Top 10 Tips to Better Your Trading for 2021
- [Tim] So, I just wanted to go over what I think my top 10 tips are for 2021. Really learn from this bubble market. As I said, the market ebbs and flows 2020, specifically, December 2020. We're just seeing a ton of plays, a ton of euphoria, a ton of speculation.
I don't know how long it lasts. I mean, if you look at the trends where more people are staying home, more people are opening brokerage accounts, we're having stimulus checks being sent out, which many people are depositing into their brokerage accounts. A lot of people are now getting into trading because they realized like the economy is not what it once was, like virtual stuff really matters. Being able to make money from home matters. So, we'll see how long the trend lasts.
And we'll see how long everything continues or doesn't continue. If it stops tomorrow, I'm fine. If it goes on another three months, six months, 12 months, I really just want you to maximize your education. Find which patterns are your favorite and least favorite.
So, if you look at a lot of my top students they're doing well. Huge, like six figures per month, sometimes even six figures per week lately. Those are just a few students. Again, most traders lose, but the key to becoming one of my top students is really finding what works best for you.
And because there are so many stocks in play this gives you the ultimate time to really speed up your learning curve and speed up your education, because you can really test and tinker every day. You have sometimes five or 10 big percent gainers, whether they're dip buys or breakouts, or short-selling first red days, try it all, paper trade, trade small, but just really try to maximize this learning opportunity. There won't always be this number of plays. Rule number one, I mean really cut losses quickly when wrong, but also I really want people to get more conservative especially in the beginning of your trading career. I mentioned that most traders lose. I want you to understand the odds are against you.
I want you to understand the reason why most traders lose, they don't cut losses quickly, they do go for home runs. Sometimes not cutting losses quickly can lead to a profit. Sometimes you will go for a home run and get it. But I don't really teach about strategies that can work sometimes, because if you don't cut losses quickly, I mean it's a very slippery slope. You might let just a small mistake turn into a giant disaster.
And if you do go over home runs, you'll swing and you'll miss most of the time. And I know it's fun to hit a home run. Like that's where the adrenaline is, but for me slow and steady singles, win the game. And in this market sometimes I'm hitting doubles too, but I aim small miss small, and I really think that's good, especially at the start of your trading career.
Feel free to get more aggressive three, five, seven, 10, 20 years in, once you have a lot of experience and ideally a lot of money under your belt, but not in the beginning. Small gains really do add up. And this goes into my next point. Like the most success you'll have is in the long run. You see what like people like Tim Grittani are doing? He's been a student of mine for a decade. You see Mark Crook who watched all of my video lessons three times.
I think he's closing in or maybe even over 3 million, he has to update his profitably. Michael Good, has been studying non-stop for over a decade now. Even newer students like Rolland, he studied 17 hours a day for several years.
Jack, I mean he's year four, but he's has literally no life. And I say that lovingly but he's had no life for basically four years because he became so obsessed with learning. So you choose your dedication level, but I'll tell you, it really starts to click several years in. And again, maybe you can speed up your learning curve in this current market, but have patience because there will be colder markets, there will be in between markets and you just got to learn from each of them. Life is long.
Stock market will be there for the rest of your life. There's a reason why the top traders, the top earners are like in their fifties and sixties and seventies, cause they've seen everything. And then they use that experience to really get an edge and an advantage over others. But also use Stocks and Trade Breaking News.
Really, this has changed my trading, it's changed my education this year. Being able to see the news all in real time, being able to see and learn from what the market is rewarding, learn from what the market ignores. Out of all the tools in your potential arsenal I really would recommend Stocks and Trade Breaking News the most. And you know, yes, I'm part of the team that created stocks to trade, so maybe I'm biased, but at the same time I am also biased because I want the most successful students. I'm trying to teach you and I'm trying to give you tools that I think can speed everything up.
And if you do understand how most traders lose and you understand that this is a battlefield, you need to be armed, you need to be heavily armed on this battlefield. If you don't have level two, if you don't have the proper news, if you don't know what's being said on TV or in chat rooms or going across multiple wires like or rumors, you are at a disadvantage. So I want you to turn any potential disadvantage of being uninformed into a potential advantage of being informed. You choose your dedication level. I have both part-time and full-time trading students. Don't feel scared to need to study 17 hours a day.
Don't feel the need to have no life like many of my top students do. Also understand like as scary as this is as overwhelming this is, it gets easier over time. This is not rocket science. I've taught some very, very uneducated lazy, degenerate students, and I say that lovingly, but realistically too, they've understood the gist in the strategies and they've learned risk management within a few years. But you choose, like try to make the market and training work for you.
This is not one size fits all. You don't feel like anxiety if you miss a trade, don't feel anxiety if like, you're trying to balance your work or your school and your family life or trading, make it work for you. You do not want to become a slave to the market. For me, I teach about the stock market and I want people to get into it to enhance your life not to obliterate your life or decimate your life like many gambling addicts do.
Recognize that this is addictive. Recognize that there's some chemical reactions going on in your brain when you make a profit. And it's like social media, it's like getting a like, it's like a dopamine hit and you have to control that addiction. It's a very slippery slope where you start with just wanting that addiction, you start wanting the money every day, and then you don't even need that much money frankly to live on. I'm proud to donate all my trading profits to charity. I've dissociated myself from that addictive rush of profits because now for me, it's more of an addictive rush when one of my students gets it.
And every new student messages me when they have like that aha moment usually two or three years in. It's also not about how much money you make in the beginning. It's how quickly you refine your process and hone your trading skills in the beginning. There's a lot of people who make a lot of money right away, the wrong way. Like going all in, using leverage, doing risky stuff that will come back to haunt them and really crush them in the long run if they keep doing that.
A lot of crypto people think like they don't need to be conservative. A lot of people who catch a lucky pump or catch a hot trend, or catch a hot stock and they learn the wrong lessons. I compare it to kind of like childhood TV stars or like athletes who get a big signing bonus and they don't know how to manage their money. Even if you made a lot of money really quick you probably will lose it.
You don't know how to handle it. You haven't truly earned it. It's better to really start small to paper trade or not even trade in the beginning.
Brokers don't like me saying this, they just want your commissions. For me, patience is really an amazing thing. Oftentimes the best trade is no trade. So don't feel bad if you have no positions, don't feel bad if you miss a trade. Sometimes part of your education like a checkbox and you have to check off, is see a good trade, not taking a position or maybe not getting executed, then seeing it work out perfectly the next day and you missing out on that, and feeling the frustration.
That's a lesson that you need to learn. It's not a fun lesson. It's not an exciting lesson, but it's a necessary lesson because then next time you'll say, Oh, I remember the last time I saw a set up like this and I missed it, and I felt like crap, and now I don't want to feel like that again. So that miss, that FOMO, fear of missing out, can help you in the long run. Maybe you miss it twice.
Maybe you missed it three times. And on the fourth time you're like there's no way I'm going to miss it, I miss it three times before. And the fourth time or the fifth time you nail it because you remember those previous times when you didn't nail it. And that really creates a little chip on your shoulder that motivates you to take things even more seriously and become more obsessed and meticulous. And that's good.
That's the way that you should have been in the beginning but you didn't know how quick these docs moved and you didn't know how bad it felt to miss those moves. So I know this sounds crazy but a lot of the best lessons are counterintuitive. I can't say this enough, never forget 90% of traders, I'm gonna even change this.
I'm gonna say 90% plus of traders lose. We don't know the exact stats, but we see a lot of academic studies saying 90, 92, 93, I'll say 95, maybe even 99%. Do not do what they do. And the key to that is preparing ahead of time and knowing you're.. Look at this, I have a typo. I'm not even that smart.
I have typos, I proof read this and I still got it wrong. Knowing your market history inside and out. I am a glorified history teacher. You can be wrong on any trade.
I can be wrong in any trade. Never go all in, never use leverage. Always expect the worst out of these companies, but at the same time, know your history. I say I'm a glorified history teacher. If I was an actual history teacher I would say know about the Byzantine empire, know about the Roman empire, know about the Egyptian empire, know about the Mayans.
Know about all these different empires throughout history if I was a historical teacher about empires. Just an example. But for me, I'm a stock market teacher and the best tips that I can give you, the best lessons come from my own experience, now in 20 plus years, as a trader and now 12 plus years as a teacher. And if you go through my DVDs, video lessons, webinars you will see so much that really still applies in the current market. I know watching a DVD from like six or seven years ago you're like, ah, this website doesn't even exist anymore, these promoters don't exist, maybe not, but neither did the Mayans. Neither does the Egyptian empire, but we still learn about it because it's good to see what's worked in the past.
What's worked in the past often repeats and works again in the future. If you look at like shipping stocks, they get hot every few years. Crypto, the entire sector has gotten hot every few years.
Weed stocks have gotten hot every few years, specifically with the pandemic, out break stocks, like APT, which makes masks. When everyone was scared of Ebola, APT went from, I believe, like four to 12 in a few days. And now this latest pandemic it went from like four to 40, because this one actually spread everywhere unlike Ebola. So, start to recognize that stop and you'll see the same sectors, the same patterns. Sometimes even the exact same stocks.
DGLY makes police body cameras, every times there's protests or riots or civil unrest, look to trade DGLY and it sometimes spikes 20, 30, 50 a hundred percent like it's in a few hours or a few days. Like it's crazy how simple some of these lessons are but simple doesn't mean ineffective. On the contrary, some of my most powerful lessons are the most simplistic. You have to cut through the BS. I don't know a lot of these advanced technicals, I don't see them working with any high degree of reliability. So I just focus on what works for me.
And again, this is stuff that no one or very few of the losing traders do. They don't think like that. They follow other people's alerts, they're late to the game, they wake up like a minute before the market opens.
Sometimes they arrive in the chat room, like at 9:35 AM, the market's already been open for five minutes in there. They don't know what stocks to trade. They just want to trade whatever's hot. And it's like gambling to them. And why do you think casinos are so successful, most gamblers lose. If you look at who makes the most money in Vegas, sure, there's a few you gamblers who might make a little bit maybe they're good at like counting cards, maybe they're lucky, but the vast majority of gamblers in Vegas lose.
That's why the hotels and the casinos do so well, at least before 2020 when most of this stuff is closed. But when there's a lot of gamblers, it's just statistics. And with trading is just statistics. Most traders are gonna lose.
The difference between this and by gambling at a casino is that you're not just rolling die, you're not trying to guess specific stuff like this is research gambling, and I believe that there's higher odds if you are meticulous enough, if you're well studied and well-prepared enough. But most traders aren't, most traders aren't going to want to watch Tim Grittani 60 plus webinars that are available to my trading challenge students. You look at the number of views, it's pathetic.
It doesn't matter that Tim Grittani is my top student. They don't wanna watch a webinar from three, four, five, six, seven years ago which is a mistake. Tim Grittani, everything he says should be studied. He has done the seemingly impossible. I've done the seemingly impossible.
Now Jack Kellogg is doing the seemingly impossible. Are you seeing a trend yet? I can't guarantee you success. I can't guarantee you that you're going to be my next millionaire student but you can learn from your market history and you can learn from traders who are doing well, and take little bits and pieces from that.
But at the same time, just take it one day, one trade at a time. So many people are like, what do I do if the market changes? How should I short sell? How should I prepare to be a short sale? Like what? I don't know when the market will change. I don't know if it's tomorrow, three months, three years from now.
What if you're preparing to be a short seller and we have another three years of this bull market, that's gonna be a very tough three years, my friend. I don't want that for you. Maybe it's five years. After the pandemic of 1918 there was a thing called the roaring twenties.
That was a whole decade before the crash of 1929. So maybe we're set up for that too, I have no idea. I don't try to predict what the overall market is doing. I don't try to predict any stock or any future trend, especially in this really unpredictable world. One day, one trade at a time.
If the market goes into hibernation and I don't see a lot of the patterns working so be it, I'll size down, I'll trade less, I'll adapt and I'll listen to what the market is telling me. If I see a lot of plays and I'm making good money but I'm not taking enough size, and I start seeing the pattern work again and again, I'll take bigger size, and I'll say, okay Mr. Market, thank you for telling me what's working, let me take bigger size. And I'll try to take bigger size and if I do well, I'll be like, wow, that's working, I can afford to take bigger size. And then if it stops working I size back down or don't trade the pattern.
I referred several times to billionaire plays where I was trading so many billionaire plays a few years ago. Now, a billionaire investing in penny stocks, I don't even look at it, because I have yet to see one really spike that much, I mean, it's been years. So patterns come and go, strategies come and go, and you must adapt. That's what trading is all about.
Don't worry about a pattern that might work in two or three or five years. Don't worry about a pattern that worked five years ago. Focus on patterns that are working now. By all means learn the patterns that worked in the past, so you can start to learn the characteristics that created successful patterns and stuff like that, but recognize that the market changes. I don't know if you realize, like I've read a lot of stock market history books. I encourage you to do the same, even though you have more than enough DVDs, video lessons and webinars, especially if you're one of my challenge students, you have so much content to review that I think is the most useful.
But if you do want to go back in time and look at some of the best performers in the stock market once upon a time bowling alleys were the hottest sector. You wonder why there's so many bowling alleys in all these small towns across America because that was a hot stock several decades ago. Remember those big washing machines that you have, that that most people have? Washing machines used to be the hottest product and the hottest stock decades ago.
Now, if you look at like washing machine stocks or bowling stocks, like you think of like the most boring stocks ever, but decades ago when they were fast growing industries those were the best performing stocks. And if you don't know about the best performing stocks from decades ago you don't necessarily have the proper perspective. So perspective matters. And that's why I'm so proud to teach. It's not just about alerts, like yeah Tim, I know 90% of traders lose, I know not to follow alerts.
I know to cut losses quickly. And people like mock these rules that I try to teach, perspective, attitude, mentality, hard work this stuff all matters. I'm trying to give you a well-rounded education. It's not about any one stock. It's not about any one strategy. If you're truly gonna succeed, like I'm saying, over time there's gonna be multiple stocks, multiple strategies with you having to adapt and with you being okay to adapt.
This is an important one. Do not worry about what others are doing. Everyone has their own path. So take the good from the traders that you look up to and minimize the bad. A lot of people say, wow, Tim, like you've created a great community here, how did you know what to do? I took a lot of the bad from what traders I looked up to or I used to look up to, were doing.
A lot of traders, and I'm not calling out any names, I have no time for enemies or challenges or social media fights anymore, but a lot of traders don't post all their trades. And I was like, why is that? Like, I can't really learn from somebody who just says by this ticker, or says that they bought it and then they sold half and then you never hear about the ticker ever again. And I was like, let me create a website called Profitably which is what it turned into, where I just show all my trades. And I just say, hey, here's where I entered, here's where I exited.
Here's a video lesson on how I did well, here's a video lesson on how I did poorly. And you would be shocked at some of the messages I get. People that like, this is so revolutionary.
And I'm like, what? I'm just saying what I'm doing. But sadly, that's the industry. Never forget 90% plus of the traders lose. And if you look on Twitter, on any social media or financial community, it looks like 90% of traders are winning but they don't show their real names, they don't show all their trades, and you can't learn from traders who are so shady. If they don't show all their trades position size, plans, risk management, how can you judge? You can't, it's an incomplete education.
You can never succeed just following alerts from somebody else. You can never understand the strategy if you don't have all the details. Can you imagine going to a baseball game and looking up at the scoreboard and seeing the stats of like the next batter and just seeing how many walks they have, not seeing their home runs, not seeing their RBI's, not seeing their batting average. You just see like what college they attended. And you're like, what good is that? That doesn't show me what kind of player they are.
I need to see all the stats. And again, I'm not perfect, I'm very far from perfect. I'm very proud that several of my students have done better but learn from traders who are doing good, see what they're doing. Again, don't follow alerts from anybody but start to say, okay, Tim Grittani likes to cut losses intelligently which means he gives it more time. He actually turns off his profit and loss column because he doesn't want to be distracted by that. He wants to give the chart as much time as he can.
And that leads to what he calls paper cuts of like five or $10,000, because he has a big account now, but it also allows him to make a hundred thousand, 200, 300, $400,000 now on a trade when the chart plays out, and he doesn't have to take your paper cut. So he has lots of little five or $10,000 losses but then one trade of 400,000 wipes out all the losses and more over several months, it's pretty crazy. For me, I can't do it. I can't turn off my profit and loss column. I don't have any $400,000 profits. My biggest trade in the past was $200,000.
And that was years ago before I really clamped down on my risk management. So, you choose what works and you try to take some from traders, and you try to adapt. And don't feel bad if you try to take something from a trader, like an attribute where you're like, Oh I'm going to try to do this and it doesn't work for you. Okay, so then move on, try to adapt. This is all about adaptation. And that's what trading is all about.
This is not sticking to one strategy, sticking to one pattern, sticking to one method, sticking to one stock. That is the antithesis of trading. Trading is very flexible. And this is why I love it so much because you can really adapt and modulating everything from strategy, pattern, time, position size, risk management.
You know what sectors you like, whether you like to go long or short. I mean, all this stuff is up to you. And I really can't encourage you enough to try and tinker and see what works best. And that's why I also love stocks to trade, paper trading. You don't get a full education because you're not risking real money. It's like fantasy cash, but you can at least start to see how volatile these stocks are.
And you can start to see, Oh, I have to be in a breakout, like the minute it breaks out in this crazy market because five minutes later, it's already spike 20%. Or if you're dip buying a morning panic, like you have a little window of a few seconds or a few minutes. Or maybe if you're a longer term, you're buying a multi-day breakout, you can give it a few days. You don't have to be there right when it happens.
Try it all. Recognize that we're all on our own path. There's no one right answer to everything. That is so important to me.
And people really need to hear this because they're like, Oh, well I see all these other people making money. Or I see this person making money, relax. You're not that other person.
You're not on their path. Everyone has their own path. So my best students don't do well, they're confused, they're frustrated. But they use all that confusion and frustration to really dedicate themselves in year three, year four. That's when they start really succeeding. And not all years are created equal, 2020 is an amazing year for traders.
If you guys started in 2017, 2018, 2019 you have the perspective of a slower market. Now you're more grateful for 2020, but what if you're starting in 2020, you don't have that past mentality, you don't have that perspective, so you don't know what a slow market looks like. So those people who are starting in 2020, I would say that you guys congratulations for being in the right place at the right time (indistinct), but at the same time just recognize this is a very fast market.
And this is a heated up market, that compared to previous years, it's night and day. There's a reason why I'm making over a million dollars in 2020. A lot of it is because of Stocks to Trade Breaking News which has helped me so much but also because there's just so many more opportunities. And then lastly, this is a marathon, not a sprint.
Be patient, be dedicated, do not give up too soon. So many people not necessarily giving up but they're thinking about giving up and they're getting down on themselves and they're really negative. And I get like these sad messages where like I've been studying nonstop for a week and I don't get it, or I've been studying for a month or two months, or three months, and I'm like Tim Grittani might've made 13 million now but he made nothing his first nine months. And he's arguably the best penny stock trader in the world. So if the best penny stock trader in the world made nothing his first nine months, how do you think you're going to do? At least give it nine months, maybe even more.
And understand, his first nine months he was working as a state farm insurance agent, living at home with his family, like not an ideal setup to be a trader but he was studying every single night because he really wanted to do better. So, nine months studying every single night might be 18 months to somebody else who's studying every other night. So you really have to understand that this is not some kind of get rich, quick scheme. It's not gonna happen overnight. It's learning strategies, learning rules, learning lessons that have the biggest reward three, four, five, 10 years later, 20 years later. I'm doing it this 20 plus years into my trading career, I wish I had this knowledge in the beginning.
I wish I was this conservative, I wish I cut losses quickly, I wish I was a little bit taller, I wish I was a baller. I'm sorry, I'm losing my mind after filming all this. It's now 10:00 PM on Christmas Eve. Pretty crazy that I'm still doing this but I will want to give the tips to you that I had to learn the hard way over 20 plus years.
This is all stuff I wish someone had told me and you really need to buckle down and recognize that knowledge and success is earned over time. I know this sounds crazy cause I'm like a penny stock trader, I'm like a day trader, like, why am I so conservative? Well, this is how I've lasted, and this is how I've stayed in the game. Lots of people think Tim you're too safe you're too conservative. And these gunslingers, inevitably blow up. I have lost track how many gunslingers say that I'm overly safe, overly conservative, overly patient, trade too cowardly, and they found a better way, and they have all blown up.
They've lost 50, 75, a hundred, sometimes even 150% of their money. If you're short selling you can lose more money than you put in. So you're free to ignore these rules. You're free to ignore these tips but I'm trying to put you on the right path. I'm not a broker.
I'm not a financial advisor. I have no licenses. You can just say, hey, I don't agree with you.
That's fine. But I'm still gonna try to teach you what I've learned over two decades, and now what my top students are proving more and more and at a quicker pace in the past few years tips. So maybe if it was just me, you could say, I just got lucky.
Maybe if it was just me, you could say, okay these rules don't work for a lot of people, but for me I'm just so interested in trying to highlight the things I've learned over time. And I hope they help you. And these new tools like Stocks to Trade Breaking News and paper trading weren't even in existence when I first got started.
So study up, I hope you have a good holiday. I hope this has been useful. I really think it's good to review different plays, good plays, bad plays, everything in between. And all you can do is try to do better over time.
And try to buck the trend of most traders losing. And if you find your strategy, if you find your niche whether that strategy or pattern lasts for a little bit, I mean, it's really an amazing profession. It's an amazing skillset to have.
It's an amazing conversation starter. Like you have no idea how many people are like, teach me. It can be overwhelming, but I'm proud to share everything.
I hope this helps. And I don't know, normally I would say like hit me up but I'm just so overwhelmed. If you're in my challenge ask me questions during the challenge webinars. If you want Q&A with me, get in my challenge. Otherwise, enjoy all these blog posts, video lessons, commentary, watch list, trade alerts, tweets, YouTube videos, DVDs, webinars, everything that I give I try to teach in multiple formats.
And I hope I can help just to speed up your learning curve, that's all any of us can do. Anyways, have a great holiday have a great Christmas, New Year and let's make 2021 the best year ever, thanks.