timothy sykes logo

Trading Psychology

What’s More Important Than Money?

Timothy SykesAvatar
Written by Timothy Sykes
Updated 4/17/2023 3 min read

One of the worst days of my life was when I was handed the keys to my second Lamborghini.

I know that might sound strange to you.

But it gave me zero thrill…zero fulfillment… and zero sense of accomplishment.

It was just a very expensive “thing.”

That moment was life-changing for me.

I shifted from chasing materialistic stuff to putting my energy into helping others and starting a charitable foundation.

My charitable organization has donated over $7 million to over 85 charities and built over 100 schools worldwide.

And all of my trading profits are now donated to charity.

What gets me excited these days is seeing my students succeed.

Like one of my latest millionaire students, Eduardo.

His success as a trader allowed him to leave violence-torn Venezuela and give his family a better life.

Find out what trading has given him, and prepare to be inspired.

 

Trade For Purpose

© Millionaire Media, LLC

In my early days, I was a cowboy. I would take on large positions and be comfortable taking huge PnL swings.

However, that all changed once I discovered how much I could help people through charity.

I don’t trade for the thrill of the action.

I know that every profit I book goes to someone in need.

This helps me avoid reckless choices and keeps me focused.

For Eduardo, his purpose is family.

Trading allowed him to leave Venezuela, one of the most violent countries in Latin America.

In addition, it gave him more time to spend with his family.

When you work a 9-to-5 job, you’re helping your boss achieve their dreams.

But if you can make it as a trader, it can profoundly impact you and your family’s life.

And while trading is hard and comes with a steep learning curve, I argue that the risk outweighs the reward.

Without trading, Eduardo would have been stuck in Venezuela. But now he can be anywhere in the world.

Commitment Pays

© Millionaire Media, LLC

Most of my millionaire students started with a small account. Eduardo was no different. He started trading with a $1900 account.

And like my other millionaire students, his success didn’t happen overnight.

He continued to study and treated each day as a learning experience.

Most traders who fail want instant gratification. They want to make money right away.

But that’s unrealistic.

Eduardo knew that if he could continue to improve, he would eventually reach his goals.

He took his education seriously.

And is now able to spend as much time with his family as he wishes.

Take a second to watch this video to learn more about Eduardo:

 

If you feel inspired and want to take the next step, click here for more details.

 


How much has this post helped you?


Leave a reply


Author card Timothy Sykes picture

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

Post image

Get my weekly watchlist, free

Sign up to jump start your trading education!

* 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”