Why Putting a “P” on the Page Is the Most Valuable Trading Lesson

Want to know the secret to successful trading? [Jeff Clark's Market Minute]( Managing Editor’s Note: Today, we’re handing the reins to colleague Larry Benedict – a market wizard and legendary hedge fund manager. He’ll explain his secret to successful trading is securing multiple “tiny” wins… rather than trying to catch huge moves. Here’s Larry… --------------------------------------------------------------- Why Putting a “P” on the Page Is the Most Valuable Trading Lesson By Larry Benedict, editor, Trading With Larry Benedict Want to know the secret to successful trading? Unlike what you may think, it’s not about being a hot shot and taking high-risk bets. I’ve seen enough traders blow themselves up to know that’s a losing strategy. I’ve known traders with that mindset who ended up losing their homes… or even worse. They had a gambler’s mentality. And it caught up with them in the end. The secret to making money over time is to treat it not like an outing to a casino but as a business. Apply this insight to your trading, and you stand to really move the needle on your wealth. Fail to apply it, and you’ll likely end up losing money. In fact, I can’t stress enough how important it is to internalize. As you’ll see today, it’s what allowed me to thrive as a trader for the past four decades. If you’ve been reading along for some time, you may already know my story. But for newer readers, a quick introduction… Recommended Link [AI + Advance Alerts = The New American Dream]( [image]( Meet Andy and Landon Swan, a couple of Midwestern brothers who transformed themselves into legendary Wall Street fintech experts. Fortune 500 companies and $100 billion hedge funds pay up to $750,000 a year to access their stock market research. Now they’ve issued a major buy alert for a surprising company making news in the AI space. They have compelling evidence that this [sub-$5 stock]( could become the #1 tech sensation of the decade! [Find Out More Before the Price Goes Ballistic]( -- All the “No-Nos” My career as a trader began in 1984. I started out on the floor of the Chicago Board Options Exchange (CBOE) with $10,000 of my own money. That’s me on the right. Larry (right) on the floor of the CBOE But I really learned the ropes as a trader at a firm called Spear, Leeds & Kellogg. At the time, it was the largest specialist trading firm in the world – meaning it traded its own money. It traded almost every stock on the New York Stock Exchange. Then from 2000 until 2013, I ran my own hedge fund. It wasn’t all smooth sailing. Far from it… Early in my career, I bet too much on risky trades and got wiped out. I chewed through all my money two or three times by making silly mistakes. I was too impulsive. I was going for home runs. I was holding onto my losers for too long. All the “no-nos” of trading. Then something changed. I’d lost so much money, I thought my trading career was over. At the same time, I had a buddy, Andy, who was making money every day. I couldn’t figure out why… I remember I called my mom and complained to her that Andy was making so much money and I was losing all of mine. I was desperate for an answer. She said, “Just do what he’s doing.” It was a light-bulb moment. You see, what Andy was doing was simple. Instead of going all in on a risky trade idea like me, he was taking smaller wins on lower-risk trades. That way, he was slowly but surely building a strong base of capital. Putting a “P” on the Page That’s what businesses do all the time. Coca-Cola, Nike, Hershey’s – these blue-chip companies haven’t been around for decades because they take wild bets all the time. They’re in business for decades because they’re booking smaller profits day in, day out. It took me a long time to grasp this concept. But when I did, it transformed my trading. From 1990 to 2010, I didn’t have a single losing year as a trader. This winning streak was so unusual, it got me featured in the 2012 book on the world’s greatest hedge fund managers, Hedge Fund Market Wizards. (I was featured in the chapter after Ray Dalio, the manager of the world’s largest hedge fund.) It all came down to the insight I learned from Andy. I call it putting a “P” (for profit) on the page. You don’t take on much risk until you’ve had a string of smaller winners. You build a pile of capital you can speculate with. If you don’t have a big enough base of capital, you shouldn’t take on any high-risk trades. Target 5%… 10%… or 25% returns. Grab these smaller wins when you can. As the old-timers say, you never go broke taking a profit. Once you’ve built a strong foundation of capital, you’ve earned the ability to take on more risk. I’m not saying there’s no room for more speculative trades. But you have to earn them. Free Trading Resources Have you checked out Jeff's free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just [click here]( to check it out. You need to grow your capital pile with low-risk trades before you shoot for the moon. That way, you’re protected if the risky trade goes bust. That’s what keeps you in the green. Unfortunately, what tends to happen is the opposite. You go on a losing streak… get frustrated and emotional… and lose even more, even faster, because you’re shooting for big wins to recapture those losses. I’ve seen it happen dozens of times throughout my career. It’s one of the key factors that wipes out new traders. Instead, you want to think like a business. You earn the ability to take on more risk only after you’ve put a “P” on the page. That way, you can go the distance as a trader and build your wealth, slowly over time. Happy Trading! Larry Benedict Editor, Trading With Larry Benedict [Jeff Clark's Market Minute]( Jeff Clark Trader 55 NE 5th Avenue, Delray Beach, FL 33483 [www.jeffclarktrader.com]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Jeff Clark Trader welcomes your feedback and questions. But please note: The law prohibits us from giving personalized advice. To contact Customer Service, call toll free Domestic/International: 1-800-752-0820, Mon–Fri, 9am–7pm ET, or email us [here](mailto:contactus@jeffclarktrader.com). © 2024 Omnia Research, LLC. All rights reserved. Any reproduction, copying, or redistribution of our content, in whole or in part, is prohibited without written permission from Omnia Research, LLC. [Privacy Policy]( | [Terms of Use](