WHY I DON'T TRADE ANYMORE...

Why did I decide to stop trading? This is not a clickbait video. I really mean that. I want to stop trading. And today I want to explain to you why, why I came to this decision. That may surprise some of you because you know, I've been uploading in the last couple of years many videos discussing about trading topics like position sizing, the mindset, and many other things. And I'm coming today telling you that I want to stop trading. So what's going on in this video? I'm going to explain to you why I came to this conclusion, the reasoning behind and what I will do moving forward. So make sure you watch till the end. So let's start from the videos I made, right? Because now you may be wondering, especially for those of you who are, who are new, oh, there is a guy speaking about trading, then suddenly saying that he will not do it anymore. So what about all the content created before? Is it still valid? I think it is. So when I discuss about position sizing, mindset, having a strategy, all of that is still important. The thing is that this is in my opinion, a set of necessary conditions to be successful. But it's not sufficient. In other words, you need to have the right mindset. Yes, you need to have a good strategy. Yes, you need to do the right position sizing, knowing where to put the stop loss, where to take profit. Yes, everything is still valid. But does it mean if you do that you will make the 20, 30, 40% a year that they promise when you attend courses? Hell no. No. This is just necessary for you to survive. And that's actually what happened to me and why I have decided to stop trading. So first of all, I want to share with you the results I got in the last three years. Okay? I'm not here to convince you that I got, like many other people, these 30, 40, 50% a year. I want to be super honest with you because I record all my trades and the result I share with you may sound to you average, okay? But I don't care. I want to be honest what I really got as a result, I don't want to exaggerate to convince anyone to follow me. If after this video you feel that, oh, you just got the result, you are not so good, I stopped following you. Fine. I'm not doing that to gain followers. I'm doing that because I want to be honest and I want to help other people. That may be the same situation. So last three years, what did I get in terms of return with the trading? So before telling you That I want to share that usually I risk around 1%, a little less than 1% for trade. So, meaning if the trade is not successful, I hit stop loss, I may lose around 1% of my capital. Okay? So last year I made 6.62%, considering also commission, everything net. Okay? So by risking 1% for trade, I made 6.62. Two years ago, I made 3.94%. And three years ago, that is basically when I started, I made 8.34%. Okay, so I repeat last year, 6.62 two years ago, 3.94. Three years ago, 8.34. Is it great? Well, depends. If you compare this to leaving your money to your bank account, probably it's not so bad, you know, 6, 4%, 8%. And you may say, look, if instead of risking 1%, you risk 2%, probably you would have made double of that, right? True. That's right. So I'm not saying that the results are bad or really horrible or something that, oh my God, I'm losing money. No, the thing is this. Comparing what I got with the time investment that I have to put to get such result, I don't think is the most successful strategy, okay? Because these numbers, and I will touch on that time commitment later, but these numbers are just good enough for me to justify an investment of time. But what if there are other methods where you invest less time and you can get even better results? Right? Then why should I keep doing that? So let's start from this first point, the results. And I will discuss with you three points. Okay? The first one is the result. So as I said, the result I got that I share with you because I keep track of all my trades. And again, I'm not exaggerating. This is actually what I really got. Right? You can believe me or not, but if I were to lie, I would have said, you know What? I got 30, 40% and it's great, right? And then you will say, oh, yeah, So I also can get the same by following you. But that's exactly the problem. Because when you attend a course, what usually happens is the following. They show you some technique, and then you're under the impression that whenever you are confident enough to implement this technique, then you can get the same results that are shared by those people who are giving testimonials, right? So often you see someone coming and say, hey, look, with this technique, I made 50% last year. Great, right? And you have another guy coming, and then he say, oh, yeah, even made 80%. Wow. So what do you Think when you see something like that, you're like, oh, okay. So they tell me that with this method I can make this, therefore, and this is the trick, therefore I can also expect to make the same. And that's a problem why? Because these testimonials actually they are subject to what is called survivorship bias. That means if you have a pool of say thousand people using the same method and maybe just one of two got exceptionally great results, what they will do, probably they are more willing to share the results to the community because they want to share how good they are and how great the results are. But what about all the rest? Well, if you get average or even negative results, you will not even write a post to share with others, right? So whenever you see something like that, like someone claiming to have made crazy results, you need to ask yourself, what about all the other people who are using the same strategy, right? Because you cannot assume that just because one person made that then you will be able to do the same. Especially when the strategies are quite discretionary. I mean to say, many conditions of the strategy are up to your judgment. They are not really a set of rules that you give the same rules to everyone and everyone will take the same trades, right? Now the other side of the coin is that if you don't get the results, usually the mindset is, oh, I am doing something wrong because these guys are getting these results. So it's possible. So if I don't get them, then it's my fault. But that's again not true. I mean, you may be making some mistakes, but again, to really understand if it's you or the system, you should have a look at the result of everyone using that method, not cherry picking the exceptions and then claiming that these are the expected result for everyone, right? Or consistent results because someone may be lucky for a few months and then maybe we blow up the account, you will never know the second part of the story, right? So again, the results are basically bias, in my opinion. As I said, when you see some testimonial with great results, always remember this is very likely just a cherry picking of someone who got lucky or who is maybe talented, whatever the reason. But it doesn't mean that the system, again it doesn't mean that the system will provide those results for you. So don't be disappointed later when you try to implement that and you don't make 80% a year. So this is the first thing, right? And related to that there is also the risk part, right? Because again, when you are getting something like the Result I share you are taking some risks. So when you are trading, there are a few things that you should consider. And I mentioned that in my videos. For example, the risk of short selling, the risk of your stop loss not being triggered at the level where you set them, or even worse, when the broker does not even execute your stop loss. I made recently a video about that. And you are taking all these risks, all these risks and what you are getting is something decent, but not great. So the question is, for the results I'm getting and the risk I'm putting in, am I really happy? Maybe some people say, oh, but you know, I like trading because of the adrenaline of the excitement of putting the trade and then checking every day is great. I started like that as well. But currently I am moving toward more passive way of dealing with investment. I will discuss that in the last point. So again, to summarize, the first point is about the results. I was very honest with you to share the numbers I got. They are not crazy, they are not great, right? Maybe if I invested in the index, I would have made more money and I would have spent less time. You may say that I did something wrong with the strategy, but I explained to you why. In my opinion, this is a very dangerous way to see things. Because you will always put blame on yourself and you will assume that the results that you have seen are achievable by everyone. Everyone can make 80%. No, it's not true. Let's move to the second point. The second point is a time commitment. So assume that I can make even 20% a year. Maybe I can reach more. I can achieve something like that. Who knows now what is the problem? The problem is I need to spend a lot of time to do that because I tell you my schedule. So every weekend I have some scripts that I wrote to speed up everything. So I collect a set of stocks that are good from the fundamental point of view and. And then when I have my watch list, I will put it on my platform and then I run additional technical screener later. So every weekend I have to find out a short list of stocks that then I will use the next week when I look for setups. This now doesn't take much, maybe 10, 15 minutes. But just because I spend time creating some code that is doing many operations automatically. If I didn't have that knowledge and I have to do it manually, it will take probably one, two hours every weekend. But that's not all, because every morning I live in Singapore, so I can do this in the morning because the stock market opens evening right here, the US Stock market. So every morning I need to run my technical screener. I need to look for setups. I need to look for many other things like, okay, is the risk reward, fine, all that. And I try to automate as much as possible, but still I need to spend one, one and a half hour every day. So again, Monday to Friday, you need to spend one to one and a half hour weekend, 10, 15 minutes. That's a big time commitment. Many people may not have this time. Or maybe, as in my case, I think that I can use my time better because I'm not getting results that justify this time commitment. And this brings me to the third point, because you say, okay, what is the alternative? The alternative is using methodologies that are, number one, less discretionary, so they are more robust in a way, because it's not something where the results really depend on more on the individual than on the system itself. For example, I'm running now a portfolio where you put your stocks, etf, whatever it is, and then you leave it there and then you rebalance. Every year I made a video about rebalancing. If you don't know what it is. But again, the idea is that, okay, this is something where you are more confident. You give this strategy to 100 people will get more or less the same results without many variations. The difference may be, oh, you place the order maybe today or tomorrow, but in the long term it won't make a big difference. But what to buy and how much to buy is fixed. It's not up to the judgment of the person who may say, oh, yeah, but I think this setup looks good, so I take the trade. Or I think it doesn't look good. Because when it's something like I think I don't think is my judgment, then it's subjective. Subjective means you cannot really assess if the results are good because of the system or because your judgment. You know that I'm investing in real estate investment trucks, for example. This is a more passive way of investing and I prefer it. Why? Because on top of getting dividends, you need to spend less time. So you have the portfolio that I just mentioned that I may create some content about that in the future. But let's say is a methodology where you buy something at fixed percentage and then you just rebalance every year or every six months. You have real estate investment trust, you can buy index, you know, if you just buy the S&P 500, the Spy ETF, or maybe you buy regularly every month. What is Called the DCA dollar cost averaging method is much easier. You don't spend much time, you know that every month you just need to place a trade, that's all. No need to think about all the setup is good is not good. And the narrative that doing that means you're less profitable than doing trading in my experience with my three plus years of data, is not true. Another method that will take less time is to do the investing based more on the fundamental analysis. So you do your search of a set of very, very strong companies, right? You have your watch list and whenever the price is good enough, you accumulate. For example, what happened recently with Amazon, there was a big drop of 7 something percent. So I bought some shares, right? This is also something that is even potentially more profitable than doing active trading and it requires less time. But I was trying many things, you know, before I was even trying some scalping. And you know, it means you are in and out very, very quickly. But the risks are much higher because you need to use a lot of margin. I mentioned the problem that stop loss may not even be triggered is very risky. And again I don't see a level of returns that justify that level of risk, that level of time commitment. So to summarize, I will stop for now doing trading. I will focus on other strategies that are less time consuming, that are less discretionary and for which the potential profits are even larger. So to summarize, these are the reasons why I will stop for now doing trading. The results that are not super exciting, the time commitment that is too much and the existence of alternative methods that I will be focusing on that are more investing in the long term dollar cost, averaging on indices, REITs and at the same time portfolios where you just need to rebalance every six months or every year. This doesn't mean that I'm against trading. If you are fine with trading, you got good results, go on, it's fine. The videos I make still applies the importance of mindset, the importance of having a system and position sizing and all this. But I wanted to share this with you because if you're not getting the results you told or you were promised, don't think it's because of you, don't think it's your fault. It may be for the reasons I described. So maybe you can honestly reflect as I did after a few years, realize if the system you are using is worth or not. And if not change it and move to something that is a better option. With that, I really thank you for watching and see you next time.