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Day trading has one huge and undeniable advantage over every other
trading time frame— Reduced Risk
The bottom line is this; position
traders and even swing traders must deal with overnight risk.
This shows up in those unavoidable gaps that happen between
the closing price and opening price every day.
Usually these gaps are small; but sometimes these gaps are
very big, thanks to news or market moves, etc.
And there’s very little protection against such gaps.
Traders and investors just have to make sure that stops are wide
enough to stay outside of the “market noise” and reduce their
position size accordingly.
Intraday traders don’t have to deal
with this overnight risk. This
allows them to use tighter stops and therefore larger position size.
We’ve all heard stories of people blowing out their
accounts while intraday trading.
This comes from abusing larger position sizes and a
combination of poor trading strategies and bad discipline.
Successful day traders capture the
advantages of increased position sizes by using strategies with
positive expectancies and applying good discipline to higher
frequency trades.
There are many elements that are
required to day trade well: good trading psychology, execution
skills, a decisive nature.
The eulogy for day trading
has been written many times in the past several years. Feeling the
heat from the Wall Street vanguard (who were having their profits
margins cut by hoards of stay-at-home traders), regulators made it
tougher for the "small player" to qualify. Day traders
have been belittled in the press as gunslingers. And the list goes
on…
So why does day trading
continue to thrive? Statistics show that a smaller cadre of day
traders are now trading more share volume in absolute numbers than the
vast hoards who had taken to computer screens. Day trading has some
inherent advantages that suit the temperament of a large number of
traders. Let’s take a look at these advantages and see if this style
of trading may have a place in your trading plan.
Advantage #1: No
overnight risk. For a trader
who is trying to stay in the game for the long haul, this is one of
the biggest natural advantages in the trading world. While we can
understand this advantage intuitively (sleep better at night, etc.),
let’s see if the concept bears any fruit quantitatively.
Here’s the
methodology: Test two similar hypothetical trade distributions. Each
distribution has the same expectancy and is tested across the same
number of trades. The only difference is that the first distribution
simulates intra-day trading and has its biggest loss as –1.5R, while
the second distribution used represents the effect of taking on
overnight risk by including a –5.0R loss in the distribution. This
simulates having a one-dollar stop and when a company pre-announces
reduced earnings and opens down five dollars. Here is our starting
data:
Percent wins: 55% for both systems
Expectancy: 0.12 for both systems
No. of trades: 500 per year for both systems
Biggest loss: -1.5R for day trading system, -5.0R for overnight risk system
What were our results?
As you can imagine, the volatility of our equity curve increased
greatly when we added the possibility of a big loss. Our average
drawdown doubled, while our average gain stayed the same. This alone
is significant. But the increased volatility had a much more telling
effect; the optimum risk size (defined as the amount of equity that we
could risk per trade to achieve the best reward-to-risk ratio) was 2.5
times smaller for the distribution that included overnight risk.
Advantage #2: Frequency
of trade. We can make a good
comparison of any numbers of systems if we know the expectancy and the
frequency of trade of the each system. For those of you not familiar
with expectancy, it is a measure of how much a system makes per dollar
risked. In the example above, you make 0.12 dollars, on average, for
every dollar risked. (For more information on expectancy and frequency
of trade please refer to Chapter 13 in "Safe Strategies for
Financial Freedom".)
Those of you who are
familiar with expectancy calculations may have looked at the numbers
in the previous section and thought, "an expectancy of 0.12 is
very low." But remember that expectancy must be coupled with
frequency in order to provide a meaningful comparison. Recall that we
assumed 500 trades per year using this system. At that frequency this
could be very profitable system, returning 60 percent per year if one
risked one percent per trade.
Remember that high
trade frequency is a double-edged sword. It makes systems with even
small expectancies very profitable. But it also turns systems with
negative expectancies into money pits. Having systems that work is
important in any style of trading, but in day trading, using a
strategy that doesn’t work can cause rapid disaster.
Advantage #3: Immediate
feedback. This advantage tends
to separate the day traders from the swing and position traders. For
many folks, immediate feedback is a very reassuring characteristic.
Lessons are learned more quickly. Positive actions are re-enforced
more quickly. For action-oriented personalities, day trading is a
perfect fit.
Day trading is not a
style that suits everyone. But for those that thrive on immediate
feedback and can make quick decisions, the benefits are many.
Co-presenter, Brad
Martin and I have designed a workshop that gives you detailed written
systems that can jump-start your trading.
For those of you who
are interested in day trading, this three-day course will be
extraordinary. We will emphasize the profitable use of the tools
available to a day trader in a unique way that you’ve probably never
experienced before.
Brad Martin traded on
the floors of the CBOT and the CME for 13 years before becoming an
extremely successful day trader. He knows what it takes to be
successful in difficult markets; his extraordinary trading profits
show that. And you’ll be as intrigued as I was to learn how the
secrets of a floor trader can make your current day trading more
profitable. Brad is a master at sharing his trading knowledge and will
help you take that next step to consistent trading profits.
Brad Martin left the
exchanges a few years ago. He has learned how to turn his floor
trading expertise into day trading profits. Brad’s profitable
trading strategies are presented in detail in this dynamic course!
Brad will bring the perspective of a floor trader who found great
success as a short-term trader after leaving the floor. His trading
strategies are a great complement to the trading process that Dr.
Tharp has pioneered and the systems that I have developed.
The technology we use
at this course is also incredible. You’ll learn the winning
strategies we teach, and you’ll actually trade them in our unique
simulated trading sessions using real-time data! You’ll be taking
home detailed strategies from us that work in today’s markets. You
can’t afford to miss this course!
My name is D.R. Barton.
And I’ve created this workshop along with Brad to show traders the
secrets that really work in day trading. I believe the valuable
information you’ll learn here will help make you a far more
successful trader.
Here are just some of
the topics that will be presented to transform your day trading:
• Electronic Tools:
How the Pros Use Level II, Time & Sales, and Charts for Swing
& Day Trading
• Trader Psychology
Part I: The Problems Short-Term Traders Have and the Solutions.
• Lessons from a
Floor Trader
• Trading Systems:
What Makes a Good System?
• Gap Trading Part
I: New Twists to a Proven Strategy
• Business
Planning: Transforming Knowledge into Profits.
• News Analysis:
Use the News to Read the Market
• Gap Trading Part
II: New Ways to Read the Gap and Trade in the Right Direction
• Expectancy,
R-Multiples & Position Sizing: Power Tools of the Professional
Trader
• Trading Inter-day
Trends: Powerful Strategies for Monster Profits. What We’re
Trading TODAY!
• Gap Trading Parts
III & IV: Complete Your Trading System Arsenal for This Powerful
Tool
• The Most Powerful
Strategy for Consistent Profits That We’ve Found: Morning Pops!
• Trading
Psychology Part II: Making Changes That Will Super-Charge Your
Trading Performance
• Trading Plans:
The Key to Consistent Trading Profits
• The Trading Day:
How to Prepare, Execute and Debrief
In this course, not
only will I reveal some "edges" I’ve discovered, but more
importantly, with the use of Dr. Tharp’s techniques, we will show
you how to develop your own edge.
This knowledge alone is
invaluable.
Learn How to Profit
When Everyone Else Is Losing
Your experience could
be more rewarding if you pay attention to certain key principles that
are essential to the success of every short-term trader who makes it
in the long run. In this course, you’ll learn how to apply the real
business concepts for traders that I’ve helped pioneer, as well as
how to apply the key principles of R-multiples, expectancy, position
sizing, and discipline to achieve your dreams through day trading.
These are concepts that most traders have never heard of or applied to
their trading.
Here Are Eight Specific
Profit-Making Reasons Why You’ll Want to Attend This Course
1. You’ll
learn specific strategies, each of which could make you over
$100K/year. For instance, I’ll show you how to make very safe,
fast and dependable profits from trading two or three times a week
for only an hour or two a day. This proven strategy alone is worth
the price of the whole course.
2. You’ll
learn the keys that allowed Brad to move successfully from the floor
to the terminal. Traders who have never even seen the trading floor
will benefit from these concise tips on how to read the markets.
3. Live
trading!! Brad and I will trade live and show you some of the
strategies that have been taught. This is real trading with real
money. Many have found this to be the most informative part of the
past courses that Brad and I have taught.
4. You’ll
learn some of the critical issues for effectively setting and
keeping your stops in fast paced markets. This is the type of inside
day trading information that is not found in trading books!
5. You’ll
learn how to track a basket of stocks like a pro. Learn Brad’s
edge that he gains from reviewing his basket of stocks on a routine
basis. This is the type of information that turns trading from a
"hot one day, cold the next" endeavor into a consistently
profitable experience.
6. Brad will
teach you the finer points of day trading that make him a successful
professional trader. These are proven strategies and tactics that
Brad uses every day. And we’ll use our real-time trading
technology to make sure that you know how to apply them before
you leave the course!
7. You’ll
discover some psychological tools that will help you achieve
repeatable success, some key areas that impact short-term traders
even more than the average long-term position trader. Because your
mental and psychology activity is so important to your trading
performance, this may be the session that takes you to the next
level!
8. Last and
perhaps most importantly, you’ll learn the true power tool of
professional traders—position sizing. Top traders know that they
have to increase their trading size when things are going well and
cut back when trading is not so productive. We’ll step you through
a simple process that will allow you to get the most out your
trading and supercharge your results.
Position sizing is an
area where Dr. Tharp has been a cutting-edge leader for years. We’ll
play a version of his famous simulation game where you can learn the
true value of position sizing and the difference it can make in your
trading.
We’ll be covering
stocks and futures in this course.
You may be skeptical
about why we offer such great trading strategies at a course. To help
you with your decision making process so that you can come and learn
to master the markets, we offer a "can’t miss" guarantee.
If you’re a success-driven person who is willing to apply the
techniques you’ll learn, then we are willing to guarantee that you
will be totally satisfied with the course. In fact, we’re willing to
offer the best guarantee that anyone has ever offered to you in a day
trading course.
What Attendees have
said:
"Very good! It has opened my eyes
in many aspects of my trading." —Jaroslav Dorda, Czech Republic "This
course provides the essential basics that every person who wants to
become a day trader needs to know to have a chance of succeeding.
Plus, offers concrete examples of trading systems that provide models
of how to develop your own systems based on your beliefs."
—Roman Franko, Toronto, Canada "The
course was excellent, well organized, great delivery, very practical,
and clear, as well as extremely interesting." —William
Trousdell, Florida "The
course was fantastic and D.R. and Brad are excellent teachers. I flew
in from Hong Kong for one course and it was well worth it!"
—Chris Aiello, Hong Kong "Provided
more than I expected, great introduction to day trading tactics."
—R. J. Hixson, North Carolina "Overall
an excellent class. Both speakers are very knowledgeable, both are
very honest." —Joel Rosenstock, New Jersey "Very
informative and practical. No fluff, and some outside-the-box thinking
was refreshing." —Jeff Jordan, New Hampshire "Extremely
well done course. Great insight into the preparation and execution of
a professional day trader's day. I appreciated the combination of
rule-based and discretionary approach to trading the same system. Time
spent on the 'softer' areas of expectations, and progression of a
trading career, financial rewards and skill building were great. —Ed
Pomicter, Vermont
"The course was very well done. I
thought the systems taught made day trading more understandable and
within reach of my own abilities." Frank Eaves, CA "Good
course. I learned a lot." Emiel Jegen, Netherlands "This
was very well designed for a very diverse class." Joe Pleasants "Excellent
course. Especially like the realistic expectations presented and
appreciated the lack of unsubstantiated techniques." Al Calvano "I
am leaving this seminar with a solid foundation in day trading and a
clear understanding of how to place a proper stops and determine a
profit target." Dwight Lintz "I
thought this was a fantastic course. The instructors were a great
compliment to each other and the content was great and very
helpful." Mark Holland
What our students said
were among the top five benefits they received:
- Being able to ask experts questions.
Getting answers not easily found elsewhere.
- Technical details of trades.
- Increased confidence.
- Fellow classmates, caliber of
attendees and comparing ideas.
- Learned a way to shorten time frames
and increase opportunities with relatively low risk.
- How to layout and prepare for
trading in the market.
- Great systems!
- Live trading.
- GAP strategies.
- Understanding the psychology
of a day trader.
Satisfaction Guarantee
Come to the Day
Trading course, listen to the discussions and participate in
the exercises and simulations. Then,
if by 12 noon on the second day you are not totally satisfied with the
course, just return the course materials to a staff member, and
we’ll refund every penny of your tuition.
You’ll get the benefit of the first half of the course, and
we won’t charge you a cent. That’s
a totally risk-free opportunity for you.
Why such a guarantee?
There are two excellent reasons:
By us absorbing all of the initial
risk, you’ll be more likely to come.
Our objective is to really help you.
As a result, we’re willing to make it very easy for you to
attend. We can afford to take all the risk because we know the quality
of the course and the quality of the materials that will be presented.
Consequently, we know that chances are you’ll be delighted
with it.
Most investors who are really
committed to doing research will probably spend a significant amount
of money and time just to find the same information that will be
presented at this course.
Act
early and save over $500
Brad Martin and I will teach you everything you
need to know to be successful at Day Trading.
If you pay in full by the early enrollment
date, you can deduct $500 from your tuition.
In addition, if you come with a
business colleague or family member (who’ll attend the course with
you and who is not currently a client), we will give each of you
an additional $200 discount.
You can combine this discount with the early enrollment
discount and save as much as $700.
So mark your calendars now to attend this course on Day Trading.
To register call 800-385-4486
(919-466-0043) or on line at www.iitm.com.
Click
here for location and hotel information.
Also register early. Attendance will
be limited so I suggest you enroll now.
Sincerely,
D. R. Barton, Jr.
Enroll
Now
The
legal stuff we have to add: Obviously
you are responsible for your own trading results and individual
results vary. There is a very high degree of risk involved in
stock trading. Posted past results are hypothetical trades. Results
do not reflect slippage, commissions and other market risk factors
inherent in actual trades in the stock market. Past results are not
indicative of future performance. IITM and all individuals
affiliated with this course assume no responsibilities for your
trading results. The strategies, lessons and all other features are
for educational purposes only and should not be construed as
investment or trading advice. You must assess the risk of any trade
with your broker or financial professional and make your own
independent decisions regarding any trades.
PLEASE NOTE:
Due to the unique nature of this course, IITM course packages
and other discounts are not applicable to this course.
Three and Six Pack customers can pay an upgrade fee to attend
this course under their package plans.
Please call IITM for exact pricing of the upgrade.
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