Had Wi-Fi woes again so sorry I wasn’t able to update the blog. Catching up … it seemed that there is again a well-spring of hope regarding the (delay) in the rate rise in the US yet again. From my previous posts, you can tell I am bearish and my Wi-Fi was down so yes I am standing back from all the “rallies” and just looking at the opportunity for the downward move (if you notice, the falls are bigger, so, I just think they are a better risk 🙂
BUT … I wouldn’t want to ruin the party and say don’t buy it. People could get on it with a calculated Initial Risk (Dr Tharp calls this 1R) and make sure the reward is three times this risk (3R). See what happens with this:
Trade 1 – -1R Loss
Trade 2 – -1R Loss
Trade 3 – +3R Gain
Trade 4 – -1R Loss
Trade 5 – -1R Loss
Trade 6 – +3R Gain
Trade 7 – -1R Loss
Trade 8 – +3R Gain
Trade 9 – -1R Loss
Trade 10- +3R Gain
TOTAL = Loss of 6R (6x -1R)
Gains of 12R (4x 3R)
Over 10 trades, each costing you 1R, you have a net winning position of 2R (12R gain minus 10 trades of 1R). That’s still 20%.
In the above example, you lose 6 out of 10 times but keep the loss small (within 1R) and win only 4 times with 3R gains, you make 20% profit. We can do better than this of course but say for this very volatile market, we make 20% profit CONSISTENTLY, this is still a very good result.
If you do this monthly, you will be phenomenal with 240% performance
If you do this quarterly, you will be great with 80% performance
If you do this semi-annually, you will be above average with 40% performance
George Soros is a rock star trader at 30% per year performance consistently for decades.
I am going to have my last workshop for the year in Mid-November this is the highly popular Low-Risk High-Reward Investing Workshop that had people keep coming back to in order to learn how to do the business right! This is set for November 14 back to back with US Investing Workshop. Register early to avoid missing out on these 2 important workshops that will help you remain profitable and comfortable in this volatile market! Email us at firstname.lastname@example.org.