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Lessons From Students

3 Things My Millionaire Students Have in Common

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Written by Timothy Sykes
Updated 7/21/2022 5 min read

Folks who enter my Millionaire Trading Challenge come from all walks of life.

Mariana joined right after high school graduation as did Jack Schwartz.

Jack Kellogg parked cars as a valet before becoming another of my millionaire students.

Anyone can turn a profit in the market. 

But you won’t get there following social media promoters.

Many of these keyboard jockeys claim they have the ‘special’ indicator or edge to dominate the market.

Yet, as soon as the bubble bursts, they’re nowhere to be found.

In my opinion, anyone worth their salt should be able to back up their claims.

That’s why I log EVERY one of my trades here on profitly.

So what exactly are the keys to success? What do my millionaire trading students all have in common?

After teaching thousands of students over the last decade, I’ve narrowed it down to three key elements that every one of my student success stories has in common.

Master these three items and you’ll quickly discover more reliable and consistently profitable outcomes.

1. Manage Your Losses

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Trading is an exercise in risk management.

As a trader, I’m responsible for minimizing my potential losses and maximizing my possible gains.

Over the years, I found that most traders lose money not because they can’t win but because they lose poorly.

That’s why I always advocate and practice cutting my losers quickly.

Heck, if a trade doesn’t start winning for me quickly, I’ll drop it.

Take the trade I had in TBH Holdings Inc. (NASDAQ: PETZ) the other day.

While I managed to turn a profit, I quickly released my position when the stock failed to continue its rally.

If you look through my trade history, you’ll see dozens of trades where I only make $30 or $40.

These are positions I entered that failed to provide the required move.

Rather than hold and hope, I cut and run.

Now, what you’ll notice with these trades is that on many, I still manage to turn a small profit.

That comes with practice and patience.

You see, the first step towards profitability is removing those big losses that offset my gains.

The second step is to optimize your trades, getting better entries and exits.

Over time, this turned from small losses to small gains, which add up.

2. Adjust to the Market

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Markets can and do change.

As I tell my students, some markets are for learning and some are for earning.

The meme stock craze and bubbles built in 2021 created some of the best trades I’ve seen in my lifetime.

2022 has been much slower.

However, that doesn’t mean there aren’t trades, nor that you can’t be profitable.

Year-to-date, I’m up more than $80,000. While it’s not the +$1 million I made in 2021, it’s a heck of a lot better than the average investor.

And even throughout the year, the conditions can rapidly change.

Lately, I’ve seen many more multi-day runners and squeezes worth trading and fewer morning panic dip buys.

Three months ago, it was the exact opposite.

While penny stocks trade more independently from the broader markets, general risk appetites driven by the Fed and other factors all still play into the environment.

Put simply, if markets are crashing, penny stocks will struggle just as much to rally for more than a day or two.

3. Focus on Fewer, Better Setups

high frequency trading
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I earned most of my first $1 million with just one pattern.

Many traders I know only take 2-3 trades a week.

And there are some that trade once a week at most.

You don’t need a lot of trades to become successful.

Early on, I tell my students to work on just one setup that they feel comfortable with and get really good at that before expanding.

Folks who have never found consistent success need to build their confidence and a baseline to work from.

Otherwise, they’ll fear losing on every trade, which is a recipe for moving stops and a host of other bad habits.

Here’s some quick math to prove my point.

If you win 65% of your trades and risk $1 to make $3, starting with $1,000 and risking 5% of your account on each trade, you will hit $1 million in 90 trades.

At one trade per week, that’s a little under 2 years.

That’s why I want you in my millionaire challenge today.



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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”