The Fastest Way to Get Good at Trading - 146
Today we are going to be talking about and answering a question that we get asked a lot and option genius, which is what is the fastest way to get good at trading? Because, well, let's face it, everybody wants to get rich quick, right? Now, passive trading is a great way to get there consistently, and to be profitable pretty quickly. But to get really, really good at it, it does take time. So in today's video, and yes, I said video, I'm gonna explain that in a second. In today's video, we're going to be talking about four different methods that you can use to speed that up some of these would people you already know in order to use, and I'm gonna talk about a fifth method that can really turbocharge the process that most people don't. So first of all, I gotta say, Hey, why did he say video? Well, if you're listening on the podcast, I am making this also as a video, and it's going to be on the Option Genius YouTube channel. So if you like to watch videos, and you want to learn about trading options, hop on over to our YouTube channel. And please subscribe and like and post a comment or two, because it really helps and we're trying to boost up our YouTube channel. Now, if you are listening on the podcast, no worries, because I am going to be drawing on my screen on my whiteboard a little bit on the on the screen, but I will walk you through it, so don't feel like that you have to say you're missing out on anything. Okay, so let's get to work. So for this example, I want to come up with some guidelines. Because we need to codify this right? So we're going to say that our hypothetical trader, maybe it's you wants to get good at trading as fast as possible. And he's like, Oh, how do I do this? Okay, well, first of all, I tell you, step one is to pick a strategy, that's always going to be step one, right, you got to pick a strategy that works for you that you understand, and you want to get good at. Step two is find a trading plan that is really good, that actually works that's consistent that you find probably from somebody who's already doing it, and doing it well and having success with it. So you know that the plan works. And then number three, is putting in the reps is just doing the thing over and over and over again. And that's where we're gonna talk about today and how to really speed up that process. Because wanting to pretty pretty fast, right? I like this strategy. Okay. And then I got this plan. Here you go. Here's the plan. Thank you. I got it. All right, now let's implement, and let's learn how to do it. So that's the process that takes the longest. And for some people, it takes years and years and years to never master it. Some people, they get good at it really quick. I want you to be getting good at it really quick. And so we're going to be talking about how to do that today. All right. So for this example, we're going to say that a trader is looking to learn how to do credit spreads, okay? Because most people when they start, they're like, hey, you know, I like the credit spread. Makes sense. I want to do it. A lot of people tell us they want to learn credit spreads first. So let's say we're going to be talking about credit spreads in this example. Okay. And now let's say, for the credit spreads that we're going to do, we're going to be using $1,000 in each trade. Okay, so we got $1,000 per trade. And so that is the amount that it takes to do one trade, right? So then, what do we do? Well, we got to start putting in the reps. We got to start working, because they're doing the thing. Okay, so I'm going to draw some lines here. Okay. Now, we have a trader that has, let's say, $5,000. Okay. So he's got $5,000. He's got a small account, he's looking looking to do well, right. He's looking to get good at it. Now. For $5,000. If you have $1,000 per trade, how many can you do in a month? Right? How many trades can you do in a month? Well, obviously, you can only do five trades. How about in a year? Well, if you do five trades times 12, you can do 60 trades, right? And then how about in 10 years? Well, in 10 years, you got 600 trades. All right. I apologize for my writing. I'm not. I'm not used to writing with my mouth. So you have a trader with a small account, and he's doing $1,000 per trade. He's doing five trades a month, and we're only talking about monthly, okay? We're not gonna talk about weeklies here. So, in a year, he's put on 60 trades, which is a decent amount of trades, that's a lot of trades. And then in 10 years, he's got 600. So he's got 600 reps under his belt. Now, obviously, you don't want to take him 10 years to get good at something. So we're gonna have to speed that up, right? So what if you think oh, well, what if I have a lot more money? Maybe, maybe I can, I can do that. So what if trader number two has 50k in his account, you have 50,000. So yeah, 10 times as much money. Right? So now we're looking at that and we're saying, oh, okay, well, I can do 50 trades a month. No, not really. You really don't want to be doing 50 trades a month okay, that's gonna be, especially with the real money is just, you're gonna be all over the place, it's gonna be hard to find it's gonna be a full time job, if you can do that. So, realistically, now I would spreads I like to go eight to 10. More than that, I feel like I start missing out on things, I started missing the news and some events, I started not being able to follow everything. And so I'm going to limit it and say, you know, maximum we can do even with 50k is 10 trades in a month. All right, so now in a year, you got 120 trades. So that's twice as much experience twice as many reps as trader A the first guy, right? And then after 10 years, you got 1200 trades, 1200 reps under your belt. Now that's, that's a pretty good amount. But that takes, again, 10 years to get there. So what do we do? How do we even speed this process a little bit faster? Well, you can do something that a lot of people poopoo at, but it really helps. And it's called paper trading, or virtual trading. So write your paper here. Now, with paper trading, you can do a lot more trades, right? So instead of 10 trades, you don't have any limits. So maybe you do 25 trades. Now, could you do 25 trades with the 50k? Yeah, you could, but then it's with real money. And I'm assuming you're just starting, right? So I don't want you to get ahead of yourself and lose a lot of money really quickly. I'd rather get your reps when there's nothing on risk when there's nothing on the line. So we're going to do paper trading, we do 25 trades, you can even do 30 trades, maybe even 50 trades if you're really crazy. But I would say probably 25 trades. And so in a year, 25 times 12. What is that? We're looking at 300 trades, that's 300 reps in a year. That's a lot of trades, okay? And then in 10 years, you got 3000. Now, why do I have three or 10 years here? Because it does take 10 years for you to go through all the different market cycles. Okay, that's why it's really important. Because you can't just do good one year and say, Oh, hey, I'm an awesome trader. No, I'm sorry, you haven't seen everything. You know, in 10 years, you've seen probably a bull market, you've probably seen a bear market, you've seen several corrections, you've seen sideways markets. So you've seen a little bit of everything. Okay, in one year, you really haven't seen anything. It might have been a bad year, it might have been a good year might have been sideways, you know, it might have been volatile or low volatility. So you want to be able to trade in every single market environment, you're not going to get really, really good, unless you've traded for about 10 years to see all the different market hookups, right, you want to know what to do in a bull market, you want to know what to do in a bear market, sideways market correction quick up and down moves in the market, you want to know how to do that, you won't get that experience unless you've traded for 10 years, or unless you take option number four, right? So option number four, I'm going to call it back testing, B, A, C K. Now this is probably the fastest way to get really, really good. Okay? It's not real money, obviously. But you can in your mind, simulate it and you can get experience super, super, super, super quickly. So let's say, you know, over here, you're limited by time the 5k guy, he'd only do five trades a month 50k guy does 10 trades to paper trade guy in a month, you can do 25 trades, because he has to trade it and he has to wait every single day, right? You put on a trade today or you put on 10 trades today, you got to wait till tomorrow, then the day after then then after then the day after. And you gotta wait for them to finish with back testing. You don't have to wait as long. So I'll give you example, I looked at a strategy on how to trade a two week strategy. So it was a two week strategy in a specific instrument. It was the SPX. And I came up with the plan. Somebody shared it with me. I'm like, Oh, that's great. I want to go back test this. So when you back test something, and if you're going to really work it and put real money on it. I want to know how this is going to work over the last several years, not just one or two years. I'm going to go back like 10 years. Now this one because it was the way it was set up, we can only go back for six years. So I went from 2016 started there and ended at the end of 2022. So I went for six years of trading. Now this was a two week strategy. So there were 25 trades in every single year. Right? How long do you think it took me to do all those trades? It took me four hours. took me four hours. First to do 25 times six, that's 150 trades. So I got 150 reps. Now even if it was a monthly trade, that's fine, right, I would have more reps than paper or money or low money. So that I would have more reps doing that than any other way of, of trading. Because that is the name of the game, putting in the reps, right? When you are catching the ball, you just you just gotta catch the ball. When you're throwing a pitch, you know, you get good at aim by just throwing it over and over and over. And again, and you really do that in just about anythi
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