If you don’t live and breathe the financial markets, you are almost destined to fail unless you…
by Chris Vermeulen of The Technical Traders
I’m often asked if everyone could be a profitable trader or investor. My answer is no, and the message I received from what I call a forecast follower paints the perfect picture, and I’ll share that with you here.
Some people just do not have the knowledge, emotional strength, and self-discipline to succeed, and many are unwilling to put in the hard work. It’s unfortunate that if you lack any of these three critical things, you fall victim to trading other people’s forecasts and predictions which is a losing strategy, and I’ll explain why that is.
I recently presented to a group of 900+ Traders and investors about challenging the status quo buy-and-hold method and how to create a bear-proof investment strategy. Before I started, I made it very clear to everyone that trading and investing, in general, is only suitable for a very select group of individuals. And if you don’t fall into the first category, you are more likely to fail. But on the other hand, if you happen to check both boxes, the higher your chance of building a sizable trading and retirement account you can live off of.
Those who can be exceptionally good traders and investors are:
- Successful professionals (doctors, lawyers, pilots, engineers, dentists, etc.), entrepreneurs, and retirees. Why? Because these individuals have the drive to learn, the grit to do what is needed, and the focus to execute detailed plans. Each of these traits is critical for success in business, and trading and investing is a serious business.
- People with large account sizes. As we know, it takes money to make money, and those who already have a substantial amount understand the value of protecting your capital and the power of compound growth.
Not a successful professional, entrepreneur, or retiree? Here’s how I did it.
I was fortunate to grow up in an entrepreneurial family. My parents were professionals and owned their own hearing, and dental businesses, lots of real estate, and other very unique and lucrative ventures. I grew up watching my dad listen to audio cassette courses of all types, and my sister and I were dragged out to several weekend events around motivation and success. I saw Zig Ziglar a couple of times in Toronto and got pulled up on stage with him. I think I was only like 12 years old then. Even now, I still enjoy listening to Zig and Jim Rohn and have my kids (10 and 12) listen to it. Even though they don’t really know what it’s fully about, I see them picking up on the core points with this Jedi mind trick type of education.
Please keep reading, as this story is leading us to the main point on gold and silver forecasts and how I made my fortune in the financial industry by creating a mindset for success. If you don’t have the correct mindset and understanding of the markets, you’ll end up following forecasts and predictions until you are broke.
Going back to all those success talks I was exposed to as a kid sparked a fire within me. I have read all the great books and many more. Think And Grow Rich is a must-read if you want to figure out who you are, what you truly desire, and what your calling is. My calling was to become a highly successful trader and to create the best strategies to help others manage their own money so they can be financially free and live off their investments without having to work. I feel I’ve almost achieved it with my strategies to do this, but I know there is room for more improvement.
It’s never too late to start fresh and turn a new leaf, whether that’s to start a new profession you are passionate about or dump your portfolio positions that are causing stress and wiping out your retirement plans. “You can do anything; you just need to want it bad enough,” as Jim Rohn always says.
Thankfully I learned what my calling was at 16 and have been trading and investing for over 25 years.
But with that said, I know a gentleman who retired in his 40’s, then went bankrupt in his 50’s, then a few years later, he was 10X wealthier than when he retired the first time because he was able to start fresh and follow his passion and use his skills and energy to the fullest extent.
Other great books to become a well-rounded, successful individual:
– Richest Man in Babylon
(My favorite book about money/wealth – I save)
– The Millionaire Next Door
(I see what this book talks about happening all the time – I’m not flashy)
– Investing in Duplexes, Triplexes, and Quads: The Fastest and Safest Way to Real Estate Wealth
(I built a full retirement income in 5 years – cash for life, with massive nest eggs)
Have you ever done a personality test? You should, it will help your trading.
Well, depending on the website that tests you, I am called a Scientist or a Logistician (INTJ or ISTJ). I’m not a follower. I can’t stand rules, regulations, or being told what to do. I prefer to do my own thing. I build, test, and break things, and I do it well as the introvert that I am. I’m not so much of a leader but will stand up for what I believe in if something does not make sense and seems incorrect because my personality type states that I also believe that I am generally right when it comes to things I put my focus towards. In a way, I almost see myself as the character Data from Star-Trek, as I run on logic and try to make the best decisions for success.
Unlike Data, I do have feelings and emotions, which play a critical role in my trading and investing models, and are part of what makes what I do successful, so don’t be fooled; emotions are useful when it comes to trading strategies.
Anyways, while I may not be focused on being a leader when people follow me, I’m more than happy to help, and I love sharing what I do with like-minded individuals, and I do this at TTT.
The bottom line, once you understand what it takes to be successful, you have that skill for life, and the more things you do, the more times you try, the more successful you will be. This leads us to what happens to those who lack stock market, trading, and position/risk management knowledge.
If you don’t live and breathe the financial markets, you are almost destined to fail unless you have systems and rules or professional help.
With all the data, news, and opinions littered across the web, it’s easy to get sucked into the hype, forecasts, and predictions that are aligned with an asset you like.
There is no room for love in the financial markets. You can’t buy and hold an asset just because you love their product and hope that it rises because some article or blog post paints a pretty picture of it rocketing higher to a price that will allow you to retire. Instead, we need to look at our investment positions as rental properties. We buy an asset (rent it) until we make the return we expected or it is no longer trending in our direction, at which point we sell it back to the market. There should be zero relationships or love for your investments. Rent it, make your money, get out – wham-bam, thank you, market!
I have been sharing articles and forecasts online since 2001, and I have seen my fair share of bitter traders who blindly follow free content, dump all their money into a trade with no regard for risk, and do nothing to manage their position. You know what happens when the asset fails to move as expected. The trader sends a raging email about how wrong the forecast was, a lot of blaming, and usually some colorful name-calling from the individual, I think you get my point here.
Don’t get me wrong, I get they are upset, they may or may not have lost money, and they need to vent, so why not send an email to someone nice, trying to help and share ideas/possibilities, which are NOT specific trades.
In short, if you don’t fully understand how the markets move and how to find your own trades and manage them, then you need to follow a professional who does. If not, you end up cutting corners and making trades based on some really interesting articles you stumbled across because you like its forecast of where the price may move to in the near future. But that is no reason to enter a position, and I don’t recommend following this method of trading.
If you know anything about how I trade and invest, then you know I follow price trends. I will never buy something in a downtrend, and I don’t short something in an uptrend. Sounds simple right? You would be surprised how many people lose money in a raging bull market. A study I recently read said that out of 10,000 brokerage accounts in the USA, only 26% of the accounts outperformed the stock market. Over 50% lost money, and the remaining 24% didn’t really make anything during a multi-year bull market rally. In a perfect environment to make money, most people lose money. Trust me, people love to bet against the market, there is a gambler in all of us, and I know I’m a gambling man, but I can control those urges most of the time because the “Data” in me reminded me of the odds of losing my money.
A recent email from a gold forecast follower who is bitter
To paraphrase what it said:
“Two years ago, you and your team forecasted gold to be $3500 within a few months, I’m still waiting, and there has been no remorse, or apology for the spectacular miss. I’m still waiting for the research team to recant that forecast. I should have bet against your forecast, that’s on me…”
Yes, I posted about $3500 gold, in fact I know I posted about $5500, and $7400 as well in some of my articles a few years ago. They are just opinions and interesting angles if the stars were to align, and that could possibly happen, but as we know, the stars don’t typically align for anyone.
Examples of some interesting gold analysis, but none of these are a strategy or trade, just visualized data.
Also, while this person is convinced this was an official trade I made. If you know me at all, then you know I manage every trade very closely and close trades that are not working out. There is no two-year-old gold trade open waiting for a $3500 target that I can assure you. But, I do think that there will be a great trade in gold in the coming months once the price confirms and gives us a new signal, which will hopefully be at a much lower price from where it is now.
Remember, free content online needs to be different, interesting, or extreme to get people to look at it. News and articles are nothing more than noise (garbage) for the educated and successful investor who already has proven strategies like BAN or CGS to make money and build their wealth. We trade with the trend, not our hearts and emotions.
Concluding Thoughts:
The reason why I focus on helping already successful individuals is that they get it. Attitude is everything. The raging forecast followers with minimal understanding of how the markets move and risk management are generally very frustrated, angry, and bitter people. I no longer work with anyone who is negative or rude to my team or I. It is that simple.
I learned many years ago that you can’t make people successful. You can’t lift or pull people into becoming successful, well maybe temporarily, you can get them pumped up and moving, but if they cannot keep themselves motivated, driven, and excited to get to where they want to be, they are destined to fail. I have helped many people like this, hoping I could help them. But the bottom line is, if someone can’t carry their own weight while you are helping them, then they are simply slowing you down, and I do not like to be slowed down!
This article, I feel, turned into more of a rant than about trading gold forecasts. I apologize if it’s way out there in left field. Still, I wanted to share what was going through my head after receiving the forecast follower email and how knowledge, drive, and attitude are critical for all your successes in life.
If you enjoyed this article, please share it with others, and be sure to join my free newsletter and have more articles like this delivered to your inbox.
Chris Vermeulen
Chief Investment Officer
www.TheTechnicalTraders.com
