Why Is The Obvious Not So Obvious?

themickey · Nov 14, 2021

jackorthman said:
Hello! I am Jack, a brand new member in this forum and I am actually looking for some information rather than telling my long stories, but since I hit upon this thread I would like to express my trading strategy and the reason I will disagree with most of the opinions written by others in regards to How To Be Successful With Trading the markets.

I am 71-years old, started trading when I purchased gasoline company stocks like Texaco when I was 15-years old. I traded millions of dollars every year both long term and day trading. I developed a software program that teaches traders how to trade and the risks for stocks and 52 different stock and option combinations and I wrote a 120-page book for trading stocks and options.

I've been around the block a few thousand times and I've made a lot of money. I've seen many of my acquaintances do great things like turn $50,000 into more than one million, but don't get excited because trading the markets for most successful traders is exactly the same as gambling at a casino. When you stay in the game long enough almost every successful gambler and trader eventually loses, cannot recover and they silently fade away and out of sight.

Since 2001, I made more than $35 million investing in apartment buildings in Los Angeles and I almost never earned less than 35% per year on my money. For many years, the price of apartments doubled year after year, but today it is getting difficult to make more than 5% to 8% annually on my money. So, I am now going back to trading in the stock market and I will still keep my cash available just in case a good real estate investment falls in my lap.

This is how I made millions of dollars investing in both real estate and in the stock market. I do exactly what Warren Buffet does that is well-know, but not expressed as much as it should be and there is good reasons what he does is no expressed as much as it could be.

The most-important thing almost every trader fails to evaluate is the true risks and all you need to do is create a chart. A Risk Chart will show you that your risk when investing in a stock is you can lose 100% of your money. The chances are you won't, but for people who do day trading and for people who don't have the patience to ride out short term crashes then a very high percent of day traders and people who can't handle the short-term crashes do lose 30% to 80% on stocks and I've seen many decent stocks drop to zero. So, since stocks have the potential to lose 100% of your investment then smart investors need to focus on well-known stocks that have assets to back them up.

I am going to try to shorten this, but it is difficult.

Investors should pay special attention these three old sayings.

"The Rich Get Richer"
"It Takes Money To Make Money"
"Cash Is The King" (or something like that)

Why does Warren Bufffet make so much money? Because he is rich and and because it takes money to make money. So, when a stock price that has great assets to back it up crashes then Warren Buffet has enough cash to buy thousands of shares and invest millions of dollars in one stock. It is not because Warren Buffet is smart. It is because he has the cash to invest when a great opportunity falls in his lap.

Going back to my story like about people who turned $50,000 into a million dollars by trading I want to make it clear that those people traded the wrong way and eventually lost all their gains and then some because they always ignored their inherent risks.

This is how I made millions and millions of dollars investing in both real estate and in the stock market. It took me about 40 years to learn how to be patient like an alligator. It took many years to realize that I would make many times more money by not having my money invested in the stock market and I learned how to keep my cash available so I could make purchases like Warren Buffet for what I call Stock Market Crisis Days.

If you look at the history of stock market crashes (or Crisis Days) you will see there is a huge dip for virtually every stock approximately every 2 years. The last huge dip was February and March 2020 when COVID-19 scared everyone.

This is only an example. There was a taco company stock that was going for around $8 for several years. In March 2020, the stock dropped to $2.50. I purchased 20,000 shares $50,000 investment) and sold it for $9.00 about 8 months later making my profit $130,000.

Most traders have anxiety and they want to be 'In The Game' 24/7/365, but I've been down that road and the 24/7 watching the market, worries, trading, making small gains and taking losses is a seriously crazy way to live our short lives. It is seriously fun to make trades, make huge bundles of cash and then focus on other things that are more-productive and fun.

During the last crisis in 2020, I had just purchased an apartment building and had only $50,000 cash in my bank accounts, but had my accounts had $1 million, I would have invested every penny in low-priced stocks like Del Taco (symbol TACO) because your profits are almost exponential when you invest in the low-priced stocks that increase in value by 200% to 500%.

For the Del Taco purchase, I made 260% on my money. The investment was a No-Brainer. I never looked at the stock's price more than 1 time per week, never worried, never crossed my fingers and I spent my time running my business and doing things with my family without the stock market on the back of my mind every minute.

Currently, I have a ton of cash in my bank account. I even have a $2 million line of credit with a $250,000 limit on a credit card. I have two more credit cards with $40,000 limits and when the market tanks again in 1, 2, 3, or 4 years I will invest every penny I have in stocks that tank like Del Taco. I eliminate all the inherent risks that come with long-term and day trading stocks and when earning 200% to 500% I will always beat the long-term and day traders.
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Overnight said:
Go post your CV on a forum that actually gives a shit.

P.S. One other bit...You have a $250,000 limit on a credit card, but cannot afford an AMEX Centurion card? You know those cards have NO limit, right?

You are quite astute.
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Sorry to hear that on your first two posts on ET you been hammered by 'elite traders'.

M4-1 · Nov 16, 2021

many times i have put on limit orders to open or close a trade..and many times the price has hit my limit order and i was never filled..

today it nearly happened again..twice price hit my limit order..and it was not until the third touch was i filled..

it is very easy to get sucked in as you watch the DOM..and you can make some very bad decisions unless you have a process to follow!

18:00

18:54

19:00

SunTrader · Nov 16, 2021

Lovely miiiiiiiiiiiiiiiiiiiile long graphics.

Meanwhile CME is FIFO so the price might be touched but not a particular limit order. Happens.

M4-1 · Nov 16, 2021

yes..i know..there are some providers that can show you your place in the que..but not required if you are "on the job"..

there is something interesting that has caught my eye..two evenings in a row now..have been away from this lark for a while so steady as she goes..

i am..however..convinced that if you pay too much attention to the dom then you will get sucked in like the majority do..best to always have the bigger picture to hand..and more importantly..USE IT

another long miler for you !

SunTrader · Nov 16, 2021

No more for me. C ya.

Onra · Nov 17, 2021

M4-1 said:
many times i have put on limit orders to open or close a trade..and many times the price has hit my limit order and i was never filled..

today it nearly happened again..twice price hit my limit order..and it was not until the third touch was i filled..

it is very easy to get sucked in as you watch the DOM..and you can make some very bad decisions unless you have a process to follow!

18:00
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18:54
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19:00
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Very interesting...!!!
So you knew where price would go 60 min. into the future...

M4-1 · Nov 17, 2021

Onra said:
Very interesting...!!!
So you knew where price would go 60 min. into the future...
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no..but i had a good guess based on the charts..after todays few trades one thing is coming back to me..that is..you have to be fast when required..and you really need to use that reverse trade button if you are doing short term trades..you can call it YoYo trading if you like

i am a little worried that i have no losers yet..not a good sign..means i am not clued in and risking it a bit by doubling up..much better to be clued in and use reverse trading..anyway..steady as she goes!

this was the limit order to close the last 2 longs..took on a bit of risk here in doubling up..not happy with that at all!

M4-1 · Nov 17, 2021

i think i will stop now as i make that $75 for today and want to hold on to it until at least tomorrow..be interesting to see if we close between 4683 and 4693 !

anyone else testing the MES?

M4-1 · Nov 17, 2021

i couldn't resist the final countdown

Overnight · Nov 17, 2021

M4-1 said:
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anyone else testing the MES?

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I don't test, I trade. You should think about doing that as well. Less testing, more trading! Take advantage of your chops while you still have them!