To become a Trader

Hi guys, hi from Andrea Unger! The path of a trader! I’m answering here a message on Facebook from
a friend of mine, a Facebook friend who contacted me a couple of years ago asking for my mentoring
to become a trader. Two years ago, when he explained his situation
to me, I suggested him not to invest any money in my Unger Academy. Am I crazy? Not really! I gave him this suggestion because I believed
he would not get any benefit from the education that Unger Academy could provide. Simply because I thought that his approach
to Andrea Unger was driven by the idea that Andrea Unger proved to be good so he can be
good also for me and teach me how to become a good trader. So he was not looking for something to grow
his personal baggage of information, but it was only looking for somebody who was good
in his mind not, caring about the content of what I could eventually teach and not evaluating
if that kind of content was fine with him, if that was something he could cope with. Not everybody is good for automated trading
because this is what I eventually teach and not everybody can become an automated trader
if he has not the proper mindset of doing so. So why do I think that this is so important? I believe that it is important when you approach
an educational path to increase your skills, to understand first what direction you are
willing to go and what could be good for you and then become a specialist on that by studying
that specific topic. I suggest automated trading because I believe
that it is something that can be taught easier or can be learned easier, both sides, but
not always this is the solution. In this case, I believe it would not be a
good choice at that stage for him because he was actually not really evaluating anything
about automated trading. He was just in a foggy environment about trading
and thought about Andrea Unger because somebody told him that Andrea Unger was good. I suggested him an online material so that
he could increase his general point of view about trading or his overview. I actually suggested him also to quit trading
because his motivation was more driven from the necessity of an income and you know that
I try to keep people away from trading if they just want to do it to make money, but
he went on and he wrote to me yesterday claiming that he was now able to trade for a living,
which I’m very happy about. He also explained to me a little bit, that
he’s specialized on trading gold. Perfect! The question now is… I often suggest to diversify and here it comes
a guy claiming that he makes money being specialized on a specific instrument. There is nothing wrong with comparing the
two point of view. I can tell you that I strongly believe that
diversification is a great tool to help to trade smoothly the market, but if you trade
markets with a discretionary approach the specialization and the deep knowledge of a
specific market helps enormously, because when you know a market deeply and heavily,
obviously you become one with this market and when you trade that market you are in
your environment, let’s say, so it’s a great help to be specialized on the market. In automated trading, which is what I do,
it’s not really necessary, obviously it always helps to know what the market does, how it
behaves, but it’s not really necessary because you analyze a number of markets with the same
tools and the same matrix and reading these matrices, these results, you define what to
do and so in this case diversification is important because you distribute your efforts
and your results on a number of different instruments, minimizing the risk of contemporary
failure (I hope really it doesn’t happen tomorrow). As a discretionary trader, you cannot focus
on many markets and you need to focus on some, maybe one, becoming a specialist. At the end of last year in China, I met the
king of copper, it was a very nice guy who was extremely specialized in trading copper
futures. He was successful thanks to his deep knowledge
of that instrument, so it’s fine if you are a discretionary trader to specialize on a
market so that you know the evolution of the market and you know what is going on and what
you should do to keep on being in profit. The next thing he talked about was the performance,
so he said that he made X percent in 2017, Y% in 2018 and he said that in 2019 he was
more or less break even. Well we are just at the beginning so this
is not a problem actually, but the problem was the reason why he claimed to be breakeven
and not successful. He said: “I’m not able to make the aimed profits
because of the reduction of leverage. I have no longer the 400 leverage, now new
ESMA rules maximum is 30 and without the 400 leverage I can’t make the profits I was making,
so I’m planning to change my broker with an Australian broker who is not yet linked to
the ESMA rules in Europe”. This is a problem actually and I’m answering
to this friend of mine through this video. If the profits you made are depending on the
leverage and exclusively depending on the leverage you used, you are in great danger
because you are heavily underestimating risk. If you make money just because you use heavy
leverage you must consider that you have been lucky making money in the last two years which
was fine, I’m happy about that, but you are really risking too much. You should consider whatever you have done
throughout the two years, in a situation where: what could have happened if one or two trades
went wrong, really wrong? What would have happened in that case? Because the fact that you were extremely good
in choosing the entry the exit and whatever, it does not mean that nothing bad, really
bad could happen and if leverage is the reason for your profits it means you were heavily
leveraged which means if things went wrong you would have lost a lot, if not all the
money you had. So leverage should never be the reason and
the profits should never be the starting point to analyze the results. You should always start from the risk, also
imagining scenarios which hopefully did not happen, but which could have happened and
what would have happened in that case to my account. Always be pessimistic when you analyze, so
leverage is not the reason, I can tell you that the new ESMA rules are a great help for
traders, because they protect you from taking excessive risk and they are still risky in
my opinion, but there is no longer that excessive risk, because any strategy depending exclusively
on high leverage has something wrong inside. Many people would now justify saying: “Yes,
but look I have this and that…”, okay, everything can be fine, but believe me, somewhere there
is a weakness and if that weakness becomes a problem it will be a big problem!!! So leverage is not the solution to become
profitable, this is very important. This is more or less it. Whoever is really interested and motivated
in mechanical automated trading, Unger Academy is the right place to go, but there are also
other places, I mean I am not promoting myself here, I just said it. But if you are just struggling in understanding
what would I do to trade, what is trading, there is still something in the Academy that
can help you. Those who come to the Facebook page also find
a link to an evaluation test to understand what level they are and what they should choose
and so on, but this is a way to help you. Maybe sometimes you know my answer is: “Forget
about trading! Don’t trade!” this is something I often say
and I believe that some of you who are listening to this video maybe are those who I answered
please don’t trade, forget about trading. It’s not a bad thing, I mean I’m not offending
anybody saying this. I’m trying to protect people when I have a
feeling that they have a complete misconception of trading. There are people who clearly approach trading
with a completely wrong idea about trading and these people I normally prefer to suggest
to keep away from trading, which is very important. When somebody comes and thinks that you can
make a lot of money studying a course of a couple of hours, I try to convince him that
trading is not the place to be, because if he realizes this from the very start and listens
to my words, he will protect his capital. The other way to realize that is trading and
losing money, which is obviously more painful than listening to my words. I hope you don’t feel I’m arrogant saying
that trading is not for everybody, I hope you take it the right way and when I suggest
you keep away from trading you listen to me or maybe you explain me your reasons that
I can obviously be wrong in my evaluation and I can change my mind, but if I feel that
somebody would be harmed entering the world of trading I openly say it because I don’t
want any victim on my personal path, as an educator of course. That’s it guys, maybe I forgot something,
please write your comments here below the video, I will try to answer them and we can
open interesting discussions here because I think it’s something that has to be deepened
further and further. That’s it guys, ciao from Andrea Unger see
you next time, ciao! Enjoyed it? Click the link below
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