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3Cs of trading - Must readI call it the 3 Cs of trading Trading the financial markets can be a challenging and rewarding endeavor. One of the keys to success in trading is making informed... Choices - Choose the markets you want to trade, the strategy, the time frame, choose your mentor and choose your times and plans... Next you need to take calculated: Chances - Take a chance to execute, to deposit money in your account, to set up your trades and lineups. And then be willing to adapt and make. Changes - Changes to your strategy, journal, system and whatever you need to evolve with the current market conditions and environments. Did you find this helpful? I'd love to hear your feedback Trade well, live free. Timon MATI Trader
JSE:J200Education
by Timonrosso
How To Handle And Minimise Your Losses in A DrawdownI want to cover different ways to handle yourself during a drawdown to minimise your losses. Minimise Drawdown Part #1: Lower your risk per trade There are times when the market will be in a bad market environment… This is when no matter whether you buy or sell, you end up just taking a whole bunch of losses. The first trick is to pinpoint when the market is in a bad environment. For me as a breakout trader, I wait for the main index to move in a sideways trend. This way, I know I have a medium to low probability of the trades to work out. If you can find out when the market is in a bad environment, then you’ll know when to lower your risk. In my case, I drop the risk from 2% per trade – down to 1.5%. If my portfolio continues to drop, I will lower the risk further to 1% per trade until the market rectifies itself. This is the first way to minimize your losses. Minimise Drawdown Part #2: Lower the number of trades you take You’ll know when the markets are looking S#@t all around. This is because the large stock markets tend to lead the emerging markets. And when this happens, the second best thing you can do is limit the trades you take. If you find you’re averaging around five to nine open trades at a time, it might be time to start cutting down. Because what if all nine trades end up to be losers, due to the bad market environment? Well you’ll find yourself down around 18% of your portfolio. So instead, limit the number of trades you’ll hold during the drawdown phase. Maybe it will four to five instead… Just remember that being neutral and holding cash is ALSO a trading position. Minimise Drawdown Part #3: Hedge your positions This doesn’t always work, but it has saved my ass a couple of times. When I find I’m long (bought) five stocks. And I see that the market has completely changed direction to the downside. I know that there is a higher chance that I’m going to get stopped out. So to limit my risk, I’ll immediately look at stocks that I can trade short (sell). For example, I am currently long four stocks. And all four stocks are in a the negative. So, in the last two weeks I’ve decided to short three resource stocks (as a hedge). This way, I’m now down only 3% of my portfolio rather than 5% since the drawdown… Minimise Drawdown Part #4: Other ways The other powerful way to control your drawdown is to lock in profits when the trades are going your way. You can think of it as a trailing stop loss. I personally often raise my stop loss when the market moves where the risk to reward is 1:1… This way I know I’ll lock in a gain, should the market turn against me. There are many ways you can adjust your stop loss including: • Trail the stop loss as the price moves further away from the trending Moving Average • Trail the stop loss after the market’s price moves a certain percentage • Trail the stop loss when you see volume starting to drop • Trail the stop loss when an indicator is oversold or overbought • Trail the stop loss after the market’s price moves to a certain risk to reward FINAL WORDS Drawdowns are inevitable. And you need to know how to manage your Drawdowns… You now have some ideas on how to handle your drawdowns better. Trade well, live free. Timon MATI Trader (Financial trader since 2003) Feel free to follow my socials below. I love writing about trading and sharing my 2 decade experiences.
JSE:J200Education
by Timonrosso
1
How Much to Recover After a Trading DrawdownA Drawdown is a drop in a portfolio value after one or more trades. It’s when the portfolio dips from the highest high. Once you’ve entered into the inevitable drawdown phase, you’ll need to know how much you’ll need to recover. That’s where the drawdown calculation comes in… The Drawdown Formula to recover after a portfolio drop Let’s use three examples of traders with drawdowns. Example #1: Timon is down 5% of his portfolio in the last three months. Example #2: Alex is down 50% of her portfolio in the last three months. Example#3: Artemis is down 76% of their portfolio in the last three months. Next we’ll need the Drawdown Formula Required gain = -1 Let’s put in three drawdown percentages to see what we need to recover to get our portfolios back to what they were… EXAMPLE #1: Timon’s drawdown = 5% Required Gain = – 1 = – 1 = 5.26% EXAMPLE #2: Alex’s drawdown = 50% Required Gain = – 1 = – 1 = 100% EXAMPLE #3: Artemis’s drawdown = 76% Required Gain = – 1 = – 1 = 316% In the above examples, I need to recover 5.26% of my portfolio to get it back to its highest level. While Alex and Artemis needs over 100% and 316% to return their portfolios to what they were. Now you know how to calculate what you need to recover after a trading drawdown. FINAL WORDS Do you now get that you need to take your drawdowns more seriously? With any business or venture, you should always be wary when you enter into a tough time. In fact, you should never be down more than 20% on your trading portfolio, business or in any other financial venture… Once you start going below 20%, it will take a heck of a lot longer to get back to what it was… That’s why this article is only part one… Trade well, live free. Timon MATI Trader (Est. 2003) Feel free to follow our socials below.
JSE:J200Education
by Timonrosso
6 Thinking Hats for a TraderIf you don’t know the 6 Thinking Hats by now, I have to ask. How do you solve problems, deal with arguments or make decisions? I do forgive you though, as these strategies are not ones we learn in school. In fact, when I first read about this strategy, I got to say every aspect of my life changed (including trading). I hope this article will change your life too. Let’s start with the main man himself. The Author of The Six Thinking Hats Edward de Bono is a world-renown lateral thinker, writer and philosopher. In fact, he was the first person to use the term ‘Lateral Thinking’. Born in 1933, in Malta, Edward has achieved a number of degrees and has published over 85 books (mostly on thinking and the use of language). But out of all his works of art, there is one of the most popular techniques that changed the world and changed the way we think. It’s called The Six Thinking Hats or 6TH. Here’s how it works There are six different imaginary hats, with each having a different colour. Each time you put on a hat, you change the way you think about something. It also helps you see with better clarity and with a different perspective. Whether you’re having an argument, making a decision, solving a problem, building a business or creating a trading strategy – the 6 Thinking Hats will help streamline the process. If you’re with more people, make sure everyone is wearing the same hat at a time, to avoid conflict. Let’s now get into the inner workings of the 6 Thinking Hats, and how it can apply to your trading and other aspects in life. HAT #1: WHITE NEUTRAL VIEW This is the hat that contains all of the information, facts, data, figures, metrics and statistics. When it comes to trading there are certain facts that you need to have considered including: The broker you choose The affordability The costs involved What equipment you have to trade Back testing, forward testing and real testing data and statistics with your strategy. HAT #2: RED EMOTIONAL VIEW The second hat you’ll put on is the RED HAT. When you put this hat on, come to terms with what you feel. I’m talking about your intuition, your fear, your greed and your gut feeling. Then when it comes to trading ask yourself these questions… · Can you handle risking money you have? · Do you feel you have the discipline to pursue trading on a weekly basis? · Do you enjoy the idea of trading? · How much money do you think you can easily deposit into your trading account? · How much money do you think you can psychologically handle losing, if you take 10 losing trades in a row? · Do you think you can sleep easily at night knowing you have your money tied up in the markets? Once you go through all the feelings and you answer the questions, then you can move to the third hat. HAT #3: YELLOW POSITIVE VIEW This is the hat you’ll find is the one, you want to leave on when you think. It’s the hat that contains all the benefits and rewards. When you put this hat, you’ll think of the following with trading: What are the benefits to trade? How much money do you want to make a year trading? Why will your trading strategy work? What are your goals as a trader? Why is trading the best decision for your financial future? Feeling good? Well you’re supposed to when you put on the yellow hat. But we still have three more hats to go… HAT #4: GREEN CREATIVE VIEW With every decision comes extra out of the box thinking. And that’s where the green hat comes in. When you put on the green hat, this is where your imagination should help you with brainstorming, new ideas and add-ons to the think tank process. With trading, there are just so many different ways to be creative. And you’ll find that with ever evolving markets, you’ll need to adapt and adjust course. Here are some ideas to think of when you put on the green hat. How can I let my winners run further systematically? How can I increase my win/rate i.e. Trailing stop loss What indicator can I use for peripheral vision to help with my confirmation on each trade? I should create and print a few psychology sticky notes to help with my trading. I should name my system to be more personal with it I should find ways to tweak my system which will help with the performance I should have a trading consultation with Timon to help build and optimise my trading strategy better J. HAT #5: BLUE HAT PROCESS VIEW When you put on the blue hat you should think of three main things… Systems, criteria and planning. This is where you’ll choose the criteria you’ll follow with your trading strategy. What indicators are you using? What parameter’s are you using with the indicators? What time frame works best? What calculators do you need whenever you trade? This is where you’ll find the main work takes place once all the planning is done… And one where you’ll eventually marry a strategy to help grow your portfolio. HAT #6: BLACK HAT NEGATIVE VIEW When you put on the black hat, four things should arise instantly. Difficulties, problems, weaknesses and risks… I saved this hat for last, because it’s the only hat that will most likely help you decide whether trading is for you or not. But you can re-arrange the hats according to your won preference. The main things to ask when you put on the black hat, with trading is: What are the dangers of trading, risks, financial risks and time risks? What if the system stops working? Why are you sceptical about trading? What if the current markets go into an unfavourable territory? What if the market drops to zero when I’m in a long trade? FINAL WORDS: How awesome! You now have The Six Thinking Hats to your every decision making process. You’ll find that it will force you out of the mono-lateral way of thinking which you’ve habitually had your entire life. You’ll see things with new perspectives and compartmentalize issues in new ways… It might even pro-long your marriage or improve your relationships… If you enjoyed this article, I would love to hear your thoughts Trade well, live free. Timon MATI TRader (Established 2003)
JSE:J200Education
by Timonrosso
Do you know what it takes to be an Algo Trader?To be an algo trader, you typically need to have a strong background in computer science and programming, as well as a good understanding of financial markets and trading strategies. Here are some of the important elements you need to be a top Alog Trader: Experience with database management and data analysis Knowledge of statistical analysis and machine learning techniques Understanding of financial markets and trading strategies Strong analytical and problem-solving skills Attention to detail and ability to work under pressure Overall, to be algo trader requires a combination of technical expertise, financial knowledge, and strong analytical and problem-solving skills. It can be as simple as having an easy and proven mechanical strategy that you can demo, back test, forward test, analyse, monitor and evaluate your results. This way, you'll have a decent idea on what your system and strategy potentially could yield in the near future. Trade well, live free. MATI Trader Feel free to follow our socials below if you enjoy this content :) Thank you.
JSE:J200Education
by Timonrosso
11 Industries Blockchain will Rule the WorldBlockchain is the one technology that allows people to create unique, specific products, programmes and services online. Instead of downloading a programme, app or making a transaction on a regulated centralized system like Android or IOS, you’ll use a decentralized system to do everything you currently do with the internet. These ideas on how blockchain will disrupt industries will blow your mind. #1: Voting Blockchain and online voting may one day be the main platform where everyone can take part. Think about it. No more standing in a line, casting votes to a local authority in the hopes that your vote will be counted. Having a decentralised system for voting can result in: • No voter manipulation and fraud • One vote per identity • No external influence • Full transparency • Results within seconds • No foul play Once a vote is added to the ledger, it cannot be tampered with, removed or duplicated. And so having a blockchain-based-online voting platform, where everything is updated, in real time and with full transparency – could soon be a reality for elections… #2: Stock market trading & investing Blockchain could one day take over trading institutions and the financial industry as we know it. There will be no more use for brokers and market makers, as everything will be electronic. Investors and traders will choose the blockchain path to: Take control of their own portfolio 24/7 Extra security and privacy which cannot be accessed by anyone Facilitate trades without any costs, commissions or fees Result in much faster and more efficient transactions Improve liquidity and volume with financial markets Reduce fraud and manipulation Trade 24/7 markets including Forex, stocks, indices and cryptos Speed up deposits and withdraws within seconds Rely less on third parties #3: Social media and internet Imagine a Facebook, Tik Tok, YouTube, Instagram or even Twitter that nobody owns. With blockchain and dApps (Decentralised Apps), they would be completely immune to attempts to manipulate, regulate, spy or even shut them down. #4: Buying assets, goods and services Anything of value that can be tracked, traded and recorded on a blockchain network, will allow transactions in one form or another. In fact, we already have individuals and institutions that are buying, selling and exchanging crypto-currencies (i.e. Bitcoin) for tangible products such as vehicles, property, investments and other assets. An asset can also be intangible such as patents, royalties, intellectual property, copy rights and branding. Also, there are blockchain advantages including: • Lower costs • Less risk and danger • Guaranteed transactions • Accurate evaluations #5: Currencies As you’ve seen, crypto-currencies and forms of exchange – can be created and exchanged simply from the digital ether. The decentralised crypto-currencies will continue to provide a form of exchange for products and services as an alternative to general currencies. #6: Music, books and movies Since the days of Napster, Kazaa and Limewire, entertainment companies have tried everything to prevent piracy from wiping out their revenue. Just a few years later, and a single copy of a song, movie or programme could be distributed around the world within seconds. Blockchain and smart contracts technology could create a decentralised and accurate database of rights of ownership. It could also put an end to piracy and other forms of un-authorised copyrighting. The blockchain transaction will be made in a secure and transparent manner in a way the royalties will be distributed to the owner in a fair and an instant payment process. #7: Banking Blockchain will disrupt the entire banking system. By having a decentralised banking network, we won’t have to worry about a bank crisis ever again. The reasons for a blockchain banking system include: Lower transfer fees Less costs and taxes Instant processing time High security No third party Quick overseas transfers Never go offline or off the system Just so you know, all of your banking transactions take place in a digital online wallet. A wallet is the place (programme) where you can store and make transactions. When you have access to your wallet you get two keys. A private and a public key. The private key is a special digital idea or a code of numbers and letters, given to each user that links to their account. This is the code to access and take control of your account where you can transfer funds out of it. A private key is like having a credit card with your credit card number, expiration date and security code. With this information, you can spend as much funds as you like. That’s why you should never share this private key and never lose your private key. The public key is the code (numbers and letters) that is fully available to the public. A simple analogy of a public key is having someone’s bank account number. Anyone with this number can technically send money into your account. NOTE: The public key is known to the public. If you lose your public key, you can find it again with your private key. Just remember to never lose your private key. So with blockchain banking you can imagine how being able to deposit, withdraw, exchange and transfer money, will make things extremely efficient and secure – Don’t you think? #8: Games The next streamed and online game, may be through a decentralised operation – also known as Crypto-gaming. This will allow gamers, programmers and other entities to improve and build on the game to enhance the experience for all users. By having an source place for gaming there’ll be opportunities to: • Build on continuously and expand the game • Create social network of like-minded gamers • Have more stable, secure and transparent operation • Not have to worry about crashes, manipulation and shutdowns • Offer financial benefits for gamers i.e. customising and selling digital collectibles, art or created virtual worlds. #9: Crowd funding Crowd funding has become the new alternative to traditional venture capital, bank funding and self funding. The issues in the past have been where the banks require an existing business with good revenue, venture capitalists need proof that the business is a success and the costs are exorbitant. Soon there’ll be an era where blockchain will take over all three forms of funding. Blockchain will facilitate crowd funding when it comes to funding for projects, businesses, charities and other causes. The beauty about blockchain crowdfunding is that there’ll be: • Enforced funding terms • Instant money returns if the criteria is not met • Lower transaction costs • No middleman • Decentralised platform • Automatic actions according to the criteria stated • Better funding for ICOs (Initial Coin Offerings) And once the terms or funding is met and the transaction is a success – the money will be automatically distributed to the cause without any human error. #10: Health care Blockchain technology will one day be able to keep personal medical file information private and safer that with a central authority. You’ll finally be able to access your medical information with a click of a button and distribute it only to those you trust. With blockchain, healthcare will benefit in ways that you’ll be able to access: • Medical information which can’t be tempered, hacked or removed • Pharmaceutical companies will have a record of past, present and future prescription medicines to collect and deliver to • A list of personal health records of diagnoses, illnesses and private health information • Revolutionise insurance claims and reduce fraud and adjust quotes for members according to their current health situation #11: Supply chain management Blockchain technology will stream line the supply chain for businesses and drop shipping. Every step from requesting a transaction to having a product or service delivered to the customer can be traced, recorded and monitored. The most important element for supply chain management with blockchain is the transparency and validation that occurs between the transactions performed and shared between the suppliers. This includes transactions made through: • Importing & exporting • Shipment • Trade • Drop shipping • Commercial industries • Farming & supplying food Blockchain can replace the traditional supply methods for centralised authorities. The future lies with Blockchain technology I hope I have shared just a little bit of light and stretched your mind ever so slightly on what the future may bring. There is an evolution of the people wanting to take control, improve transparency, cut out the middleman and streamline the process in ways of greater efficiency. One day – this will be our new normal. Trade well, live free. Timon MATI Trader (Financial trader since 2003). If you enjoyed this article let me know, so I can write more around it...
Education
by Timonrosso
TRADERS! One step is a step forwardHello traders, Are you feeling stuck in your trading journey? Are you constantly asking yourself "WHICH WAY AM I MOVING?" Let me tell you something: as long as you are taking one step at a time, you are moving forward. It's easy to get caught up in the day-to-day ups and downs of the financial markets. We can get so focused on the short-term fluctuations that we lose sight of the bigger picture. But here's the thing: those short-term fluctuations are just noise. They may affect your account balance in the short-term, but they don't define your long-term success as a trader. So how do you stay focused on the long-term and keep moving forward? Here are a few tips: Set clear goals for yourself. hat do you want to achieve as a trader? Do you want to be consistently profitable? Do you want to learn a particular trading strategy? Whatever your goals may be, make sure they are specific, measurable, and achievable. Keep a trading journal. Writing down your trades, your thought process, and what you learned can help you reflect on your progress and identify areas for improvement. Seek out education and mentorship. There is always more to learn in trading, and having a mentor or joining a trading community can help you gain new perspectives and stay motivated. Remember that trading is a journey, not a destination. It's easy to get caught up in the thrill of making a big trade or hitting a home run. But the most successful traders are the ones who are in it for the long haul. They are the ones who are consistently learning, adapting, and improving. So don't get discouraged if you have a few losing trades or if you feel like you're not making as much progress as you'd like. Keep taking one step at a time, and you will get there. Trade well, live free. Timon MATI Trader Feel free to support me and follow my socials below...
JSE:J200Education
by Timonrosso
How Blockchain Works in 6 StepsThe future of apps, programmes, trading, investing and businesses all lie in one underlying technology – Blockchain. You’ve probably heard about it when it comes to crypto-currencies. But it extends so far beyond them. In this section, you’ll think of it in a whole new level where you’ll be able to: • Understand blockchain in a nutshell • Understand the power and possibilities it will bring to the world • See the trading and investment opportunities to come Let’s get to it… What blockchain is in a nutshell… In short, a blockchain is one continuous digital ledger of records and transactions which are organised, verified, and positioned next to each other in ‘blocks’ linking a permanent and transparent chain of other ‘blocks’. Here’s a short illustration on how a Blockchain works… The important concept with blockchain is that, the chain “ledger” of transactions are neither stored in a central location nor is managed or run by a single entity. We say the blockchain is decentralised, secure and the transactions are added permanently in a transparent and resilient manner using cryptography (special codes). The parties between the transaction will also remain anonymous while enjoying the security, transparency, speed and cost efficiency. This will have major advantages over centralised systems in a way that: • The transactions will be easy to track • There’ll be less manipulation and corruption • There’s more transparency • There’ll be less costs and less middlemen. NOTE: To alter one block, you’ll need to change every block throughout the network (which is virtually impossible). And as the historical blocks information stays the same – you’ll be able to forever track the old transactions with the given public information. I’m talking about these main sets of information each ‘block’ has. 1. The data of the new block (code or digital fingerprint) 2. The hash of the previous block (code – letters & numbers) 3. A time stamp 4. Transaction data Once you understand the process and how secure a blockchain is, you’ll see how it will not only disrupt industries but it will also change the global and financial economy as we know it. Trade well, live free. Timon MATI Trader (Financial trader since 2003). Feel free to follow my socials for more real-time posts!
Education
by Timonrosso
1
Why Multitasking is Dangerous for Traders – 6 REASONSWe have come to believe that juggling multiple tasks, will somehow reward us eventually. But with trading, I can’t think of anything worse. In fact, I think it’s counterproductive to multi-task when making financial decisions for your trading. And no! Lying on the couch, or on the beach with your phone while talking to friends is ALSO a no go. Here’s why I think multi-tasking is dangerous… DANGER #1: You miss crucial opportunities: If you’re focused on watching TV, eating chips and watching TikToks at the same time, I guarantee – you will miss out on high probability trades. You need to have full focus and pay attention to the markets, when you’re trading or it will affect the quality of your trading and setups. Danger #2: Delays in trading decision making Multitasking can slow down your decision-making process and prevent you from acting in a timely manner. Think about it… It’s one more video to watch, it’s 10 more minutes until the show ends. Let me just finish my beer first. The market waits for NO ONE! So act accordingly. Danger #3: Stress levels through the roof You’re going to make impulsive, emotional decisions. You have your heard earned money in an account ready to take on the local and global markets. If you have sounds, food and other distractions in the background – it will affect your stress. This will not only put you off trading but might also scare you out of it completely. These types of decisions can be costly in trading. I mean, trading can be stressful enough on its own. Add multitasking to the mix and your levels of stress and increase feelings of anxiety will sky rocket. This can lead to burnout and negatively impact our overall performance. Danger #4: Drop in prod You might feel that you can get more done by multi-tasking but it actually will decrease your productivity and efficiency. When we try to do too many things at once, it takes us longer to complete each task and we may not do them as well as if we had focused on them individually. Danger #5: More mistakes Trading needs to be laser focused! If you multi-task you need to remember something. You are human and you are susceptible to making mistakes and errors. You might miss a trade setup. You might type in the wrong trading levels. Or worse… Trading volume. You might miss opportunities to lock in profits through adjustments. Just take it one trade at a time and focus on the time in the markets… Danger #6: Ruin relationships Ok this one is a bit of a stretch, but I think it relevant. If you multi-task while trading, what about the rest of your life. You most likely will multi-task while eating dinner, talking to friends, driving or even spending time with your children. This can most definitely have a negative effect on not only your trading but your life, relationships and will lead to even more stress… If you’re still reading this then I want you to do something for me. I want you right now to take a DEEP breath in…. . . . . . And out….. Just slow down. Take it easy. Focus on one thing at a time and enjoy the process. Be more present and you will find life will be a lot more easier in your everyday. I am writing this because I want you to start your year on a calm, focused and powerful note. You got this. Trade well, live free and take it EASY! Timon MATI Trader
JSE:J200Education
by Timonrosso
3
How a Simple Cup of Tea Can Improve Your TradingTraders are always on the lookout for ways to improve their performance. They are always trying to find ways to make better decisions in the markets. While most people might not think to turn to tea as a solution, it turns out that… This simple beverage can actually have a surprising impact on trading. The amazing benefits of drinking tea with trading. Benefit #1: Relaxation What is amazing about tea is its ability to help you relax and calm you better. In the fast-paced and high-stress world of trading, it’s easy to get caught up in the excitement and intensity of the markets. This can lead to impulsive, emotional decision making that can be costly. Once you have a cup of tea, it can help you take a step back, relax and allow you to approach the markets with a clearer and more rational mindset. Benefit #2: Focus Tea can also improve focus and concentration. Many traders rely on caffeine to help them stay alert and focused, but it’s important to remember that too much caffeine can lead to jitters and anxiety. Tea, on the other hand, contains a lower amount of caffeine and also includes antioxidants and other compounds that can help improve cognitive function. My favourite tea is good old Rooibos “Red Bush” which is a special tea from South Africa that doesn’t contain any caffeine. When you sip on a cup of tea, you’ll find it will help improve your focus and attention to detail. This is crucial when analysing the markets and making financial decisions. Benefit #3: Health Great health is great wealth. Another benefit of tea is that it can improve with your physical health. You’ll find trading can be a sedentary job, and it’s important to take care of our bodies in order to maintain optimal performance. Tea is packed with antioxidants and other compounds that can help improve digestion, boost the immune system, and reduce the risk of certain health conditions. When you add tea into your daily routine, you will most definitely improve your overall health and well-being, which can in turn improve your performance in the markets. Of course, it’s important to remember that tea is just one piece of the puzzle when it comes to improving trading performance. It’s important to have a solid trading strategy, stay informed about market developments, and manage risk effectively. In conclusion! Not only does this simple beverage promote relaxation and calmness, allowing you to approach the markets with a clear and rational mindset, it can also improve focus and concentration, thanks to its lower levels of caffeine and cognitive-boosting compounds. And, let’s not forget the physical benefits – by incorporating tea into your daily routine, you can improve your overall health and well-being, leading to better performance in the markets. So, trade well, live free, and don’t forget to enjoy a cup of tea! Timon MATI Trader (Financial trader since 2003)
JSE:J200Education
by Timonrosso
1
24 Hour Trading Stocks Around the Clocks!Doesn’t it feel almost inevitable? That in the near future we’ll be able to trade shares 24 hours a day, five days a week? Well, during the last week, I’ve been wondering what the future of trading will look like and what we need to prepare for. In this article, we’ll go through the practicalities of trading 24hour markets and what you may need to prepare for. 24 Hour markets available today Right now, there are more markets available to trade 24 hours a day than ever before including: • Forex • Commodities • Crypto-currencies • Exchange-Traded-Funds • Indices I guess the important question to ask is… Will it make a big difference if the world opened up to trading stocks 24 hours a day? Could it be the end of stock traded sessions? Currently, the trading sessions for shares are restricted to the hours the exchanges are opened. This is normally from 9:00am until 5:00pm. There are two historical reasons for having stock traded sessions: Maintain liquidity and timing for efficiency during operating hours. But what would happen if stocks never closed their trading times? Think about it… We’d have hundreds of thousands of stocks open to the public to trade at your disposal whenever you desire… We’ll need to address the pros and cons of how this would work… GOOD & BAD reasons for trading stocks around the clock Let’s start with the BAD. BAD #1: Less trading – Small price moves We could see thin volume of buying and selling taking place for each stock, as there’ll be little demand when people are off work or asleep. BAD #2: Higher price manipulation With the low trading volume, this can incite shady investors and traders to manipulate the share prices, causing major sudden price fluctuations So with low demand and movements for stock trading around the clock – right now, it just doesn’t seem to be practical having 24/5 stock trading sessions. But right now – does not mean it will always be like this in the future. Here are the GOOD reasons for a 24 hour trading stocks around the clock. GOOD #1: Higher employment numbers Most companies, will need to employ more brokers and dealers – for after hours – until they incorporate robo-advisors… GOOD #2: No more open price gaps The unexpected sudden price gaps on stocks will almost be eliminated. You won’t have to wake up to a nasty surprise seeing the market jump your stop loss overnight again. GOOD #3: Follow international events We will be able to base stock trading decisions and prices on any news event, earnings and ratings that comes out internationally. GOOD #4: New stream of investors This will attract many new investors and traders to trade stocks from other countries which will help companies share liquidity. Why we could see trading stocks around the clock in the future We are seeing a major rise in the number of investors and traders. Trading has never: • Been more affordable • Been easier to learn. • Been more accessible (with just a smart phone). • Shown such superior customer services. And we definitely have the technological structure and networks, to support around the clock trading for all markets. And when it comes to stocks. Well, with the increase in adoption of new technologies, and improvements with off-market liquidity – we will very well see stocks trading around the clock. And now you know what to prepare for… Trade well, live free. Timon MATI Trader (Est. 2003)
JSE:J200Education
by Timonrosso
Happy New Year 2023 - Only 1 tip for you!If you don't know your trading levels, then you don't have a game plan... The only time you're ready to trade is where you have the exit plan in mind through risk and reward as well as WORST case scenario... Are you ready to trade in 2023! My only tip for this year is go where you are appreciated NOT where you are tolerated. Trading View is such a special place because we all have one thing in common. To take control of our own life without any dependency. I've been trading since 2003 and now have the platform to share some ideas and experiences that I've gone through to eventually trade for a living from 2011. Welcome to 2023. May it be a year of learning, improving, growing and profiting. Trade well, Live free... Timon MATI Trader
JSE:J200Education
by Timonrosso
1
What Billionaires Taught me About TradingDid you ever wonder why influential people wear the same clothes every day? • Mark Zuckerberg wears his famous round neck grey t-shirt. • Richard Branson wears his famous pair of jeans. • Steve Jobs wore his black turtle neck. • Barack Obama wears either his blue or grey suit. Well other than promoting their signature look, there is a much more deeper and important reason for it… You might want to consider this analogy for not only trading, but for every important aspect of your life. Why Mark Zuckerberg wears the same outfit Facebook CEO, Mark Zuckerberg held the first ever public Q&A session at FB California headquarters in November 2014. During the hour session, he was asked why he wears the same grey t-shirt every day. Here was his answer: “I really want to clear my life to make it so that I have to make as few decisions as possible about anything except how to best serve this community,” “I feel like I’m not doing my job if I spend any of my energy on things that are silly or frivolous about my life,” Less decisions – More success This concept to make one decision on what outfit to wear, is to help prevent ‘cognitive fatigue’. One less decision to worry about in life will save your brainpower capacity to help make decisions that matter for the future. Besides, the more decisions you make – the more complicated life is. Ok, so you got the gist… Here’s what this lesson taught me about trading As a trader, there is plethora of events taking place every day. There are countless factors to consider: • Markets (Forex, shares, indices, commodities and cryptos) • News events (Employment, GDP, macro & micro announcements) • Indicators (Moving averages, RSI, MACD, Price action etc…) • Time frames (Tick, 5 minutes, 30 minutes, daily, weekly) • Strategies (Moving average crossovers, breakout patterns, volume analysis) It’s enough to test everything until the end of time! That’s why, I have personally worn the same metaphorical outfit for the last 14 years. NOTE: It took me 7 years to find this outfit! 1 Strategy – MATI Trader System 1 Time frame – Daily 1 Indicator – Price action 1 Risk level – 2% 1 Financial instrument – CFDs It’s all about finding what you find comfortable, consistent and sustainable… How to find your one outfit when you trade This is most definitely a self-introspection journey to find the ‘outfit’ you will be wearing as a trader. To start, write down your trading strategy and markets you want to trade… My biggest tip – Keep it simple, minimalistic and comfortable…
JSE:J200Education
by Timonrosso
1
5 Habits of Successful TradingGet a pen and paper and write these five habits down. Each habit you have, write down a 1 and each habit you don’t have write a 0. Sum up the points at the end and you’ll know where you are, what you have to do to improve and whether you have the trading edge to be successful. HABIT #1: Courage You need the courage to follow these basic steps. #1: Open a trading account #2: Deposit money in your trading account #3: Adopt a trading strategy #4: Take the trades that line up #5: Follow your strategy (with the winners and losers) Have the courage to do that today or have done it? Mark 1 for YES Mark 0 if you’re not ready… HABIT #2: Persistence I’ve said this before… Trading is a forever business… It’s easy once you get it right. The hard part after a while is keeping persistent. Do you have the PERSISTENCE to: #1: Trade for a few minutes every week? #2: Look for trading setups? #3: Follow a proven trading strategy without changing the rules? #4: Not give up on a trading strategy after a losing streak? #5: Not go against a strategy after during a winning streak? Mark 1 for YES Mark 0 if you’re not ready… HABIT #3: Save Money Look. The more money you have in your trading account, the faster it will grow. If you think R5,000 or R10,000 is all you need to retire in a few years – it’s time to wake up! Every month, I deposit around 5% -10% of my savings into trading… Now I know not everyone can deposit such a large portion of their savings in trading as they have other capital allocations to their portfolio… Well, what ever you can deposit per month comfortably is better than nothing. This will help you to grow your trading account at a faster rate. Mark 1 for YES – I have the habit to save money per month. Mark 0 if you’re not ready… HABIT #4: Evolve The markets are constantly going through change. In just a span of 20 years there have been a multitude of trading instruments. For example: Shares – warrants – Futures – Binary Options – ETFs and CFDs. We’ve also seen a plethora of different markets including Equities – Indices – commodities – currencies and Crypto-currencies And as a trader, it’s our job to keep learning and evolving with the markets… Do you have the habit to adapt to change and learn throughout your trading career? Mark 1 Not ready for change? Mark 0 Habit #5: INDEPENDENCE Once you have everything you need to succeed as a trader, it’s all on you. You should not have anyone to hold your hand, influence your decisions or tell you what to do. When you are sitting by your laptop or device – No one should be able to change your mind including from: • Friends • Family • Mentors • Your conscience • Bloomberg • Spouse and kids If you think you have a good level of independence, mark 1. If you’re not ready for being independent mark 0. Final Thoughts The points where you marked 1 – Great keep at it and remember your strengths… The points where you marked 0 – It’s ok… Every successful trader started with doubts and weaknesses. Trade well, live free. Timon Rossolimos MATI Trader
JSE:J200Education
by Timonrosso
WARNING! This will reflect on your tradingThe world thrives on drama, gossip and most people just want it to end by the way they think... I can't blame them because most people are struggling to live their lives where they are working from pay check to pay check. Where they are hoping their boss will give them a half day off. Where they are constantly feeding the fat cats of the world and paying taxes from their salaries. But then trading comes along, where you can have some degree of control of your finances and investments. Where you can risk what you wish and play the rules with growing a portfolio,... BUT if you bring in your emotional aggression and tendencies, it will reflect on your trading... Instead, you should work on yourself more. Don't be angry over unnecessary things Don't make a mountain out of a mole hill Don't risk anything you can't afford to lose Don't get angry over a small loss - you are in the trading den to make money NOT to be right Take 10 DEEP breaths in and out before you make any impulsive decisions or take any abrasive action. Focus on change and the whole world, your mind and your trading results will change with you... Let me know if this helps by commenting below or at least liking this post. Trade well, live free, Timon MATI Trader
JSE:J200Education
by Timonrosso
MOST DANGEROUS TRADING TRAIT!Most people talk about Fear and Greed being the barometers to failure... I think there is an underlying trait that is far superior which leads to ultimate account catastrophe. EGO. They just want to be right or they will have a hissy fit. They refuse to take a loss... They refuse to accept that the market is moving against you. They find ways to disagree with the market which gets them committing moe. They move their stop loss away further away - which means they risk more. Rinse and repeat - GONE. Cut out your ego or the markets will cut you out. Simple. Trade well, live free. Timon MATI Trader
JSE:J200Education
by Timonrosso
END Procrastination Today with 7 TipsOne of the biggest issue a trader has is none other than procrastination. • They doubt their trades – so they don’t take them. • They skip a trading day – so they miss opportunities. • They don’t monitor their results on a weekly or bi-monthly basis- so they can’ track their performance. Initially, I thought it was because of a lack of confidence. But to be honest, I think it’s something a lot more transparent. LIFE! You have a life to live, income to earn, food to put on the table, things to do with your family and loved ones and the general duties of life. So it’s all down to priorities at the end of the day. Because my life has been dedicated to trading since 2003, it’s why I don’t procrastinate – take a day off or anything of the sorts. So I’m going to give you some pointers on how to stop procrastination or at least reduce it… TIP #1: CHOOSE YOUR TRADING DAYS If you really don’t have the energy (not the time, everyone has time), then just choose two or three days to trade. And find the best time to locate to your trading. Maybe it’s first thing in the morning when you’re having coffee or breakfast. Maybe it’s when you come home after work and before you get onto the social media world. Maybe it’s an hour before bed or Netflix. Adopt it into your life in a way that it is comfortable and manageable for the future. TIP #2: SET SMALLER TASKS Break larger tasks into smaller, more manageable chunks. This will make it easier to start working on a task and to make progress. Instead of looking at EVERY market in one day, to drive you crazy. Choose a sector market and only focus on that watchlist… E.g. Local stocks one day, Forex another day and international markets another day. TIP #3: TRACK RESULTS ON A SPECIFIC DAY Choose a day in the week, where you’ll jot in your trades that you added, adjusted or closed. Create a schedule and stick to it. Having a structured plan can help you stay on track and avoid getting side-tracked by less important tasks. TIP #4: SET A TIMER If you have only 1 hour to trade, set the timer. You’ll find with a timer, you’ll be more focused determined and less distracted with anything else. TIP #5: REMOVE DISTRACTIONS Stop the distractions from your workspace. This may include turning off notifications on your phone or computer, finding a quiet place to work, or using noise-cancelling headphones. TIP #6: SELF-TALK YOURSELF Use positive self-talk to motivate yourself to do it. Psychology is an important element to your trading. Instead of telling yourself that you can't do something or that it will be too hard, try telling yourself that you are capable and that you can do it. TIP #7: REWARD YOURSELF Reward yourself for making progress of following with your trading actions. This could be as simple as taking a short break or treat yourself to something you enjoy. These are just a few ideas on how you can end your procrastination from your trading endeavours… There will be no change in your life without action, so always keep the prize in mind and you should have all the determination in the world to GO FOR IT. If you enjoyed this feel free to LIKE and follow for more daily tips. Trade well, live free. Timon MATI Trader
Editors' picks
JSE:J200Education
by Timonrosso
19
Russell 2000 Index - EXPLAINED - What, Why, Where, How?Small cap stocks, Penny stocks and pink sheets are the high adrenaline stocks investors play games in. They are generally the cheaper, highly volatile, some are illiquid and can fluctuate 50% - 1,000% a day. From the Wolf of Wallstreet glamorizing the potential returns for investors to your every day salesman broker trying to sell you the next winner. But what is the Russell 2000 Index and what should we know about it? I’m going to sum it up a bit of information about how it works and important facts you need to know Enjoy! WHAT IS IT? The Russell 2000 Index (listed in 1984) is a stock market index that tracks the performance of small-cap publicly traded companies in the United States. It is named after the Russell Investment Group, which operates the index. The share price can vary significantly, as it is made up of a diverse range of small-cap publicly traded companies. MARKET CAP Small-cap stocks are generally ones with a market capitalization of between: $50 million and $2 billion. CRITERIA TO LIST STOCKS There are a few criteria that needs to be met to qualify for the inclusion in the Russell 2000 Index: • The company must be a publicly traded U.S. company. • It must market capitalization of at least $50 million. • Must be ranked in the bottom 2,000 of the Russell 3000 Index, based on market capitalization. • Must meet certain liquidity requirements, including having a minimum average daily trading volume of at least 250 shares over the previous six months. • Must have a minimum of one year of trading history. WHAT IT CONSISTS OF The index is made up of the smallest 2,000 publicly traded companies in the Russell 3000 Index, which represents approximately 98% of the total market capitalization of all publicly traded companies in the United States. HOW IT OPERATES The index is reconstituted annually, with new companies added and removed based on their market capitalization and other factors. VOLATILITY & LIQUIDITY The Russell 2000 Index has a high level of volatility (greater price swings) and low liquidity (ease of flow of orders) compared to other large cap stocks. DANGERS WITH THE INDEX Currency risk: When the US dollar drops the index can follow Diversification: There is no sector for the stocks. When the index drops the stocks follow. Liquidity: You might find difficulties finding buyers or sellers to ease in or out of your positions. Volatility: The jumpiness in the market is highly erratic. Lack of analyst analysis: You’ll hardly see news coverage via the media which means, you could be left in the dark with what is going on in the companies. Liquidation risk: You have a higher chance at being in a company that is about to be liquidated due to financial issues, no growth, manipulation and cooking the books. Economic issues: When global economies collapse, stocks drop with it. Small cap stocks are no exceptions. This can affect the investment prospects .
TVC:RUTEducation
by Timonrosso
EXPLAINED: Short Selling in 3 ways and with an exampleWhat is Short Selling? This is where you sell (go short) an underlying market at a high price, anticipate a drop in price where you’ll buy it back at a lower price for a profit. How short selling works… To understand this concept, I’m going to break it down into three explanations. • One line • Step by Step • Visual Explanation #1: One line Short selling is the practice of selling a financial market (such as a share, crypto currency, index etc…) that you don’t own with the intention of buying the same market back later on at a lower price for a profit. Explanation #2: Step-by-Step 1. You sell a number of shares, which you don’t own, at a higher price. NOTE: You borrow the shares from a broker or lender. 2. After time passes, the market then comes down in price. 3. You then decide to buy back the shares and close your position for a profit. NOTE: When you buy the position back, you automatically return the borrowed shares to the broker/lender and pay them a fee. 4. You will pocket the difference between the price from where you sold the shares and the price where you bought them back. The Broker gets the shares back you get the profit – bada bing bada boom – DONE. Let me know what other term you would like explained. Trade well, live free. Timon MATI Trader
JSE:J200Education
by Timonrosso
EXPLAINED DIXIE (US Dollar Currency Index) What, why where, how?The US Dollar has been in the limelight and not in a good way. In fact, he US dollar has not been dimmer since 22 September 2022 where it was trading at 114.42. Currently it’s at 103.90 (9.19%) down… But what does it all mean? Why is the Dixie such a popular index to understand, and trade. You see it in the news every time you turn on Bloomberg and you see it in the publications. So we might as well understand it for the next time they mention the Dixie. IN this short article I’m going to answer the 6 most important questions, to help you understand the Dixie is, how it’s calculated and how to trade it… 1. WHAT IT IS? The U.S. Dollar Index – DIXIE - (USDX) was first intrpduced in March 1973 and is a measure of the value of the U.S. dollar relative to a basket of foreign currencies. 2. HOW IT’S CALCULATED The USDX is calculated by the Federal Reserve Bank of New York and is based on the exchange rates of six major currencies: the euro (EUR) – Accounts for 57.6% - ,Japanese yen (JPY), British pound (GBP), Canadian dollar (CAD), Swedish krona (SEK), and Swiss franc (CHF) . 3. ECONOMY GAUZE The DIXIE is used as a barometer for the value of the US dollar to base it on the potential strength of weakness of the U.S Economy. 4. TRADED BASED ON The USDX is traded on financial markets, and its value moves based on certain macro aspects such as: Changes in exchange rates, economic conditions, and global market trends. 5. USE Investors and financial institutions uses the USDX is often to hedge against currency risk, as well as to speculate on changes in the value of the U.S. dollar. 6. HIGHER VERSUS LOWER VALUE If the Dixie goes up this means the US Dollar is gaining strength against the other currencies. The more it goes up the more it appreciates which indicates a stronger US dollar – Stronger economy – more confidence in the US dollar. If the Dixie drops, it means the US dollar is getting weaker against the other currencies in the basket for the index. As it drops more, it depreciated which tells us the US dollar is getting weaker which means – a weaker economy and less confidence in the US dollar. If this was interesting let me know in the comments or hit the like button and let me know what else you would like to learn about in bite size information. Trade well, live free. Timon MATI Trader
TVC:DXYEducation
by Timonrosso
BEFORE YOU TRADE - Look - Calculate - RememberI don’t care if you’re new or old to the trading business. This will apply to you, regardless. In this short but vital article, we’ll go through 3 of “Before you do this – You need to do that”. #1: BEFORE YOU TRADE – LOOK Trading is a strategy game. You don’t just thumb suck a trade and guess where the market will head. No, you have your criteria on: • The markets you’ll analyse • The time frames you’ll use • The criteria you’ll follow • The entry, exit and risk levels you’ll apply Before you take a trade, you need to first look and find synergy between your strategy and the market you’re looking at. #2: BEFORE YOU SPEND – CALCULATE Trading is a risk game. You don’t just put in all your money in a trade because it feels good or looks too good to not risk. You are not in the game to be right… You are in the game to play calculated risks with your winners as well as your losers. I have a 2% risk rule per trade, in order to bank a 4% gain. This is the best strategy that works for my 19 year old, 4 step strategy, 62.5% win rate MATI Trader System. Whether the trade looks incredibly attractive and is almost a given, it doesn’t matter. Calculate your risks, follow your rules and calculate before your spend. #3: BEFORE YOU GET EMOTIONAL – REMEMBER Trading is a mind game. It can play with your emotions at times. • A loss can ruin your week. • A win can make you feel like a megalomaniac for a day. • Your birthday can make you think you’ll profit that day. • Your previous loss can cause you to doubt your trading strategy. • Your previous winner can scare you. “You need to remember that the financial markets don’t know you, care for you and remember that trading is a forever business.” Next time when you feel those emotions taking over, just remember that sentence… Did you find this useful, follow for more daily trading tips... Trade well, live free. Timon MATI Trader
JSE:J200Education
by Timonrosso
1
WARNING! This will reflect on your tradingThe world thrives on drama, gossip and most people just want it to end by the way they think.... I can't blame them because most people are struggling to live their lives where they are working from pay check to pay check. Where they are hoping their boss will give them a half day off. Where they are constantly feeding the fat cats of the world and paying taxes from their salaries. But then trading comes along, where you can have some degree of control of your finances and investments. Where you can risk what you wish and play the rules with growing a portfolio,... BUT if you bring in your emotional aggression and tendencies, it will reflect on your trading... Instead, you should work on yourself more. Don't be angry over unnecessary things Don't make a mountain out of a mole hill Don't risk anything you can't afford to lose Don't get angry over a small loss - you are in the trading den to make money NOT to be right Take 10 DEEP breaths in and out before you make any impulsive decisions or take any abrasive action. Focus on change and the whole world, your mind and your trading results will change with you... Let me know if this helps. Trade well, live free. Timon MATI Trader
JSE:J200Education
by Timonrosso
1
9 SIGNS You're Trading Well! Trading well is a marathon and not a quick race. It doesn’t matter how much money you banked in a week, winners you took or how much money you have in your account. What does matter is one word “Persistence”. And with persistence comes, 10 signs that you’re doing well with trading. Let’s get to them… Sign #1: You have the passion to LEARN how to trade When you learn to trade, it’s not only a strategy game but also a self-introspection journey. You get to understand who you are as a trader in a way that you learn: • What time you wish to trade • What markets you’d like to look at • The instrument you want to buy/sell • The broker that best suits your needs If you have the passion to learn what fits your personality when trading, it’s a good sign you’ll do super… Sign #2: You have a solid daily trading routine There is no right or wrong way to go about your trading. Once again, it’s what you feel comfortable with on a daily or weekly basis. Maybe it is reading MATI Trader first thing in the morning, then going through your watchlist and seeing which trades are lining up. Afterwards you set your trading levels and take your trade. Whatever your trading routine is, make sure you have a checklist to follow. Sign #3: You have strict rules to follow Rules are the only way to find consistent opportunities within the chaos. I have three rules with trading. 1. Never risk more than 2% per trade (no matter the portfolio account). 2. Never risk any money you can’t afford to lose 3. Never hold more than 5 trades at any one time. If you have rules to follow, you’re doing well… Sign #4: You have tunnel vision There are no two traders that are the same. This means, when you know who you are, you’ll know to ONLY follow your rules, strategy and vibe. If someone tries to change your mind, put your blinkers on and remember the proven strategy you KNOW works. Don’t listen to others and don’t care about where other traders are in their career. Sign #5: You have a track record Whether you’re still demo-trading or live-trading, it doesn’t matter. All you need to make sure is that you have an excel sheet or written pad with all of your trades you have taken or backtested. This is will remind you and give you proof of what works and will make you a consistent income during your trading. Sign #6: You have the time to trade You’ll need to choose the time, that suits you best to analyse and trade the markets. It can be first thing in the morning, during your break in the afternoon or even 2am when you wake up and can’t go back to sleep. Sign #7: You can psychologically handle it Trading is mostly mindset. How you deal with your winners, losers and with your trading longevity. If you are prepared to mentally handle everything trading comes with – you’re well on your way to a bright trading future. Sign #8: You have a dream As much as trading is fun during the process, we all have a future idea on where trading will take us. Some want to travel around the world and not have to worry about budgeting. Others want to just spend their time during retirement keeping their brain active and seeing trading as a forever-challenge. Me, I love to trade, teach how to trade and create financial freedom for my future and for generations to come. What is your dream? Sign #9: You have your trading system The game-plan… Do you know where to enter, exit and place your risk levels every time? If so, GOOD. You have a trading system. This is all part of trading well. If you enjoyed this article feel free to LIKE and Follow for more daily trading tips articles. This is information I've gathered since 2003. Trade well, live free. Timon MATI Trader
NASDAQ:NDXEducation
by Timonrosso