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Why Traders Have an Obligation to Make More Money Right Now

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New and developing traders have caught an incredible break from the trading gods with this market. They now must maximize this opportunity -- responsibly.

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A veteran trader stood in my office, mind racing, frustrated at his results from the past week.

"You know, during '08 I made a lot of money getting back into trading after being away from the game. I told myself that the next great trading opportunity I wanted to be on a trading desk making real money. I am not sure I made enough this week."

The truth? He hadn't.

Back during the Internet boom it was common to have made serious money during a trading day and feel guilty about not making more. You might net 10k and lie motionless on your couch, depressed with lost-opportunity guilt, watching but not retaining the images on your TV. Everyone knew that was a special time. We all knew we had to squeeze as much as we could out of that market because it would not last forever. We spoke out loud about this openly. The air was filled with a fear of this opportunity evaporating. It was carpe diem trading. The opportunity in '08 left. Some developing traders went from decent to putting up 30k, then back to decent. There are many who killed the late '90s and couldn't trade the post 2001 market.

After Tuesday I spoke with some traders in a group setting. I thought they were all a little too happy about making more than they had in the past. New and developing traders have hit the trading lottery for best time to start. Congratulations! But this is a very fragile time. Miss this opportunity and you may set back your career at best and end it at worst. Prosper in this market and you can parlay this good fortune into a career as a consistently profitable trader.

Now some are unrealistic about their expectations. I heard that so-and-so at so-and-so firm put up 50k days during the past sessions. You never hear how much those traders were down when they were not trading well. Like the experienced pro I heard about who ripped up 500k during the first few days of the down move, was forced to put up 250k, and then made 300k back. You may not be able to take on their risk. You may not have their trading skill as of yet. Do not get caught up in the comparison game as it will not help you.

Individually I have been very hard on my mentees of late. Friday I received a review of a trader's work who caught NVIDIA (NVDA) but not for enough size. Argh! In this market this is not acceptable. I immediately asked that trader to redo his review by obsessing about how he could have caught that NVDA move for more size responsibly.

And this is the key. At the end of your day, during this all-important market opportunity, you must obsess about how you could have been bigger responsibly. This market is increasingly a game about ETFs and market stocks. Are you in them? Do you know how to momentum trade and intraday swing trade them? If not, learn fast.

I have called the market of '09 and parts of '10 perhaps too hard for the new trader. The good prop firms and traders merely hang in there during these bad market moments. You cut back, stop sleeping through the night, hold on with both hands to the slippery grip, and pray for the turn. A close friend who is twice as smart as me started in '02, a market a new trader could not succeed in, and now practices law again. Luck plays a part in whether you make it as a trader or not. Again, congratulations to all the new and developing traders in the world. You caught the best break from the trading gods with this market. But you now have an obligation to maximize this chance. You need to make more right now.

Editor's Note: For more, visit www.smbtraining.com.

Twitter: @smbcapital

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No positions in stocks mentioned.

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