Transcription
So, I want to go over, you know, the mindset required to be a good trader. So many traders, they're struggling with simply their own worst enemies, whether it's going on tilts and overtrading, oversizing, a combination of both. Their first trade, they start out super heavy, they take a loss. The second trade, they downsize a lot because now they're super nervous and fearful. It ends up being a solid trade. Uh, they're still heavy red on the day because they oversized on the first trade. Therefore, they end up trading even more and taking larger losses going forward. Uh, it's a full emotional tilt type of day, right? And that's where a lot of traders will start to struggle.
Um, the people that group hop, they will jump from mentor to mentor to mentor to mentor or signal guy to signal guy just trying to make money. Basically, the the main thing where all this stems from is someone who shows up and they say, "I want to make a lot of money." Instead of showing up and saying, "I'm here to trade my system." I, me, James, I show up every single day and I trade my system. Most of the time it works. 2025, the proven success rate was 93%. But most of the time it works. But there is, there's that 7% that it doesn't work. It doesn't work. And there's nothing I can do about that. I'm not a fortune teller. I'm not perfect. I can't show up every single day, and every single trade I take for my entire life, I may be able to anticipate the US stock market perfectly. All right? It's just not realistic.
So, I have to tell myself, all right, when I show up, what's my game plan? That's where everything starts as a trader. That's the difference from a trader and a gambler. The trader has a game plan. The gambler is like, "I'm here to make some money. I just want to show up, make money, and that's it." Right? What happens when you don't make money? You accomplished nothing. You accomplished nothing. You will not grow. This person doesn't grow. All right, the day trader who shows up and says, "I'm here to trade my system." Even if I end that day as a loss, I still grew as a trader because pain retains, right? Failure, you learn a lot from failure. I'm going to journal what I did right, what I did wrong. As long as I followed my system, this person grew. I improved that day. 1% better, right? That's the goal.
Because we all know as traders, you're not making money in the beginning. You, if you join, yeah, you join like you copy my trades, you copy someone else's trades. Yes, you can make some money, but odds are is in the meantime, somewhere along the way, your own emotions are going to get in the way. You're going to start to butcher things up and that's where the experience comes into play. The time comes into play because a trader that's been trading their system for one, two, three plus years, they know what they're doing, right? They're somewhat successful at what they're doing. They might not be making a million dollars plus a year, but they're successful enough to where they know what they're doing. They're more than likely going to make money when they show up, right? So, that's where you want to get to. You're not going to get there by full-porting your account. You're not going to get there by taking a tiny scalp for 10 points profit while this trade runs for 80 points and just going, "Ah, shucks. I'll come back and I'll get it tomorrow." Same thing. Next day shows up, boom, you take 10 points again because you're nervous. "Ah, shucks, I'll get it again tomorrow." It's not how it works, okay?
You need a real system in place that allows you to capture maximum ROI on your trades while keeping your risk very, very minimal. That's why the majority of the trades I take, the majority of the trades I go after, I'm leaving unlimited room for growth. I, I can realize a 400-point trade on NQ or 400% on QQQ. I've done it live in front of people many times. All while having a 15-point or a 15% stop-loss. Okay? It just heavily increases my wins while really reducing my losses, keeping my losses tight. And that's truly, in my opinion, it's the best way to become a successful trader in the long run is by establishing a good system that works for you. I'm not saying you got to do mine. That's not what I'm saying at all. I'm just saying finding a system that works for you in the long run.
Things to avoid are going to be jumping between 7, 7,842 different mentors, right? Stick with someone that makes sense for you, someone that you know is a good trader. You've seen them. The key here, ignore anything they post. You've seen them trade live every single day. That's how you know if they're a good trader. They need to have traded live in front of you, I would say, for more than three months in a row. After three months, you can determine if it's legitimate or not. But three months in a row of seeing the same strategies be exercised and be successful and they work and they make sense. All right. Then once you found, and that also applies to you, right? You want that to apply on your end as well. And you start to see that work for you. Now, that does mean following the system. You all it takes is going on tilt one day and you can wipe out a month's worth of profits, unfortunately. But that's what most of us have done with day trading. Um, but when you followed that system yourself and you start to see it work and then the light bulb starts to turn on, "Oh wow, okay, if I just don't go absolutely crazy and go full tilt and risk my entire profits for the week just because it's a Friday and I'm feeling confident because it's my sister's birthday and I want to yolo this." No, no.
Managing emotions is key when it comes to day trading. I don't care if it's Monday. I don't care if it's Friday. I don't care if every single day I started out with a loss. The next trade is its own trade. I've already showed up. I've planned my risk. I backplanned my risk. Something really good we learned in the Marine Corps is backplanning and preparing for the worst. I always want to prepare for the worst and hope for the best. I do not, I do not want to sit there and go, "There's no way I take a loss." That's just not the case. I need to be prepped for the loss. When I enter a trade, "Hey, I got a $300 stop loss. I got a $600 take profit." That's my game plan. 2:1 risk-reward ratio. Boom. Execute. Now, I know when I enter that trade, I know exactly what I'm risking, and I know what I'm going to make. I have an exit strategy as well. Right now, you might not have an exact defined exit strategy, but there needs to be a risk strategy in place. You need to have some type of stop-loss in place to protect your downside, not only financially, but also mentally. Mentally, if you let a trade just destroy you and go to zero, it's going to put you in a bad spot.
I've seen many traders go, "Ah, I took a loss today. I got destroyed. I got destroyed." It should not be your terminology. You need to change your terminology to be a lot more optimistic and positive. Why are you saying you got destroyed? Did you simply get stopped out? Then you got stopped out. You didn't get destroyed. Getting destroyed means you broke the rules. You went in too heavy. You let the stop loss go. So now you took a 50% hit. Let's say when you were trying to only take a 20% stop-loss and you took that on double the position size you planned on trading with, then yeah, yeah, you got destroyed. It's a learning lesson. We need to journal that. We need to see what we did wrong, what we did right, and we need to move on from there. We cannot dwell on these things, guys. I'm telling you, pain retains. Things that hurt, that's what you're going to remember the most. And you need to use that as your fuel to say, "What did I do wrong here? Okay, I oversized. Okay, I overtraded. All right, I didn't enter at my plan execution. Okay, I didn't realize my actual stop loss. I moved my stop loss down." And then we start to see, "Hey, we didn't do anything right here. Literally, I did nothing right." Boom. Now it makes sense why this trade didn't work. I did five out of five things wrong. Okay. Well, the next day, I cleared my head. I walked away that day. The next day, I showed up and I got a winning trade. What did I do right the next day? Well, I downsized back to my original risk parameters. I had my stop loss in place. I entered when I planned on entering and that was a winning trade. Hey, well, what's the reason this trade worked out then? Well, maybe because I followed my risk. I followed my plan out the gate. I did five out of five things right. Well, there we go. Now, I just need to do that. Every single day I show up.
I'm not exaggerating. Every single day you show up to this computer and you say, "I'm going to trade the US stock market." You should have a predefined game plan that you are going to follow, no matter what. No matter what. I don't show up and go, "Well, I told myself I'm only willing to risk $2,000, but you know what? Forget it. I'm gonna go ahead and risk 6,000 instead today. I'm just feeling good because it's a Friday." No. Makes no sense. Traders like that do not succeed. All right.
So, when it comes down to this mindset of what you need to succeed, one, you need that long-term vision. You need a long-term vision. If you're going to show up to day trading and you're like, "Hey, I'm going to be making seven figures within a year." You are, I'm just trying to be respectful here, but honest. You're delusional. You are absolutely delusional. It's just not realistic whatsoever. Compare it to someone who goes to college, gets a job. Think about people who earn seven figures. Let's think of doctors, right? The higher-end doctors. Think about how long it takes them to get there. You're talking 10 plus years of dedication for them to get to that point to where they're starting out at 400 grand, getting up to seven figures annual income. What makes you think you can show up and trade some of the highest volatility markets out there and where majority of people fail, what makes you think you can be successful within that first year? The odds are low. The odds are low. And I will say every successful day trader I know, they've stuck it out through those first, what I've, what I've seen on average is the first three years are the struggle. That's what I've seen on average, the first three years. Now, there are some good ones that get it faster, but there are some people that take seven years, right, to to get good at this. But that acceleration curve is what you're looking for because a lot of day traders, they will spend three years and let's say in those three years they'll lose, you know, 40 grand in three years. It's like that first year they're profitable, they make 120 grand. And you're like, "Huh? Well, not only have I recovered the losses, but I'm net up 80k now." And then it just, it really does look like that. That's what the acceleration curve looks like for day traders, for most day traders. I'm not trying to promise anything unrealistic here, but what I've seen for the most part, it's like, "Oh, I only made 80 grand. Oh my god, the next year I made 400k. Oh my god, the next year I made 1.5 million." And it's like, yeah, now that we're on the pretty side of it in hindsight, now we can see, hey, it was pretty realistic to stick that out. But that's where the hard part is. This negative 40k where most people go, "It's not for me. I'm out. This is stupid or it's fake or it's a scam," or whatever they want to say to make themselves feel better about quitting, right? But just like anything else, quitting, all it does is guarantee failure. The whole point is is to not get to a point where you're forced to quit, right? We don't want to be blowing so much money, trading irresponsibly, right? Pretending like money is infinite to the point where now we have to quit because there's nothing left, right?
And that's the whole beauty of prop firms, okay? It's the entire beauty of prop firms. I'll put the links below for prop firms that I like and I work with. Obviously, they support the channel, but you should be trading with prop firms if you are basically not profitable because what it's going to do is significantly lower your risk and it's going to remove that financial strain you have in your mind of like, "Oh my gosh, this options trade I might lose 400 bucks, I might lose 500 bucks per trade." Like, pretty realistic, honestly. Um, and instead be like, "Okay, how about I just spend like 20 bucks or a hundred bucks on this prop firm account and now I can use this as my true trading where I can probably get four to five trades out of this and I have the ability to be paid out a couple of grand, uh, as opposed to risking my own money and now I play with a whole separate set of mind games." All right.
You're starting to see a lot more traders become successful and they're starting to become successful much faster and make a lot more money much quicker because of prop firms, right? Yes, we all know they prey on people who don't know what they're doing and they make money, etc. Like that. We all know that. That's that's understandable. But it's because of the opportunity they're providing you. Where, where else can you be like, "Hey, here's a hundred bucks now. I can possibly make a couple grand a month from this $100 investment." Really, nowhere. That's the only, the only place you're going to find that really is prop firms are like gambling on meme coins, right? But even then, it's just something to think about. You're getting a lot more repetition in with your trades on these prop firm accounts. And that's where you start to see a lot more of a learning curve with the prop accounts. The thing you just have to remember for those of you who make some good money, don't gamify it in your head. Don't go, "Oh, it's only a hundred bucks or it's only 200 bucks. Let me yolo all these trades I want. Oh, I don't care if I blew this account. Don't care if I blew that account." Don't make it a game in your head. I call it gamify. Don't gamify it in your head. Take it seriously. Journal what you're doing right. Journal what you're doing wrong. Show up with a risk plan every single morning. Do a risk assessment every single morning. What do you feel okay with? Like when I leave this office, what am I okay with losing? That should be the first thought running through my head. What am I okay with losing? This is a probability-based career. I'm showing up with the potential, right, of losing money. I should think like a retail store. If I'm selling shirts, yeah, I could be selling a lot of clothes one day. One day I might hit it hard, right? Saturday night, a bunch of people came in and bought stuff. Great. But now it's Tuesday morning. I got some people with regret purchases. I got some people that don't like the shirts. I got some people that are just upset because of the quality. And now I got to deal with a bunch of returns, right? Losses. I had the wins on Saturday. Now I have the losses on Tuesday. Kind of the same mindset, the same thought process. It's not always, there's no business, there's no career, there's no skill you're going to find that just goes straight up. That's just not how life works. It's going to go up, down, up, down, up, down, like that. Okay?
So, as long as we're understanding that in our head, when you show up to trade, you are more than likely going to be successful. If you show up with the mindset of, "I just need this to go straight up no matter what," it's just not going to work in the long run. All right? So, just keep that in mind as you're trying to trade and as you're showing up, you need to have a checklist that you go through. You need to have a game plan that you're going through. And more important than not is just build a system and follow your system. Whatever your system is, odds are it's going to take a few months to figure out your system and then once you figure it out, odds are it's going to take a few months to actually refine that and start making some money with it, right? You're not, it's not like you're going to learn a system and be profitable day one or like, "Oh, in three weeks I'm going to nail this and I'm going to know exactly what to do." It's just not the case because you have all these things that are out of your control, right? What, what if you learn a great system, but it's during a time frame where the market just consolidates for a month straight? That's obviously really tough because any system is going to struggle if the market's not giving us any movement. You're going to have a lot of trades that have very shortlived, you get stopped out a lot. So, that's where the discipline comes in and really tests you to see, well, can you follow your risk plan? Are you going to not overtrade? Are you going to take two losses and call it? You know, what are your rules with this stuff? So, we need to find what works for you. Then you start implementing that. All right.
Just remember though, you have to remember why you started in the first place. You got to remember what you're shooting for, what's realistic, and what can you actually see working in the long run. Again, I'm a big fan of if you can find someone that shows you live trades in real time and you can see it play out. So, you can see that strategy work legitimately. There's no editing happening. That's where you can really start to soak in the knowledge in your head and be like, "Wow, okay, I can see this is actually working. This is real." Like, and then it helps you grasp the concept. It helps you understand it more. So again, it all boils back down to that practical application of a successful strategy. All right.
Um, I'm going to be making eventually a big, you know, all-in-one video with all this stuff culminating inside of it, like a full how to day trade thing, but for now, this mindset thing, this is what I see a lot of people struggle with. So, I wanted to get this out as soon as possible. So, hopefully this provided some value for you guys. Um, feel free to put any comments below, things you're struggling on or things you want me to touch on or if you want to make a separate video about something, put it below. Um, because I'm making a bunch of stuff right now. So, let me know. All right, guys. 1% better every single day. All right, y'all. Crush it. Have a good one.