Stop Doing "The Trader Shuffle"

Hi, Brian McAvoy of Inside Out Trading here. Today we're going to talk about, you know, how to stop doing the trade or shuffle. You know, where you take two steps forward, two steps back, slide at the side. Before we get started, make sure that you subscribe to this channel, and if you're on YouTube, make sure that you go ahead and click the notification bell. Well, yeah, you know, I talk to a lot of traders. I've been, I've been helping traders for over 14 years now. And the Trader Shuffle, that's what I've come to, you know, call. You know, the shuffle that everybody does where you, you try something and it doesn't work. You slide over here and you try this and it doesn't work. And you're basically doing a whole lot of dancing, but at the end of a year or two or five, you're still standing in the same spot you were when the music started. So anyway, one of the first things you really need to do to stop doing the Trader Shuffle, and this is really important for the psychology of things, keeping yourself under control, giving yourself focus. Well, here's what I'm talking about. I was talking with this trader the other day, and we're talking about what he wants to accomplish with his trading. Wants to be able to eventually quit his job so he can spend time with. He's got a young daughter and he wants to be able to go pick her up from the bus stop. And he wants to trade a few hours a day. He enjoys it. But just to pursue his personal interest, he wants to stop putting in nine to ten hours a day working for somebody else. And so he wants the financial freedom. And I'm like, okay, well, so do you know how much you want to make? And he's like, well, huh, I hadn't really even thought about it. And he hadn't been trading for a couple of years. And he said, well, you know, how much do you need to replace your income? You know, and, you know, the financial freedom, you know, what's, what's the minimum you need to make and, you know, where do you want to be? And he said, well, you know, I really need about five grand a month to support my family and really to be where I want to be, I need to be making about ten grand a month. You know, cover taxes and contingencies and all the other stuff. I'm like, okay, so what kind of an, you know, an account size are you working with? And he told me, and I'm like, okay, so you need to be making, you Know this kind of a, you know, a return on your investment. He's like, wow, I don't know, is that even reasonable? And so we got to talking about it. And the thing is, so many traders, so many people that I talk to, you know, it's like, what do you want to do with your trade? I want to make a lot of money. We want to ask them, you know, to be a little more specific. They really don't know. I mean, a lot of times they don't even know how much, you know, they want to make. Really. They just want to make minimum, some money and how much, you know, is reasonable for their system. You know, the way they're trading and their account size and everything. A lot of times they don't even know if you know what's realistic to expect with what they're working with. And I'm not faulting anybody. When I first started trading, I did the same thing. I was just jumping into it. It's like, hey, yeah, easy way to make some money. But if you're going to be serious about it, and the main thing is if you want to have some focus so that every time you hear about some newfangled system or whatever, or any, all the noise that's out there, if you don't have some of your own stuff, clear what you're working with, what you're trying to accomplish specifically, you don't have that focus around which to build structure. All this other stuff is just mental distraction, sucking up your mental energy and messing with you and you're trading. But when you have the clarity and you can give yourself the structure because now you know what you're clearly pursuing, it also gives you the basis to evaluate what you're working with and is it reasonable? Here's what I'm talking about. I'm going to show you this tool that I made. It's really cool. Yeah, this is. It's called the Trading Plan Financial what if Scenario Analyzer. So you can take a look, you know, different, different scenarios and see, you know, how the numbers play out. I mean, you know, this is business, this is investing, it's numbers. So whatever you want to do, the numbers have to work. So, and I made this spreadsheet. It's free. And I'll put a download link in the description down below so you can download it for free. But let me just zoom down here. So, okay, what we're looking at here, like I said, let's so to see if your numbers are reasonable. Okay, so let's say you're starting with an account balance of $25,000, and you want to make 10%, $2,500 a month, you know, is that reasonable? Okay, well, if you're risking 2%, you know, per trade, which is reasonable, that gives you a position size of $500. Okay, so that's what you're risking on every trade is $500. Well, let's say, you know, if you have a 50% win rate, not super aggressive, and a profit to loss ratio of 1.5, again, not super aggressive or unreasonable, well, that's going to give you an expectancy or an average return per trade of 125 bucks. Okay, well, if you want to make, you know, $2,500 a month, well, if you place 20 trades and the average return is 125 bucks, there's your $2,500. That's like, you know, five trades a week, one trade a day. And the other thing, everybody's almost worried about the net profit or the dollars on every trade, but a lot of times people forget the frequency. How many times are you doing that every month? If you're making one 25 bucks a trade, but you can only do it three times a month, well, you're not going to make a whole lot of money. But if you've got a system that provides you the opportunities and you're placing, like I said, just one trade a day at 125 bucks, well, heck, there's your 10%. And so as far as what he was talking about, yeah, it's perfectly reasonable to make a 10% return on your investment. And we're talking about, again, a system where it's 2% risk limit on each trade, win rate of 50% and a profit to loss ratio of 1.5. These are not super aggressive numbers. So the key to it though, and this is where so many people lose focus and get frustrated all at the same time, is they'll buy into some clever strategy but not have a good system. And so the system doesn't work very well and they don't get these numbers, they don't get the win rate or they don't get the profit to loss ratio, and so they don't get the return. And then they're thinking, you know, they're thinking, well, this is a crappy system. And it is, it's a crappy system. It's cute sounding strategy. Very clever sounding strategy. But the thing is, like I said, it's a numbers game. And so anything that you're looking at, whatever the system is, whatever the strategy is the system has to work. It has to be repeatable over hundreds of trades and deliver the kind of numbers that you're looking for. Otherwise, it's just a clever signing strategy. If you can't do it over and over and over and over again, well, then it's kind of worthless. If you have a good system and the repeatability is there, well, cool. Yeah, then you can actually make really good money as a trader. 10% monthly ROI, not unreasonable, not super aggressive. And so, yeah, it's not unreasonable to expect and to look forward to in your trading. So really, I mean, the whole point is if you don't want to be doing the trader shuffle, where you're just chasing stuff here and there and jumping from system to system to system, the first thing to do is get clear about what you're trying to accomplish and know that what you're looking at is reasonable. And then that gives you your focus. It also gives you a way to evaluate anything that you're looking at. Is it going to be sufficient for accomplishing my goals? Does this deliver the right return on this account size for me to accomplish my goals? And if not, okay, what do I need to do? But like I said, if you want to stop doing the trader shuffle, first thing is get clear on where you're at and what you're trying to accomplish and have a tool so that you can run the numbers on it. Again. Down in the description below is the link where you can access the what if analyzer and go ahead and play with it. It's a pretty cool tool. I made it. So yeah, you can take a look at this kind of stuff and see what's reasonable, what's realistic, what's not realistic. Now, if you need help with your trading, you'd like some help getting things sorted out. What's really keeping you from being where you want to be with your trading, what you need to do to get there, that kind of stuff. Well, swing by my site, Insideouttrading.com now if you enjoyed this video, like it, you know, give me a thumbs up down below. Comment, subscribe to the channel and of course share it with your friends. Cheers.