Earlier this month, I got a call from one of my students, Strati. When I asked how things were going, this is what he said…
“It’s been crazy. I’ve had a roller coaster of a summer.”
It turns out Strati was in a drawdown and trying to find his way out of it.
Not only did he recover, but he asked me to share it with you.
I love it when students-turned-master traders pass on their knowledge to up-and-coming students.
I love it MORE when they’re transparent about the realities of trading.
In an industry full of scammers and fakes, it’s rare to find honesty and openness like this…
Strati’s Roller Coaster Summer
Every trader goes through drawdowns and tough periods.
When the best of the best share their struggles (and how they overcame them), we can ALL learn something.
Strati started the year off really well and was closing in on $400K profits going into July.
He even took some time away, going to Positano to hang out with me and other millionaire students.
Source: Millionaire Media: Positano, Italy
When he got home, his trading took a turn for the worse…
“I just felt like I had to come home and be so aggressive, as if I had to make up for lost time.”
What happened?
Strati lost roughly $20K between the middle of July and the middle of August.
Pay attention, because there’s a big lesson in what Strati did next…
The Power of the Pod
One thing Strati teaches is to beware of keeping it all to yourself.
Source: Millionaire Media
Strati teaching students.
Trading can be a lonely profession and it’s really difficult to talk with family members about it.
How do you explain to someone who earns money by the hour (or a salary) that some days you lose money?
Even if they get it, it’s tough to get helpful feedback because they’ve never experienced it.
So, Strati teaches to share with their pod — the group of traders who can help give insight into how they’re experiencing.
It’s one of the most important aspects of what we teach. Thankfully, Strati leads by example.
So, when the drawdown kept going, he got on the phone with me several times.
He also talked with Jack Kellogg and other students.
Guess what we all said to do?
• Wire money out of your account so you have less to trade.
• Reset your mindset to focus only on trading the best setups.
• Size down.
You might think this is weird advice to give a millionaire trader, right?
But think about it…
One of the most important things you’ll ever do as a trader is to learn how to adapt.
You MUST learn to adapt, whether it’s summer chop, or recognizing you’re getting sloppy or overaggressive.
Smart traders make adjustments before things get out of control.
So…
Strati Wired Out and Sized Down
Strati wired out almost all of his gains from this year and restarted with a little less than $40K.
For some people, that’s already a lot of money, but for a millionaire trader up almost $400K on the year, it completely changes your buying power.
Can you guess what happened? Strati has been doing MUCH better…
Source: Kinfo: Strati’s 1-month profit and loss graph.
In his words…
“Things have been going really well ever since. It’s something about trading smaller. I don’t know if it feels so much better, but everything is just a lot smoother.”
Strati has now taken that $40K account up to nearly $70K.
Not only has he recovered from his drawdown, but this week, he had a roughly $11K win with BTC Digital Ltd. (BTCT).
Strati’s Thoughts for You
Strati is SO dedicated to helping students.
Here’s some advice that he asked me to share with you (and my thoughts, too).
1. “Plan out everything in the morning before the bell. When I’m working with students, we plan everything out in the morning. We talk premarket stuff, that’s when we’re most active.”
The lesson? You MUST prepare every morning before the market opens. Only degenerates roll out of bed and start trading.
2. “Everybody should trade on their own at 9:30 when the bell rings. I tell everyone to shut their chat rooms off, log off, focus on yourself, focus on your process.”
I can tell you from experience, there’s nothing more frustrating than having your attention pulled in different directions while you’re in a trade.
The crazy thing is, SO many people choose to be distracted instead of fully engaged. Strati is right to point this out.
Huge props to Strati for his willingness to be transparent.
I asked him if he had any final thoughts, and this is what he said…
3. “If you are struggling, if you are losing, there are protocols you can take. You can size down. You can paper trade, right? You can put in rules, like you’re only going to take one trade a day, so that trade better be freaking good.”
This is GREAT advice.
It’s what I call the retired traders’ mindset. I only want to come out of retirement when the setup is so good that I’d feel guilty NOT taking the trade.
Every time I start to struggle, I put myself in a trading time-out and remind myself of the retired trader’s mindset.
Thanks again to Strati for sharing
Take advantage of your “pod” here. If you want to share any struggles you’re having with trading, email me at SykesDaily@BanyanHill.com. I’d love to share it with everyone.
Cheers,
Tim Sykes
Editor, Tim Sykes Daily
