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Trading Psychology

Dan Bilzerian is right

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Written by Timothy Sykes
Updated 9/29/2022 5 min read

My thoughts and prayers go out to anyone affected by hurricane Ian.

The world is full of strife right now. That’s the main reason I continue to trade.

The profits aren’t for me … I donate them.

Last year I managed to raise $1,076,441.30.

This year I’ve raised $117,061.18 so far.

I used to own a bunch of exotic cars. I dated models. I spent my money on parties and material things.

It was fun for a while. But it didn’t make me happy.

I watched a video where Dan Bilzerian admitted the same thing.

Dan is a famous gambler and social media influencer. He’s most popular for Instagram photos with tons of expensive toys and gorgeous women.

But even he realizes, somehow it’s not enough.

Money gives you freedom. And what you do with that freedom, will make you happy.

For me, it’s philanthropy. I like helping people. So I sold all my cars and started a  global charity called Karmagawa.

Here’s the link.

Trading gives me the money and the freedom to do what makes me happy.

If you’re looking for financial freedom, the stock market offers you that opportunity.

Especially if you’ve got a framework to follow. It’s helped me stay profitable, even during the bear market, and I want to share it with you right now.

Here’s how that framework helps me profit right now …

My Bear Market Plan

Tim Sykes prepares for a potential market crash in 2022
© Millionaire Media, LLC

First of all, we’ve got to look at the current market. And it’s not pretty.

The major indexes are hovering above support, ready to plunge lower. Here’s a chart of the S&P 500 ETF Trust (NYSEARCA: SPY)

SPY chart 1-day candles Source: StocksToTrade

Remember that three out of four stocks follow the market. A bear market means fewer spikers.

So when I follow my framework, I’m not paying attention to points 1-3 …

Here’s a link to my trading framework if you’re unfamiliar.

Points 1-3 represent the initial price spike. But in a market with fewer spikes, it’s not a reliable strategy to follow.

Instead, I’m focusing on the panic dip buy. That’s points 4-5. Here’s a chart …

The idea is to find an overextended stock, wait for a price crash, and then trade the bounce.

Here’s a link to the pattern I use.

There’s one last important aspect of this strategy. Keep tickers that successfully bounce on your watchlist.

I’ve seen the same stocks bounce over and over again. Take a look at the chart above again for proof. Every ‘5’ is a dip buy opportunity before bounce.

I don’t expect to catch every opportunity, but it’s always good to remember there’s more than one chance. So don’t stress out.

My #1 Key to Financial Freedom

© Millionaire Media, LLC

A lot of people are looking for happiness out there. At the very least, some financial relief from this historic inflation.

I’m blessed with the knowledge to trade profitably. And trust me, I give thanks every day. Some people won’t ever get the chance at this kind of freedom.

But you do …

By clicking the link to this letter, you’ve brought yourself one step closer.

But if you want to get there faster there’s one thing all my millionaire students had to do before becoming profitable.

They clicked this link.

This is your chance.

Grab it,

— 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

* 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 (888) 878-3621 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”