JWBK169-Lien July 3, 2007 13:56
Millionaire Traderswant to buy the 01s or the 02s. I need to know where I am out if
I am wrong. On every trade I always answer these two questions.
Number one: Why am I getting into this trade? And number two:
Where am I getting out if I am wrong? If I can’t answer those two
questions, then I can’t get into the trade no matter what the stock
is doing.
Another thing other traders always ask me is, why don’t I watch
more stocks? So I can have more opportunities on, say, days that
my stocks are not moving. My response is that I need to watch my
stocks—in case they do move, I want to be the first one to know it.
I try to know everything about these stocks, and I watch enough
stocks such that there is always something to do. Sometimes I may
trade less shares, sometimes more. But I have this little niche.
There are people who make a lot more money than me. But I am
one of the most consistent traders.Q: Speaking of that, and again obviously on average—wins versus
losses—what’s the ratio like?
A: So far this year I have traded every single day. So we’ve had
approximately 180 days so far and I have had four losing days. And
three of those days were$100.Q: On average, how many trades do you do? 150?
A: More than that.
Q: Really? So let’s for argument’s sake say it’s 250 round turns
per day. That means at six and half hours worth of trading it’s
almost a trade every two minutes or so.A: Right. I would say that’s correct. It’s nonstop.
Q: So that makes no single trade meaningful. You take losses
quickly and move on to the next one?A: Right. I just move on to the next one.