Trading is a Business!

Písmo: A ++ A --

Guess what… trading is A BUSINESS, just like anything else. Now I know that you‘ve heard this before, perhaps zillion times over. But I think that most of us take this statement much too lightly. Let‘s put it in a different angle for a minute, shall we.

Let‘s look at it from my usual weird way of thinking, okay?

Cool. Let‘s open a flower shop, then!

First of course, we have „location“. This doesn‘t apply to us, so we can move ahead.

Secondly would be our purchasing of flowers. Well, I‘m not much into flowers, but anyway. What we want is THE BEST flowers at the best price, don‘t we.

Bring me a carton of decent flowers and I will make ‘em mine. But bring me a carton of wilted or bland or otherwise second-grade flowers and you‘ll find me not buying.

You can have the whole Swedish bikini team out there trying to persuade me into purchasing, I won‘t. Not interested.

These rejected flowers go to the deep discount florists someplace, but this is my business – and I want only the best deal I can get!

Because, how long would I stay in business offering flowers that nobody wants? Don‘t florists „hedge“ for Valentine‘s Day and Mother‘s Day? They try to lock in the best price they can, knowing that high demand will put jingle in their pocket if they are properly prepared. And if Mother‘s Day is a windy rainy day, won‘t they lose this investment?

Each business, in order to succeed, MUST be fine-tuned to supply and demand.

Me having some shop-fitting services background from the past, I can tell you that the likes of Tesco, Kmart, etc. all these big names put deliberately their best sellers at your eye level. Placing these on the top or bottom shelves would drastically reduce their sales. They found out that basically most of shoppers turn right after entering a store. So they put their most frequent selling stuff to the right. Each isle is a masterpiece of marketing strategy.

Every business has a simple obligation to itself. Get serious, get competitive or get left behind. Now what is the percentage of new stock/commodity traders who fail at being successful? Now what percentage of new off- and/or online businesses fail? And isn‘t it interesting that these percentages match, roughly? Think about it. What does this tell you?

It tells you that you better become competitive. That if you only take this half-hearted, if you haven‘t the guts to sit down and learn, then you will soon be out of business. History.

If you were to start a traditional business, any business at all, how much investment do you think it would take?

At my business college studies, which I dropped out from, I‘ve been told that to be offered a fair chance you should have enough money behind you to pay all your expenses for a year as if there was absolutely no income at all.

Trying to start a business with $5,000 is going to take more study, more sweat and tears and more downright determination than the guy starting his biz with $50K. Both may succeed. Both may fail. It depends on those finding a demand and being in the right place at the right time. It depends on you and your willingness to succeed. It depends on you protecting your assets until you find „the best deal“ on flowers.

Yet I witness day after day students buying from the first flower vendor to come along. And then they smack themselves for not looking more closely at what the other fella had to offer. They feel they must buy flowers everyday rather than waiting on a really cool deal.

But what is a good deal in our trading business? It is the ability to determine what offers the best profit for the least amount of risk. As simple as that. And it is knowing that we shouldn‘t buy gold when we can only afford to buy tin.

Wait for the best deal to develop in tulips or roses or orchids or what have you and then go ahead and buy them!

My course methods were created to do just that and you know it. But if a good deal is not offered to you, simply say no. Say NO to chasing the markets. Say NO to low profit potential. Say NO to over-trading.

Do the math folks. Do the math. Please?

Be of good cheer, everyone.

Tom