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Trading Tips-Tim Sykes Penny Stock

3 Steps to Customizing A Winning Strategy

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Written by Timothy Sykes
Updated 5/26/2022 7 min read

Everyone gets into trading for their own reasons but with the same goal in mind — to make money.

I started this company more than a decade ago to help anyone who wanted to become a successful trader no matter their skill level or background.

Today, I proudly count 26 students who’ve made $1 million+ in their careers!

What many people don’t realize is that every one of my students who has achieved this level of trading mastery did it by developing their own style.

I simply gave them the framework to build on.

Mark Croock is a perfect example of someone who’s carved his own path.

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And someone I deeply respect and admire

And while I’ve carved out a niche for trading penny stocks…

…Mark has gone on to make millions in a totally different way.

And on June 2, he’s revealing his latest strategy for the first time — Shadow Trades.

If you haven’t reserved your seat for the Shadow Trades Summitthen click here now. 

Of course, we have a few days until then. So I want to talk to you a bit more about what it takes to develop your own style of trading and why it’s pivotal if you want to take your trading to the next level.

1. Match Your Lifestyle

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It’s so easy to look at someone like Mark (or myself) and think that just copying our strategies will bring you success.

I can’t tell you how many traders I’ve watched struggle to day trade while they worked 9-5 jobs.

Some of them probably got fired for trading on company time.

Don’t put yourself in that position.

If you don’t have the time to regularly dedicate to day trading, don’t try and day trade.

No, you don’t need to be in front of the computer all day.

My good friend Tim Bohen teaches folks how to trade primarily around 9:45 a.m. and 2:00 p.m.

However, you do need to be able to regularly set aside time to trade and do your homework.

Another thing to consider is how much risk you want to take on.

Few, if any, of my millionaire students hit the big milestone in two years, let alone the first year.

Many of my students start with small accounts and use them to learn how to generate profits consistently before stepping up their position size.

There’s no reason you need to risk $1,000 on a $5,000 account when $100 will do just fine.

I’m not an advocate for swinging for the fences on a few big trades.

All of my students look for regular, predictable trades, even if they earn the majority of their profits on only a few of them.

2. Journal Everything

I’ll be the first to admit I get caught up in my own world sometimes.

Between volatile markets, building schools in Bali, and running a company, I lose sight of the big picture.

No other tool will improve your trading faster than a trading journal.

It provides an unbiased assessment of where your opportunities lie and your weaknesses are.

This is crucial for strategy development. You need to discover which conditions work for your trades, how to execute them, and appropriate risk management strategies.

For example, I learned through trial and error how to execute my morning panic buy in such a way that I keep my losses small and turn busted setups into small gains.

That’s what happened yesterday in The Very Good Food Company (NASDAQ: VGFC) trade.

I managed to enter at $0.344 and exit at $0.35, walking away with a tiny profit.

This isn’t something I learned naturally. It took years of practice and trade reviews to fine-tune my execution.

And once I incorporated it into my trading, I started stacking up these small wins that eventually added up to some nice gains overall.

3. Adapt to Market Conditions

I said it once and I’ll say it again — some markets are for learning and some are for earning.

2020 and 2021 were amazing for profits.

2022 is much more difficult.

While there are strategies that can (and do) work in any type of market, I have yet to find one that doesn’t do better in either a bull or bear market.

Remember all those traders who made a fortune on meme squeeze trades?

They don’t have as much to work with these days.

If you don’t adapt to market conditions, you risk forcing trades, like shoving a round peg into a square hole.

Now, not every strategy can work in all market conditions.

That’s why journals are so important. Logging my trades tells me whether the strategy I developed works or fails, during bull or bear markets.

Sometimes I find a certain setup doesn’t work — or appear — under certain market conditions.

That’s why I worked for years on my core Supernova Pattern before branching out to setups like the morning panic dip buy.

Think of it like writing a book series. You need to complete the first novel to set the stage for the later volumes.

When Your Strategy Fails

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It’s easy to get discouraged when your favorite setup stops working. It’s happened to me plenty of times.

Take a step back and ask yourself what’s changed.

  • Has the shape of the market shifted?
  • Are you still executing the trades according to the plan?
  • Do setups fail or are there simply fewer of them?

Setups can work for years before suddenly faltering.

Traders who learned how to trade in 2020 probably picked up some bad habits from those unique market conditions.

That’s why I start my traders with patterns like the Supernova that worked for years, or the morning panic dip buy…

It gives my students a foundation to learn the market and build their own strategies based on setups that regularly appear.

And believe me, that’s a much easier place to start from than with nothing.

—Tim


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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (205) 851-0506 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”