With another week under our belt in 2014, this one may well go down as one of our best. On last Monday's Live Trading Class with our Premium Members, we designed 11 trades, 8 of which expired today as they were Weekly Trades. Of these 8, we had 5 winners and 3 losers. Now, at first glance, many would say that is a decent week. But when you look a little deeper at the numbers, you walk away with a whole new appreciation.
So what are the numbers? Well, using ou new asset allocation model, where we allocate different amounts into each trade depending on many factors, including probability, risk/reward, type of trade and our personal sentiment, we ended up turning a 5-3 week into big profits. At the start of the year, we began with a $100,000 mock portfolio. As of today, that portfolio is worth $159,422 (and this is net after all fees and commissions). That means we are up 59% in approximately 2 months.
We are very proud of these results, but they could be much better, and will get much better. We are always studying our winners and losers, learning from them, adapted and moving forward. Next week should be another great one. I hope to see you all there!
As I sit here reading the latest headlines, I just have to shake my head and wonder how it is we got ourselves back to this place again. Years back, the Real Estate Market was booming. It was a No Lose Investment... and EVERYONE was jumping onboard. And then the inevitable happened, it collapsed. While we could sit here and dissect why this happened, how it could have been prevented, etc., I feel it is more important to ask ourselves "how can we avoid this happening to us in the future". Well, the answer is actually quite simple.
Don't Be Greedy!
The top 3 items in the news today are Bitcoin, Marijuana and WhatsApp. What do these all have in common? Really? They are ALL way overpriced and overhyped, are they not? Now, some of you are immediately going into defense mode right about now. You are coming up with excuse after excuse as to why these are all great investments, and how they are all worth the money. But are they?
Anytime you have the potential to make the kind of return we could from such investments as Bitcoin, you have to understand there is tremendous risk. People are learning that today as one of the largest Bitcoin Brokers just shut their doors and took their client's money. Bitcoin's rate plummeted 30% in value. So, was it worth it? Was it a great investment?
Whenever I talk to the average person about investments, inevitably one of these topics will come up. No one would be happy with making 39% YTD as we have at ETNtrade trading companies like Home Depot, Macys, Target, etc. No, they all want the next great home run. Well, Home Run Hitters don't always hit home runs do they? They strike out quite a few times. They also pop out all the time. The same applies here. Why always look for the next "big hype" when we can trade conservatively, trade solid, proven companies, and at the same time get results that would rival the promised return from many of these high flyers.
Everyone take a deep breath as settle down. Don't get caught up in the hype. I promise that for every one Google, there are 99+ companies you never heard of because they went to 0. Don't be the person kicking yourself 5 years from now wondering why you invested in yet another overhyped, overvalued investment. Be smart, be conservative, make money! If you don't know how, let us help... Just ask!
To start off the New Year with the right foot forward, ETNtrade has added many new features to our Membership to continue our goal of being the #1 Option Trader Resource. One of those features is our brand new Mock Portfolio. We have put together a spreadsheet that will track all of our trades we demonstrated in our Live Trading Classes throughout the year. It tracks live entry pricing, live exit pricing, commissions, and any other cost associated with trading. In short, it is as authentic as one could get as to what a portfolio would look like if doing all of the trades we discuss at ETNtrade. Even though the purpose of our Live Trading Sessions is strictly education, I feel it is important to track the results as well to ensure that what we are teaching actually works in real life. Who else out there does that? I can't think of anyone either...
To set things up, we started off with a $100,000 portfolio. For some, that may be a little more than you would start with. For others, it is less. I chose that number so that I could take ALL of the trades that we take in our classes. That means there may be times that I am in 25-30 trades at one time. I need the capital to be able to accomplish that.
Another new feature is that we are now ranking our trades with Asset Allocation "Units". One unit can be defined as a predetermined amount of money that we will put into each trade. So, on a 1-10 scale, we can account for those trades we would put less into, and those we would put more into. For our tracking purposes, 1 unit will equal 1% of the portfolio, and therefore 10 units would be 10%. So, at no time will we have more than 10% of our portfolio at risk in any one trade. Others may want to use a different ratio, but this works very nicely for us in this mock case.
So how are we doing so far in 2014? Well, with a starting base of $100,000 on January 6, I am proud to announce that as of expiration today, January 24th, we have a Mock Portfolio worth $125,113.48. While we cannot expect this type of return every 2-3 weeks in the Market, it sure does say quite a bit about whether the techniques we teach at ETNtrade actually work. I can say, not only with words but also with numbers, that indeed, THEY WORK! We consistently have proven this over the last 4+ years, and will continue to do so moving forward.
I also would like to point out that these numbers are ABSOLUTELY NOT back-tested trades. Many people show off great trade results, but if you look at the fine print at the bottom of the page, you find they were back testing. Well sure, that is no surprise they made money, now is it? Anyone can be successful if looking back on the Market to place past trades. Heck, I would just bet that the Broncos will face the Seahawks in the Super Bowl instead. I mean, statistics would have suggested it a month ago, so why not "back-test" a bet on it? See how silly that sounds? That is not real trading. Real Traders have to trade in Real Time. So, all of our trades in our Mock Portfolio are not only delivered in a Member-Only Live Trading format, but they are also tracked on our Member-Only Discussion Board as well, both entry and exits and they are done LIVE in the Market. Real Trades, Real Time and more importantly... Real Results!
And we are just getting started. I am excited for Monday, when we get to explore a whole new set of trades and continue to grow our Mock Portfolio to all new highs. Will you be joining us? For more details on how, email us by the start of the Training on January 28th, as that will be the final day of Open Enrollment: Support@ETNtrade.com. We would love to have you all onboard!
Also, if you would like to see the spreadsheet with all of our trade results, I would be glad to share it with you. Just email me and let me know: Dave@ETNtrade.com.
We will see all of our Current Members on Monday and all of our New Members on Tuesday!