With so many stocks to choose from, how ever do you decide which to trade and exactly what is the right number? After all, there are popular stocks, penny stocks, dividend plays, ETFs and safety stocks just to name a few. It can get very overwhelming!
So many investors/traders talk about their “10 positions,” “20 positions,” “50 positions,” or even “100 positions.” They also talk about how frustrated they are with all of those positions.
Think about it! Mutual funds have hundreds of positions, and their goal is to be diversified.
If the market goes up, then they could make 2-3%.
If the market goes up big, then they can make 5-6%.
If the market goes down, then the funds will be down 2-3%.
If the market goes down big, then the funds will be down 5-6%.
If they break even, then you will have just paid thousands of dollars to have your money do nothing.
Mutual funds are like teams that play to “never lose”, rather than to win; yes, they may win games, but will never win the championships.
Does that mean you should avoid mutual funds? No, not at all. I invest in mutual funds, 529 plans and my 401k.
But I also have my own personal account. The one I trade in…and that beats all of them.
With a little risk capital, you can learn to focus on individual stocks and, you might just make in a single trade – what a mutual fund makes in a good year.
That’s right, when you learn to trade for yourself, it’s possible to make 5-6% or more on one single trade.
If anything, I am probably underestimating it.
I went on Fox Business multiple times and was asked to identify stocks that I liked. Each time, they went up over 20%…and one went up 50% in under two months!
The key to it all…
A Strong Focus On Individual Stocks.
By channeling 2-3 stocks well you can trade in your own world where you rely on individual performance which can easily outperform the market as a whole.
The more stocks you trade, the more you are playing the market as a whole. The less stocks you play, the more control you have.
I watched a savvy student start with $5,000 and turn it into $65,000 in months by trading stocks in one sector. Sometimes, less really is more.
If I had to own 100 stocks for ten years – I would just as soon have someone else manage my money. At least then I could have someone to yell at!
But I don’t have to own 100 stocks; so I choose to rely on myself.
Now you can learn to rely on yourself.
This is the system that will allow you to profit if the market continues higher and teaches you how to protect yourself during pullbacks.
P.S. This book is the first thing I handed to every one of my traders who walked through the door.
Adam Mesh is CEO and Founder of The Adam Mesh Trading Group. For the past 18 years he has coached thousands of students to all levels of success in trading. He is also creator of the revolutionary Full Contact Trading