you will learn how to change your mindset about painful trading losses and use them as a source of motivation.
You will also gain the following insights from our expert traders:
Nathan Bear reveals why adhering to a 5% rule will allow you to properly manage risk so you don't lose all your money trading.
Jeff Bishop leaks a potential breakout trade that he usually reserves only for his paid subscribers.
Jeff Williams explains why you should set a profit target and actually stick to it.
Dave Lukas shares 3 trading tips that he acquired from his experience in real estate.
Today's Trading Insight
Many of the most experienced traders here at Raging Bull cite the pain of losing as an essential prerequisite to their success.
Nathan Bear went LIVE in his recent webinar to reveal his tale of woe — how he lost $40,243.50 trading stocks, only to trade his way back to even and then make several million.
Nathan's story proves that we should not look at painful losses as a problem — but instead a right of passage, something that we must go through in order to reach our goals.
For Nathan, the pain created the prize. Only once he was battle-hardened enough from his losses was he able to not only win it back, but make much more.
THE MOST LUCRATIVE THREE STEP TRADING STRATEGY WALL STREET HAS EVER SEEN
From down $40,000 to over $2 million in trading profits, Nathan Bear pulls back the curtains on the ONE strategy that has made it all possible.
So here's something that you can do if you are conditioned to see the pain of losing as something negative, something that you must avoid:
Allow yourself to lose some trades.
Keep in mind that even a winning strategy can tolerate a certain number of losses, sometimes far more than you would think.
A win rate of 75%, where three of every four trades you make are profitable, may seem like an ideal ratio to the average trader.
However, elite traders know that winning most of the time doesn't necessarily mean that you will be a successful trader. They understand that you also have to evaluate the quality of your wins and losses.
So if you really want to rock the trading arena, you need a quality of fearlessness — not blatant disregard, but an ability to stomach a certain number of modest losses (using appropriate stops)… all in favor of big wins.
For example, you could allow yourself to lose over 50% of the time and still maintain a profitable strategy, so long as your winners are much larger than your losers.
The probability that we could lose a substantial portion of our account on one or two trades is called the "risk of ruin." The idea is especially common in gambling.
While we should embrace losses as part of the trading process, we should still avoid putting all of our eggs in one basket. If you put 100% of your account into a single trade, you're putting yourself at a high risk of losing everything very quickly.
In this post, Nathan Bear talks about how he learned how to protect against excessive losses the hard way.
He explains how the 5% rule, where you only risk that amount of your portfolio on a single trade, can help you sustain your trading activities.
Daymond John and Jason Bond just launched a BRAND NEW mentor service — Profit Tank.
Daymond John is no stranger to challenges in life. He grew up without money and had far fewer resources at his disposal than most Americans.
In his book, The Power of Broke, he wrote about how empty pockets, a tight budget, and a hunger for success can actually be your greatest competitive advantage.
This past Tuesday, he teamed up with Jason Bond to reveal how everyday people can use one overlooked options strategy to lock in incredible returns.
Deciding when to take profits tends to be one of the most difficult decisions for traders. But guess what — it doesn't have to be.
Sometimes the stock that we expected to take profits on in two weeks ends up hitting our profit target in just five minutes. While it may be tempting to let the stock run a little a bit longer, we should always take the profits that we planned on taking.
In this post, Jeff Williams reveals how to set a profit target and stick to it, no matter how tempting it may be to adjust it during the trade.
If you want to kick butt in these markets, don't limit your financial education to the stock market.
Instead, draw insights from other fields and see how that may help you make more money as a trader. You may find that even your own education or career — although seemingly unrelated — can help you make money.
Kyle Dennis, for example, channeled his background in science into a 7-figure trading portfolio and track record of countless successful biotech breakout trades. Jason Bond and Jeff Williams were both elementary school teachers who used their understanding of education to quickly develop their trading skills.
In this post, Davis Lukas shares 3 wealth creation rules that he acquired — not through stocks, but through real estate. Now he's applying them to stocks to make even more money.
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