Let’s talk about SRC profits. We’ll talk about what they are, why you must have them, and how to generate them.
So let’s get started.
What are SRC Profits?
You see, here’s what I’m seeing.
I’m seeing all of these YouTube videos showing claims like this where someone said, “I made $1,088 in profits day trading.”
Or someone claiming, “I made $1,253 in profits in three minutes.”
Wow, look at this: “32,625 pounds in only 24 hours”
And you know what? I believe that all these guys actually did these trades.
But here’s the deal when you trade, you’re going to have trades that just work out perfectly. Yes, there will be trades where you make a lot of money.
And for me, the question always is, are these SRC profits?
So let’s talk about this here, because if you want to trade for a living, you must be able to generate SRC profits.
So let’s take a few minutes and talk about this.
S — Systematic
So here is what SRC profits are.
First, it’s an acronym and the S stands for systematic.
Now, I don’t know about you, but I want to make my profits in a systematic way.
Yes, of course, you can make money trading Tesla if you’re catching it at the right time.
But you see, how exactly do you decide when to enter, and can you generate these profits again?
You know me, I like to trade what I see and not what I think. I keep a special mug on my desk that reminds me of this.
See, that’s why I use indicators. That’s why I have a trading strategy.
Having a systematic way means that we have a trading strategy that tells me exactly what to trade, when to enter, and exactly when to exit.
Sometimes you exit with a profit and sometimes, you do exit with a loss. Losses are part of our business as a trader.
In short, I have a system. I love to trade based on rules and not based on my gut feeling, because whenever I traded based on what I thought, it only worked for a little bit.
When I switched to trading what I see based on science, based on probabilities, based on rules, that’s when my trading turned around.
R — Repeatable
Let’s move on and let’s talk about the second point, the 2nd letter in SRC profits.
So the second point here is repeatable. Without a system, it will be difficult to repeat the profits. Now, think about it this way.
Let’s talk about Tesla. Let’s say that you caught Tesla when they announced a stock split right here on August 11th:
And let’s say during this run you made 30% in a matter of a few days, or maybe you traded options and you made 1,000% in a few days.
Can you do it again? Well, you see, if you rely on the next stock split then you might have to wait a few years.
Think about it this way, is it better to generate $10,000 on a single trade, or is it better to know how to make $500 every single week?
For me, I’d rather trade a system that’s generating $500 per week consistently than relying on the windfall profits.
Yes, these windfall profits will happen in your trading career we’ve just talked about it. And it’s nice when it happens, but I wouldn’t rely on it.
If you can generate $500 every week times 52 weeks, that’s $26,000. For me, that is better than being able to generate these windfall profits.
This brings me to the next point.
C — Consistent Profit
The next one is consistent profit. I want to make sure that I’m getting consistent profits.
Let me give you an example here. Would you rather have an equity curve like this:
Or like this?
What is an equity curve?
An equity curve is charting your account, of how your account is going. See, both of them are making money.
So this here, you start at the bottom and you end up here:
This one, you start down the bottom and you end up here:
Now, I don’t know about you, but I wouldn’t want to be on this roller coaster. Even if this roller coaster would make me more money I wouldn’t do it.
I would rather make slightly less money but still have my hair instead of pulling it out with that equity.
I’m not a nail biter but if I had this equity curve, this roller coaster, I would probably bite off all my nails. You know that there’s some traders who are doing exactly this.
Now that you know what SRC profits are and why you need them if you want to trade for a living, let’s move on and let’s talk about how you generate these profits.
3 Things You Need To Generate SRC Profits — Number 1
So the first thing that you need is that you need to have a trading strategy or trading strategies.
The strategies that I use are based on indicators and probabilities.
You see, I know exactly what to trade, I know exactly when to enter, I know exactly when to exit. I know my risk, I know my potential profit, and I know my odds of realizing that profit or loss.
If you don’t know my trading strategies yet, let me briefly mention them to you.
So my bread and butter strategy is the PowerX Strategy, and I have written a book about this.
During the pandemic I was trading a strategy called Theta Kings. This was perfect as the markets were crashing, along with the PowerX Strategy.
Now, another trading strategy that I’m trading here right now is a trading strategy called The Wheel. Anyhow, let’s move on.
2. To generate SRC profits you need to have tools
What is the second thing that you need to generate these SRC profits? Well, I am using tools that make my life easier.
You see, I know my odds. I know my probabilities, I know what to expect and I couldn’t do all these calculations in my head.
This is why I’m using tools like the PowerX Optimizer that helps me to find the best stocks and options to trade.
So here is the PowerX Optimizer.
It shows me for any given stock the signal, the position size, how much I should trade, how much money I can potentially make, and how long I’m in a trade.
All of this is important to me so this is why I love to have tools.
And for The Wheel strategy, for example, I use the wheel income calculator. Let me show this to you.
So this is my income calculator that I’m using for picking the best stocks and options for The Wheel.
You see, I need to make sure that I’m getting the very best trades for my trading. I personally would never trade without the right tools. It’s like trying to compete in a Formula One race with a Toyota Prius.
I mean, nothing against a Prius, but you won’t win a Formula One race with it. And when trading your trading against some of the smartest minds in the world. Don’t bring a knife to a gunfight, have the right tools.
3. You need to have the right mindset
So finally, number three, what is the third thing that you need here? It is the right mindset.
What do I mean by this? You see, when trading there will be losses and you need to know how to limit your loss because otherwise these losses will be devastating.
Who knows what I’m talking about? You see, you need to know how to control your risk. Take care of your losses. The winners, they can take care of themselves.
Now, here’s something to remember that is super, super important. Trading is a marathon, not a sprint.
So super important and here’s why.
Good for you if you made a $1,088 in profits in day trading, or if you made $1,253 profits in three minutes. And you know what? Good for you if you made $32,625 during the coronavirus in 24 hours.
But let me ask you this, how much money did you lose before that? How much money did you lose right after you made these profits? Did you give it right back?
You see, I see too many traders being blinded by these windfall profits, by these, “Hey, look at me. Look at what I did” stories and they don’t see the full story.
This is why I’m doing this here to show you the full story.
When traders don’t see this full story, when they just see this “look at me” stuff, they start chasing these dreams and they lose a lot of money along the way.
You see, for me personally, I prefer SRC profits. Trading is a marathon, not a sprint.
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Trading Futures, options on futures and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. The lower the day trade margin, the higher the leverage and riskier the trade. Leverage can work for you as well as against you; it magnifies gains as well as losses. Past performance is not necessarily indicative of future results.