In this instructional video, the presenter argues that most new day traders over‑complicate their start by piling on indicators and jumping between strategies without a solid foundation. He proposes a step‑by‑step approach that begins with a written business plan, followed by quantitative budgeting using a cost‑of‑living and account‑size spreadsheet to determine daily point targets and required contract sizes. Using the Euro Stoxx as an example, he shows how to calculate the number of points needed per day, how losing streaks affect those targets, and why trading only one contract can be a prudent risk‑management choice. The core of the method is disciplined risk per trade—typically 0.3%–0.5% of the account—contrasted with the common but dangerous 1%–2% risk levels. He explains how to model losing streaks, the impact on drawdown, and why a maximum 20% drawdown rule should be baked into the plan. The video stresses the necessity of robust strategy statistics (200‑400 trades) to know win rate, average risk‑reward, and longest losing streaks before risking real money. Finally, he advises testing the strategy across market phases (sideways, bull, bear) to ensure robustness, and only after the plan, review, and control steps are solid should a trader move to live execution. The overall message is that a simple, mathematically sound plan, rather than complex indicator overload, is the easiest and most sustainable way to start day trading.
Chapters
Most people make day trading way too complicated right from the start. They stack all these wild indicators on top of each other, jump from one strategy to the next, and then they're totally overloaded and have no idea when, how, where, or what. And that's exactly what's not necessary, because getting started can be much easier than you think. Yeah, if I were to start day trading all over again today, what would be the very first thing I'd do? And I really want to emphasize this to you, I would create a business plan. Because in day trading especially, so many people just jump in and start playing around. They look at a strategy and think they can just copy that strategy. It seems so simple, and then they start implementing it, and let's be honest, that's usually when the trouble starts. The moment you start implementing, the truth comes to light, and suddenly things don't go as smoothly as you imagined. It's not always about the strategy. It's very often about you yourself. It's because you're under pressure, you're stressed, you're stressing yourself out, and you don't really know how the whole thing is supposed to work. It's a bit like being in driving school. Look, you take theory lessons there, and there's a reason you have a driving instructor afterwards to introduce you to what you've learned and show you how to apply those theory lessons on the road. And then you might have different weather conditions to deal with. And it's the same way on the stock markets. You have very different market phases, different volatilities, and ranges of fluctuation where certainly not all strategies will work the same way every time. That's just not possible. And to capture exactly that correctly, I want to show you in this video how I would do it today. And I believe that this will be incredibly helpful for you, and I also think it will be incredibly helpful for many traders who have been around for a while. And so, I'd love to take you along with me now. Because what I'm about to show you is what will lead to you being able to establish your trading business for the long term. I have this wonderful cost-of-living calculator here. Don't worry, we're going to do a bit more than that today. But look, very few people really visualize for themselves: How expensive is my life, actually? How much time and how much money can I even afford to spend to get any value at all at the end of the month? And for that, I have this wonderful spreadsheet here where you can enter your account size. How many days can you actually trade? What's the average value of the contracts that I'm trading? And then I can determine something really great for myself over here on the right. I'd like to go through that in more detail with you. If I have 18 trading days, for example, then that means how many points per day do I have to earn on the underlying asset if I'm proactively entering my trades with a corresponding account? And then you can see right away here on the right side wealth accumulation. Ah, from this point on we have a positive number. That means I need to average 12 points a day if I calculate for myself based on this contract size and a tax rate which I've just entered here as 28%, though it might be more for some and less for others. Now you might say, oh, 12 points a day—that's absolutely nothing. And I want to show you something in a moment so you get an idea that 12 points a day isn't actually that little if you do your job really cleanly. Now the question is, of course, well, why only 1 contract? That has to do with risk management. It also has to do with money management, how you set everything up. Because that's also something that many people look at completely the wrong way. And so, let's go through the whole thing step by step. A typical market that reflects the contract size we just predefined here, for example, is the Euro Stoxx. And the Euro Stoxx is a market that many consider boring. But let's look again. We need 12 points a day, and 12 points in the Euro Stoxx would be a distance just this big, from 80 to 92. That means if you locate this one trade here really smartly for yourself every day, you'd be at breakeven But the thing is, it's not actually that easy. Because what does it look like when you have days where you might have booked a trade in the wrong direction here, for example? Yeah. You wanted to go short here, and the market goes up. And suddenly you're down 10 points. And then you do it all over again and set your stop tighter. Many of you probably know this. And you're down another 5 points. Suddenly you're already at -15 points. And now you feel bad and say, everything sucks, I'm quitting for today. Well, what does that mean mathematically? Mathematically, it already means that if you build your business over 18 days, you can't calculate with 12 points a day anymore. Instead, you now have to average 15 points because you have negative days in there. Such simple math, but unfortunately, many people don't visualize it at all, because they just start. They just start and haven't set up these most basic building blocks. Therefore, the very first thing is very, very important: When do I start a trade, with what position size, so that it never harms my account in the long run? And for that, you also have to understand the math a little better. I told you, I made an incredible number of mistakes at the beginning, and that was actually one of the biggest. Because I didn't ask myself these questions. Some people say, I risk 1% on every trade. Others say, I have a great strategy, I risk 2% on every trade. Now, the truth is that many big traders, for example, only risk 0.3% per trade. Well, why is that? These are metrics that are already absurd to many, and let's look together at why this is so important. Before we get back into it, a quick notice: World Class Edge just launched, and if you want to know how really institutional traders and market makers actually trade, click the link below and secure your spot at World Class Edge. All right, back to it. Look, back then, I, um, was told to always risk 2% per trade for my Super Breakout strategy. And that means, in all seriousness, I took a 2% risk per trade back then. But I had no idea at all how long the losing streaks could actually be. And if you don't know your losing streaks, you can use very simple processes to determine that mathematically. And let's assume I had lost 18 trades in a row and I hadn't started gambling, then at 1% risk, that would be -18% on my account. Mathematically, that's just about the absolute limit. At 2% risk, that was already a 36% loss, and at 3% risk per trade, and believe me, there are people who do that, already a 54% loss. So it's totally important that you first know all the metrics. But what if you don't know them? Then expect very, very, very, very bad numbers. Why is that? I'll show you now. Look, to illustrate this very simply, if you take a 2% risk per trade and you have 15 trades that go wrong, and believe me, that happens, then you're already at -30% on your account. And now comes the crucial part. If you adjust your position size according to your account size, which you balance as a percentage per trade, that means 30% fewer units. That means if you were working with €100,000, for example, and per trade if you risk 2%, which is of course complete madness, you risk €2,000 per trade. You are only allowed to use €1,400 per trade in risk once the whole thing has gone down by 30%. What does that mean? It essentially means that you are already forced to generate a 42% return just to break even, simply because you are entering the market with a much smaller size per trade. And so, quite frankly, you already have a very real and significant problem, mathematically speaking, which is going to be incredibly difficult to overcome. That's why we always say, set everything up for a maximum 20% drawdown if everything goes wrong, no matter how many consecutive losses occur or how much of a safety buffer you build in, so that you're even able to maintain a solid mathematical advantage. That means before you start trading, it's essential that you first know exactly what your win rate actually is. For that, you need at least 200, 300, or 400 trades. Then, how long were the absolute losing streaks in a row? 10, 13, 17 trades in a row, then maybe a brief move up, and then more losing streaks. Those are real losing streaks. And once you know that, you have to calculate: What is my average risk-reward ratio for my trades? Because many people cut that short, they take profits too early, and then you get a result. And that result is, what is my absolute maximum drawdown? And then, please, be sure to remember this slide right here. And only then do you move forward and start, perhaps, working with real money. To summarize, if you simply don't know your strategy's statistics, you can't know what risk per trade you're allowed to take. And because of that, you must know exactly what position size my strategy can actually handle. Otherwise, it's just a never-ending story. Therefore, you must always base your entire business on the 20% rule. And if you base the whole business on this 20% drawdown rule, you'll know for sure that you'll be mathematically able to make money at all, provided you have a positive expected value. And I know many people won't like this video because it all seems so simple and mathematical. No, it's actually not. Most people end up losing simply because of this deceptive simplicity, failing to stop and ask themselves, is what I am actually doing here even realistic? They consistently fail to check if what they are planning is truly mathematically sound or if it can even work that way in the real world. And let's go back to driving school. If you didn't understand the theory in driving school, how are you supposed to start driving here? And what happens if markets suddenly start experiencing increased volatility? Does your strategy even work in this market phase? Have you tested your strategy for robustness? That means, does it work in sideways markets? Does it work in bull markets? Does it work in bear markets? Or do you have different concepts for different market phases? Because that's often where the problem lies. When I started back then and Lehman Brothers happened, suddenly everything And many people aren't aware of that. And they don't have a mathematical master plan from the start because that's no fun. They just want to jump right in and get going. And if you do that, believe me, you'll have years ahead of you where you have to catch up, which is very hard and takes a lot of emotional strength to get to the point of learning this wonderful profession of trading. So take what I've shown you here as a message and build your business plan. And then you'll realize that you're building your trading business very smartly. And only then do you move on to strategic implementation, reviewing, and controlling. And when that's working, then you can start entering the markets with real money. Thank you very much for your time.
