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Trading Education Posted by Team Topstep April 4, 2018

How This Funded Trader is Profiting with Just 31% Winning Days

Bob R Funded Trader

For years, Bob R. (Viroqua, Wisconsin) says he was like Jim Carrey’s character in Liar Liar. He would beat himself up whenever his trades went the wrong way. But even when he was struggling, part of him knew he would be a better trader if he could just change his mindset.

That realization led Bob to work on his attitude and stop trying to be right all the time in his trades. Now, Bob is comfortable being wrong — so long as it’s not at the expense of being profitable.

Since earning a Funded Account®, Bob has only been profitable on 31% of his trading days. And he’s profitable on just 40% of his trades.

Those are stats that would sink most traders, if not for the fact that the magnitude of Bob’s wins are much larger than the magnitude of his losses. Bob’s average winning day is 3x the size of his average losing day, and his largest winning day was nearly 5x his largest losing day. With that, Bob has turned from a trader that struggled into one that embraced losses and found a way to be profitable. Here’s his step-by-step guide to making that transition.

Pay Attention to Emotional Intelligence

One reason Bob has been able to turn things around is because he learned some patience. His strategy now is to “buy on the test of support and sell on the test of resistance.” Or more simply, he tried to be where the buyers were buying and where the sellers were selling. 

Any trader can tell you this is much easier said than done, but for Bob it was particularly difficult because of his mindset. Bob used to beat himself up on losing days, telling himself that he would never learn how to trade.

So it’s no surprise that Bob struggled to keep his composure. Early on, he might watch prices fall on a bullish chart, and everything in him would scream, “sell.” He says he had to develop “the mental fortitude, the courage, and the confidence” in his analysis to know that when prices reached the right level buyers were going to show up.

In some ways, Bob says patience was a learned behavior: “I put my hand on the hot stove so many times that I finally decided not to do that anymore.”

But he also received good advice from a talented mentor, Anne-Marie Baiynd, who gave him a simple question to ask before any trade: “Can I wait another minute?”

“Maybe seven out of 10 times the answer is ‘Yes, I can wait another minute,’” says Bob.

The takeaway: Pausing gives you a chance to go over your trade with a clear-eyed, cold analysis. You can decide whether this is the right price level to initiate the trade.

Use the Resources Available

Bob has also made a point of using the resources available to him. In addition to working with a mentor, Bob says he is religious about watching Topstep videos as they come out.

But he also gets solid, practical pointers in his performance-coaching sessions. For instance, his coach is currently working on improving his stop management. Typically, Bob moves his stops to what he calls “break-even,” the price he bought at plus 2 ticks. However, the market sometimes comes back and takes him out. That’s not tragic, since he’s covered the commission and as he says “made enough to go to McDonald’s for lunch.” But thanks to his coach, Bob’s now recording what might have happened if he had left his stop alone. He can then use that information to evaluate his choices.

According to Bob, the big plus to Topstep’s resources is they have a resonance: “Everyone speaks with the authority of years of hard experience,” he says. “They have gone through what I am going through and are reaching back to pull me forward.”

The takeaway: Traders have to always be learning. Connect with mentors and other resources to boost your skills.