Trading Lessons I Learned the Hard Way, Part 3

08/03/2012 8:00 am EST


Ron Wagner

Principal Partner,

Ron Wagner of Revolutionary Trading discusses the lessons he learned from his early days of trading, and how his trading has evolved to become profitable.

Find the previous article here. Start at the beginning here.

After only about six months of applying ourselves to this one form of trading, we were starting to have some nice success swing trading using technical analysis.

Then I had a remarkable chance to take a six-month break from most of my other responsibilities. We now had enough money to pay the bills for a while, and an opportunity came up for me to trade on the floor of what was once the most well-known trading educational firm around. This was before online education was available as we know it today. Most of the trading education at this time was only done at physical locations or hotel-type seminars.

So, I packed up my SUV, kissed Angel goodbye, and left her and the boys for nearly six months to see if I could perfect my trading even more. Keep in mind, I embarked on this quest to actually improve my swing trading to a higher level, learn more about advanced options trading, and learn how to select a larger number of trading candidates to trade.

I hate to admit it, but I was sold a bill of goods about a program that was not structured as I had anticipated. Two of the instructors whom I had anticipated learning from left this company just before I arrived, and I was not told before my 2,000-mile trip. Angel and I had several very complicated conversations during this time, as I had to either construct my own program and make the best of a very bad situation or go home.

Well, because of my experience in working on structuring programs during my professional career, I offered to help write material for students participating in the same program I had enrolled in. I was tested under fire, and although it was a very difficult task to try and perfect my trading while at the same time writing material that everyone needed, it was one of the best things that happened for my trading career.

I was already a very successful swing trader, and my goal was to become even better. But all of the floor traders and only one or two instructors remaining at this company were, in fact, daytraders. This is how I accidentally fell in love with daytrading. Months later, Angel said, “What happened? You are a daytrader?”

 And I said with a big smile, "Yes, isn’t that great!"

During my initial stages of switching gears to hone my skills as a new daytrader, I was a trading machine. Some days I traded 70,000 or 80,000 shares with my own capital (at those times we could only get 2:1 leverage). Back then, commission rates were much higher than they are today.

The first thing I had to do was to get out a bunch of lined writing tablets. I began to construct a timeline. I had to detail out a step-by-step process for myself and others who were relying on an organized structured program to learn all this.

It was extremely hard to get anyone to help in this process, as most were less experienced than I was in trading. The couple of instructors on the trading floor were always either too interested in their own trading, or taking care of other business. I did enlist them to do some scheduled training sessions, but they were mostly not organized or unstructured, although helpful.

The first item of importance was to make a universe. This was, in fact, one of the most important reasons I chose to take this program. Fortunately, one of the remaining instructors became a close friend, and he was very helpful in showing me some of the finer points of scanning. Unfortunately, he used TC2000, and had his favorite scans already programmed and doing what he needed.

So, remarkably, I learned what he was doing and took the scanning process to an even higher level of proficiency by doing it manually. Sure, it took longer, but what I could find was more than any mechanical system produced.

Lessons learned:

  1. Make sure you check out who you decide to work with better than I did.

  2. Start preparing a timeline with the essential elements that you need to become proficient in for your style of trading.

  3. Be specific in what you need to accomplish, and how long you estimate each task will take to complete.

  4. Treat it like a semester or two of college. Each element represents one specific area of need. As with any curriculum, make sure the process is lined out methodically, so you are learning things in the right order. This way, you can then go to the next element with confidence.

  5. Make a universe that is conducive to your style of trading so you become familiar and comfortable with trading your choices.

Next, I will identify the next steps I took to become a very consistent daytrader!

Ron Wagner can be found at Revolutionary Trading.

Part 4

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