Near the beginning of the video T.S. mentioned that the short seller is responsible for paying out the dividend if you're shorting a dividend stock. This was an added cost that I had no idea existed. Weighing in the price of fees and other trading related costs is something that must be considered as it may add a lot of slippage to your profits.
T.S. again mentioned that it is okay to have a loss. But it isn't okay to let those losses grow, doubling down, and failing to cut losses... I'm still guilty of the not cutting losses.
T.S. also mentioned that it is easier to short stocks in the afternoon due to price action fading and patterns cracking mid-day.
There are 3 types of shorts that T.S. likes to do
- Into a morning panic if held from the night before, usually because the pattern has cracked and still shows weakness
- After the morning panic bounce
- Afternoon fades
The term Boom and Bust pattern was introduced and explained as a big run up followed by a big crash. This would cover supernovas that top and crash in a very short period of time.
T.S. suggested that anytime you are learning something new on trading that you should always start out trading small. Work your way into the bigger trades.
You should always be analyzing your trades. I'm doing this through the blog, twitter, profit.ly
T.S. talked about the risks behind shorting non-pennies and that they are more risky because you are dealing with real companies with real profits and real products. It isn't likely that you will see large drops because the overall market is bullish and wants real companies to succeed.
Never let your losses kill your account or your confidence.
It was good to hear T.G. because he's one hell of a good trader and he's very open about his good trades and bad trades. It takes a lot of guts to put out your major losses, especially when they may be larger than the average American's yearly salary.
T.G. talked about his thoughts on risk reward and said it basically equals what is the chart saying, how much is he willing to lose.
He also explained that while "going for a ride" on a stock can lead to larger gains it can also lead to huge losses and the funds you have in the trade are not liquid and available for other trades that may be better opportunities.
T.G. then went into tracking promoters and how he likes to get into a pump early for the ride up. I'm not as comfortable with this strategy so I didn't take a ton of notes on this portion of the video.
A few key parts however was the need to be detailed with promoters because the misspelling of one letter can take you to a different promoter's website, etc. You can check the URL on the page as well as the disclaimers, I'm certain a WHOIS search could be helpful as well.
T.G. has set up a dump email that the promoter's are connected to. Basically he uses the dump email address when signing up for promoter lists. He then will scan the emails and see if multiple sites are emailing the same thing/promotion. Knowing which of the sites will email first will help with quicker entry times.
It was interesting and T.G. does a great job on his webinars, but the early promotion thing is a little too risky for me. I like the idea of shorting them because as T.S. has mentioned prior, you know the end game and that puts the odds more in your favor.
Stay tuned for the overview of video 9. I'm almost done with as well.
Follow me on twitter