Thread by @BambroughKevin

In the early days of my trading I decided to try to develop a ‘system’ or ‘style’ that would work for me. After reading piles of investment books coverjng all sorts of disciplines I eventually refined a technique.

So I started by trying to decide first of all if a sector was in a sustainable bull or bear and no matter what never trade against the over all trend. Long only in bull sectors. Short only in bears.

Next I try to read all I can on the companies and sector as well as other economic factors that influence so I’m reasonably on top of things fundamentally and trying to long the best of the best.

Then using technical analysis I try to work my way into investments profitably.

Early days I would do a lot of shorter term trades because I lacked experience and the conviction to really stay with things. But, I managed to do well enough to make a career

I often would say that my goal was to be right just a little better than 50% of the time. But lose 1 when I’m wrong and make 4 when I’m right. I ‘grew up’ trading full time in a sort of day trading shop where people paid for their desks with commissions or had to pay a fee

There was a lot of pressure to trade and pay commissions and lower commission costs. (Lower fees with volume). I stuck to my system and I watched countless people come and go, often wrecking their life savings.

Biggest problem is most people hate admitting they are wrong and taking losses. They let them grow beyond plan. Also many, will hold a loss 10-20% against them. But then quickly take a 10-20% profit. It’s all easier said than done but learning to develop realistic expectations

Is a key. If you don’t understand risk to reward you’re screwed. Very difficult to judge if it’s a 50/50 bet that you’ll make 4 and only lose 1. If you follow me? But if you can’t do it on a small scale no point doing it on a larger scale. Or with more volume of trades

The good thing is that if you really dedicate yourself to learning and start slow and track yourself. Especially your ability to stick to the plan, then you can make it and it will be very rewarding.

But just know if you lack the discipline to sell when you said you would your destined to get smoked badly. I’ve seen many a trader that has a great run. And bull markets are great at convicting people they are geniuses. But, there’s often nasty corrections for 50%

Many 30% check backs along the way. Geniuses with margin get destroyed. Margin selling is shocking to see. Stocks just relentlessly getting pounded by people that are forced to liquidate. Plus bad market corrections change the economy and inflation quickly destroy themes.

If your a resource investor and plan to try to play this entire bull, just be careful and not too greedy. This particular resource bull is gonna be super volatile

The commodity inflation and supply chain issues generated by from attempting to double the power grid and a switch to electric cars is going to lead to mini recessions along the way.

High power prices and general inflation will change consumer spending.

One thing I’ve always done is force myself to take a bit of profit after a great run and then buy something somewhat non correlated.

I think raising a bit of cash from winning resource sectors and accumulating gold and silver will work out well and also help me sleep at night. :) I hope

I’ve also found that as I’ve gained experience and refined my sector and stock picking I’ve continue Li improved my percentage right vs wrong while holding the 1-4 total loss vs total gain rule. Plus, the 10x stuff comes around every now and again.