Thursday, May 24, 2018

Baptism of Fire



There was this certain gentleman who messaged me one sunny afternoon. Let's call him John. 



The man started investing in the second half of 2009 when the stock market was starting to recover. It was the best time to invest. John was a fundamentalist and a farmer by profession and understood the concept of the seasons. He was taught that farming and investing are very much alike - That just like farming, it takes time before you can reap your harvest. It was the best time to buy long-term investments.



 Several years later, he was able to grow his investments from 6 to 8 figures. Now that's a lot of zeroes! But as he continued with his story, John said he was lost on his investments and needed help. He explained that in the past 5 years, his investments stopped growing and even eroded chunks of his profits. 

All these years he was loyal to his stocks, which has now become a big fund, and was rewarded handsomely. But this time, his loyalty was being tested.

John confessed to lightening his positions in the first quarter of 2018 to buy his new set of "investment winners." A few months later, he found himself in a slump - His fund almost halved.

"-40% na ako sir. Ano gagawin ko sir Zee?"

It was his first time to experience such a terrible thing in such a short amount of time. And to make matters worse, he took a substantial loan to add to the losing position. What happened? What was the cause?

As I started to probe, It seemed that John discovered Facebook Trading Groups like how Magellan "discovered" the Philippines.

And the rest was history.


This was the exact moment John knew, he f****d up.

He thought he was a fundamentalist. But he wasn't. He thought he was because he got lucky. He was a speculator but didn't realize it. Because a true fundamentalist wouldn't be fazed by bear markets.


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Many traders who start out are like John. I was also like John. A few jackpot trades and we think we can trade for a living - until the season for bears come.





For those of you who seek the truth, here it is:

The market rewards us for the discipline in our trading system, not the loyalty to our stocks.

If you consider trading for a living, then you should ask yourself during a bear market when things are in chaos and the atmosphere is filled with fear. Not during times when the fields are green. If you can confidently tell yourself that you'll be alright with utmost certainty, then 

You 

Are 

Ready.

This is the ultimate "litmust" test. This is every full-time trader's Baptism of Fire.

 Because if you have the ability and the belief that you can build even in the harshest environments, then you will definitely thrive when the good times come.




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It's a bear market. Are you ready to go full time?






15 comments:

  1. Thanks for another juicy episode of your blog boss Zee

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  2. What platform are you using? Thank you Boss ZF! Great content as always!

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  3. I'm not ready. I thought I was. There were times that I consistently follow my Trading plan in a week, only to be wiped out in 1 or two days because of stupidity. I hope I can master trading psychology.

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  4. Timely reminder sir, salamat.

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  5. The bear market pushed me so hard to learn from all the mistakes that i had from these past few months. It strengthened my realization to strictly discipline myself when it comes to organizing my trading system, plan and journal. I am so thankful with Zeefreaks. Though your posts, I am constantly reminded on why I am doing this in the first place . . . #GrowthInGiving

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  6. Thank you for sharing. I hope many will read and share this story. I am a housewife and I am dedicating my personal time to learn how to invest, read and analyze countless charts and building up my capital. I may not be a full time trader. But my dream for financial security for my children. I have the desire to learn and be a trader in many years and charts to come. I really wish my 2:00am (8am PH Time)wakeup call every weekdays will pay off in the future!

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  7. This bear market build my confidence; bec of zft. I remember a few years back then, pag bear market nanonood lang ako;I've realized wala ako natutunan by evading the market. Now, with proper risk management, I can say that I have small gain, with capital preservation at this market condition, napakahirap. But this is the path we've chosen, it's either you trade with caution or not trade at all (Ms. Market really is a great teacher). Salamat boss and to zft. Thank you for encouraging traders like us to get out of our comfort zone. (Btw, farmer din ako)

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  8. The cycle of strong/weak men and hard/good times really says it all. I am thankful to experienced bear market while studying trading discipline thru your blogs and zf tribe. Kudos

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  9. Thanks boss Zee... worth the wait.... been trying to trade this season on paper, it is a tough season but the learning curve is very substantial trying different set-ups compared last year where everything is going up. looking forward for your next entry... Continue to be a blessing...
    -dgreatone

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  10. Thank you for the reminder boss Zee. I've been wanting to message you for quite a long time already but everytime I try, parang natatakot ako na ewan haha. Good thing there's this blog of yours boss Zee. I always turn to this blog (and other zft blog/contents) since I'm too scared to ask personally, only to find myself amazed because it felt like the message is directed towards me.

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  11. Those who are in the market thinking it will be a quick buck will give up while a few will take this opportunity to learn from mistakes and grow. I nearly quitted last month since I saw my port plummet -30% but then i remembered I like trading. I'm taking this time to reading your and others blogs, build my trading system and testing it. Hopefully it will pay off. :)

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  12. -50% na nawala sakin...
    but since that day nag umpisa ako mg trade ths year alam ko mahirap kya dahan dahan akong nag hanap ng mga way to improve my skills in trading...boss ZFT blog helps me alot.. d ko pa na bawi ang -50% but i know to my self ang laki ng pinagbago ng desiplina ko sa trading ng mabasa ko itong blog na to at mapasama sa MGPh fb group.. stalker lng ako ng group hindi ako official tribe member heheh..

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  13. Thanks dito sir. I also lost -50% of my capital. Good thing I stumbled on this blog of yours sir. I am picking up the breadcrumbs you scattered and hopefully will be where you are someday. Continue to inspire us sir. Kudos. God bless.

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