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Money Makes Money
The document discusses strategies for making money through trading and investing. It compares the returns of different trading strategies, including a beginner's strategy of closing trades at 20% gains or losses, George Soros' strategy of letting winners run and cutting losses at 10%, and Stanley Druckenmiller's strategy of sizing into positions properly based on conviction. It advocates managing risks and letting profits run. Overall it promotes learning to trade options and stocks to generate income in both bull and bear markets.
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Money Makes Money
- 1. Money Works Hard for Me EveryProfessional’s Options to Lifestyle, Freedom and $ucce$$
- 2. I was working hardfor money Stuck inTraffic, 3 Work & Meetings, 10 Meals, 1.5 FamilyTime, 1 FreeTime, 1 Trading, 1.5 Sleep, 6
- 3. Stuck in KL peakhour jam. Everyday.
- 4. Today, money works hard forme Stuck inTraffic, 1 Work & Meetings, 0 Meals, 3 FamilyTime, 6 FreeTime, 4.5 Trading, 1.5 Sleep, 8
- 5. Now I getto have breakfast with my young son during peak hours. That’s the value of PERSONAL OPTIONS!!
- 6. Starting Capital $100,000 Each trade $10,000 Original StrategyBeginner's Strategy Say we trade 10 trades for a total $100,000 investment. For this second strategy, say you always close a trade when you reach 20% gain. You figure you should not be greedy.
- 7. Starting Capital $100,000 Each trade $10,000 Original Strategy ReturnValue 38% $13,800 4% $10,400 -41% $5,900 32% $13,200 -83% $1,700 -17% $8,300 -4% $9,600 -50% $5,000 0% $10,000 122% $22,200 Ending Balance $100,100 ROI 0.1% Success rate 40.0% Beginner's Strategy Return Value 20% $12,000 4% $10,400 -41% $5,900 20% $12,000 -83% $1,700 -17% $8,300 -4% $9,600 -50% $5,000 0% $10,000 20% $12,000 Ending Balance $86,900 ROI -13.1% Success rate 40.0%
- 8. Now you aredown almost 13% for the year You didn’t manage your risks!
- 9. Risk comes fromnot knowing what you are doing Warren Buffet
- 10. Okay. Now let’sfollow Soros’ strategy: Let your winners run and cut your losses at 10% Here’s what your portfolio looks like:
- 11. Return Value 38% $13,800 4%$10,400 -41% $5,900 32% $13,200 -83% $1,700 -17% $8,300 -4% $9,600 -50% $5,000 0% $10,000 122% $22,200 Ending Balance $100,100 ROI 0.1% Success rate 40.0% Soros’ Strategy Return Value 38% $13,800 4% $10,400 -10% $9,000 29% $12,900 -10% $9,000 -10% $9,000 -5% $9,500 -10% $9,000 0% $10,000 122% $22,200 Ending Balance $114,800 ROI 14.8% Success rate 40.0% Original Strategy StartingCapital $100,000 … Each trade $10,000 Beginner's Strategy Return Value 20% $12,000 4% $10,400 -41% $5,900 20% $12,000 -83% $1,700 -17% $8,300 -4% $9,600 -50% $5,000 0% $10,000 20% $12,000 Ending Balance $86,900 ROI -13.1% Success rate 40.0%
- 12. By managing yourrisks likeSoros, you are up nearly 15% pa. Your success rate is still only 40%... Meaning you’re not even half right!
- 13. If you wanta monthly income, just repeat this trading plan every month
- 14. Retirement Plan Capital $ ROI p.week ROI p.month ROI p.annum Balance compoundedafter 1 year 2 years 3 years 3,000 1.5% 5.8% 96.7% $5,901 $11,609 $22,835 10,000 1.5% 5.8% 96.7% $19,671 $38,695 $76,117 50,000 1.5% 5.8% 96.7% $98,355 $193,476 $380,587 Power of Compounding (Based on monthly ROI)
- 15. Learn how topay only 2% to 5% of stock price It’s like how property investors pay only the house deposit instead of paying cash in full and make higher ROI on property sales.
- 16. Protect & Profit withPowerful Options Useful for all market directions
- 17. Bull Market 8/7/2014 S to c k v s O p t i o n s Stocks ROI 1.3%
- 18. Bear Market 8/7/2014 S to c k v s O p t i o n s Stocks ROI 22.7% (Capital 20%)
- 19. Options trading gives youopportunities in all market trends
- 20. Breakout Sideway down SidewayupDowntrendUptrend Rental
- 21. THE most important lessons that Stan Druckenmiller learnedfrom GeorgeSoros “I’ve learned many things from him, but perhaps the most significant is that it’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.The few times that Soros has ever criticized me was when I was really right on a market and didn’t maximize the opportunity. Soros has taught me that when you have tremendous conviction on a trade, you have to go for the jugular. It takes courage to be a pig. It takes courage to ride a profit with huge leverage. As far as Soros is concerned, when you’re right on something, you can’t own enough”.
- 22. Stanley Druckenmiller, who traded under Soros, wasthe genius behind this idea. 1. Size matters. 2. Earn the “right” to trade Big first 3. ProperTiming is Everything when you Trade Big 4. Have a contingency plan
- 23. 3SimpleSteps Screen Select Timing Stop Losses I’m goingto show you 3 simple strategies
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