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Thursday, April 5, 2007Posts in the [Journey of Conrad Lim] series:
If you like this, just buy me cup of coffee. Thank you!From Chapter 1 - Secrets Of Millionaire Investors
Investing: The Answer to My Financial Freedom?
That was until I did a video project about online investing and trading with Options. The idea of being an investor grabbed my imagination. I spoke to my wife, Lucy, about it. I showed her the material I was working on and how easy and affordable it could be to become a full time trader. The promise of becoming a millionaire and improving the life of our family and our future generations, the dream of having a financially free lifestyle and the simplistic approach to the method was just too good to resist.
Experiencing Initial Failure…
‘You always pass failure on the way to success.’ - Mickey Rooney
After attending our first trading workshop in an intensive, mind-crunching four days, Lucy and I quickly funded our first account with US$5,000 and began trading. As luck would have it, profits came fast and easy and our account grew by 20% in our first week of trading. We then hit our first few losses and told ourselves that this was normal in trading.
The losses accumulated and still we lived in denial. Ignorance became a reality check when we wiped out almost all of our capital and whatever profits we had made. So we re-funded our account with another US$5,000 and tried again. I attended several more trading workshops and picked up more strategies. Still, the losses kept mounting. We couldn’t figure out why, after paying so much for these workshops and working so hard to stick to the rules, we were still losing money. I began to wonder if the claims of making money from investing were nothing but a big pipe dream.
Our savings were running thin, my media work was getting affected and the workflow had slowed to accommodate my trading workshops and trading at night. My health took a dip because of the late trading hours. My marriage was strained and my family was getting affected by my mood swings and short-tempered flares. This was not how I dreamt it would be. Things had taken a turn for the worse and the dream was becoming a nightmare.
Learning From Mistakes & Changing My Strategy
‘Good Judgment Comes From Experience, And Experience Comes From Bad Judgment’ - Barry LePatner
After four months and over US$10,000 in losses, I stopped trading and took some time away from the market. A friend suggested that I read Alexander Elder’s books “Trading for a Living” and “Come Into My Trading Room”. That led me to pick up more books on investing and trading.
After reading these books and learning the true ins and outs of investing, I finally realized why I was losing money. It was not that making consistent profits from the stock market was not possible. It was that the investing workshops I had attended had not adequately equipped us with the essential basics that were so necessary to an investor’s success. The workshops did not teach us how to thoroughly analyze a company’s profitability and financial stability (known as fundamental analysis) as well as the essentials of understanding market psychology towards a stock (known as technical analysis).
Basically, the workshops run by many of these self-professed gurus gave just enough information for you to get all excited and kill yourself in the market. A little bit of knowledge can kill. How on earth did I expect to pick up something in four days and believe that it would be so easy to accomplish something that others have taken years to build?
Getting Back to Investing Basics & Doing Whatever It Takes to Succeed
So I decided that I would do whatever it took to master the art of investing. I would first build a solid foundation by learning everything that needed to be learnt about investing in the stock market. I formally retired from the media business knowing that I could only achieve my goal if it was a “must” (something Adam taught me). There was no turning back and failure was not an option anymore.
I hit the libraries, bookstores and Internet to suck out as much information as I could gather. I studied the finer points of Technical Analysis, Pattern Trading, Momentum Trading, Sector Investing and even Japanese Candlestick Analysis. I got to know and modeled some real traders who gave valuable insights into the world of online trading. I started working out and running again and got my physical fitness back. With that, I got my self-esteem back up on the high.
US$50 a Day…Small But Consistent Profits
After three months of hard work and self-study, I was able to formulate a simple and affordable trading strategy which allowed me to consistently earn US$50 on single Options for every trade in less than five days. Soon enough, I was averaging US$300 a week with success in five out of every six trades. This first strategy that I had developed is known as the 5-Day Pre-Earnings Game and you can read about it at http://www.wealthacademyinvestor.com/. This small but initial success gave me the confidence and motivation to learn even more and to work even harder. I began to learn and test more advanced strategies such as ‘Sector Rotation’, ‘Intra-Day Scalping’ and ‘Momentum Trading’.
Making US$5,000- US$7,000 of Consistent Profits a Month
‘It takes a long time to bring excellence to maturity.’ - Publilius Syrus (~100 B.C.)
After more than a year of extremely hard work, I began consistently earning between US$5,000- US$7,000 a month in trading profits. And my earnings keep increasing as time goes by and my experience builds. In fact, I made US$7,000 within the first six trading days of the year (2007). By the end of the month (January), I took back a total of US$15,000 in profits. I post all my trades (both wins and losses) on my blog and website. You can view them at www.wealthacademyinvestor.com.
After being a bankrupt for more than five years (since 2001), I finally made enough money to pay off all my debts and applied to my official assignee to be discharged from bankruptcy. That moment was one of the sweetest memories in my mind.
When news of my investment skills spread within the investing circles, other traders (both amateurs and professionals alike) urged me to teach them everything I knew. They were willing to pay me “kopi lui” (coffee money) to make it worth my effort. So every Saturday, I would conduct what became known as ‘The Pattern Trader Tutorial’ where seven students would be cramped in a small room in my three-room HDB flat. I am proud to say that many of them have gone on to experience a lot of success and have shown their appreciation by continuously recommending more students to me.
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