Trading Mindset - Live vs. Demo

By Doug West

Of the nearly 1000 people we have taught how to trade the mini-Dow or S&P emini index, nearly all were able to successfully trade our simple index strategy on their demo accounts (we only know of 2 exceptions that reportedly could not even get consistent on the demo. One man claimed that every single trade he made was a loss. In my mind that would be as hard to do as to make profit on every trade). Yet, some have a problem going from demo to live trading!

If your day trading strategy is consistently successful on your demo account, then what is the difference when you go live? Mindset! It all boils down to that in your trading (in my opinion this is true of life in general, but you see the results immediately in trading - especially day trading).

I really hate to call what we do as index traders, day trading. That is only because of the negative connotation the term brings to mind. Stock trading is what most people think of when they hear the term day trading. Regardless of what type of trader you are, you will have to come to terms with the fact that each trade depends on YOU. What frame of mind you are in at the time you place those trades will have a HUGE impact on how many of those trades are successful.

Most traders think that it all boils down to the technical and/or fundamental analysis of the markets. This is where they spend all their time and money, but they never get around to working on the mindset. They feel the real key is in becoming a great market analyst. However, the world is FULL of good market analyst (just watch CNBC or Bloomberg for examples) who are not able to trade. They too didn't have the right mindset and had to take jobs instead.

So what is the right mindset for a trader (or day trader)? That would take volumes of articles to answer. A good start is to read Mark Douglas' book "Trading In The Zone". Don't end your mindset training there, but it is a good start.

Another good exercise is to keep a traders diary. Write down what you were thinking and how you were feeling as you made your trade. Do this immediately after the trade so that you can be as accurate as possible. Do this on winning trades and on unsuccessful ones too. You should notice that on your winning trades everything felt easy and sure. Once you notice the difference, don't enter trades unless your mind is in the correct frame!

It's amazing how the human mind is able to pick up on the overall mood of the market. Douglas calls this being "In The Zone". We have always referred to it as getting a "Market Feel". Some traders have felt that it was impossible, while others gain that market feel advantage rather quickly. The difference is always in the mindset of the person. Some people are naturally much more in tune with their emotions, and they don't let them effect their mind while trading.

Many traders get hung up in all the technical tools that are available today. They reason that if they can just add the right tools, they will become successful traders. After working with hundreds of traders over the years, I can tell you for certain that you will NEVER be successful unless you have the right mindset. - 16586

About the Author:

Mini-Dow Index Trading Made Simple. Discover how to build your trading income. Get Doug's Debt-Free Report. Read his blog here.

Index Trading Tip

By Doug R. West

We are often asked why so many of our index trading students are now trading the Mini-Dow successfully and not the S&P Emini. While any index will do, we especially like the mini-Dow.

Because of the faster movement of the Dow versus the S&P 500, the mini-Dow more closely follows it's big board parent.

So if it is just a matter of speed, then the mini-Russell would be even better right? Not exactly. The problem with the Russell is the low volume. This will no doubt change in the future. The mini-Dow had too low a volume for our money just a couple years ago, but that has now changed.

One more reason why we prefer the Mini-Dow is that we like no-cost tools, and it is much easier to find a reliable Dow chart. In fact there are many online that work just fine.

No matter which Index you prefer, we feel it is an advantage to watch the big board chart, and not the mini chart. We also prefer the 5 minute time frame.

Many traders watch both, which is what I did years ago before deciding to focus on the big board. Here's why. I found that I would not move on what the mini chart was telling me unless I confirmed it with the big board. A popular confirmation among traders. It finally hit me that if I would not make a trade without confirming it with the big board, then why did I need the mini chart at all?

When I dropped the mini chart and focused on the big board movement, my trading improved. I have sinced confirmed this strategy with Hundreds of my students and other traders. Just recently, one of my students who moved on to using the mini-chart (a paid service I might add), came back to our style and is now focusing on the no-cost big board chart we use. He also confirmed that his trading improved, and he now sees why we focus on the big board.

The mini chart (even in the 5 min time frame) is like trading with a 1 minute chart. There are too many head fake moves that get you in a trade before it has fully developed. The big board averages some of those moves out for you. It keeps you on the sidelines when you should be. Sure, you might not get in as early on some runs, but in the long term it will save you!

It is difficult to catch any move from top to bottom or vice-versa, but by watching the big board you can fairly easily get a nice chunk out of the middle (or many chunks with our BIG MONEY small trades strategy). A few nice chunks a week will keep you from needing a bail out plan! - 16586

About the Author:

Mini-Dow Index Trading Made Simple Doug West has taught thousands how to grow wealth with simple Index Trading and online marketing of products and services. He has affiliates that have earned $100k in less than a year.

How a real estate investor turned into a jackass

By Jesse Davis

At a closing the other day I saw something really stupid. I watched a new investor turn into a jackass right in front of my eyes in the closing attorney's office. I could swear he had big ears pop out of his head and a long tail shoot out. Really, he just transformed into a living breathing jackass.

This investor did not let his attorney know in advance that he wanted to assign a contract on a deal he was closing on that day. Basically, the folks at the office thought he was going to buy the property and then sell it to his end buyer, or just double close the deal. The attorney had everything set up, and then he had to go back and change all the documents (for a title attorney that is double working). Well, if you know the details of that kind of transaction, you can understand why the attorney was pissed.

When the attorney said he was going to charge the guy for redoing the work, the guy went absolutely crazy. He was talking about all the money the attorney makes for such easy work, about being a customer (who is always right?) and bringing the attorney plenty of business, and so on. He was convinced that he should not have to pay for a tiny mistake like that

What a jackass! The attorney had to double work and it was definitely an investor's fault. And the attorney let it slide... but can you imagine the office talk about that investor after he left? Talk about a reputation killer!

Well, if you are making 10k for an hours' worth of work wholesaling a deal, don't you think you deserve the pay you are getting? After all, you have the knowledge to put the deal together. Well, the attorneys are highly paid, and they should be for the education that they have to go through to become what they are. And I certainly would be pissed if I had to do something twice for the same pay, even if it only took me an hour.

Here are two points I want you to get out of this story.

1. Take care of your attorney and make sure you let them know all the details of what you are trying to do - right up front and on every deal - so they don't have to do double work. It saves time, but it also shows respect for the attorney. If you treat them right, the attorney will become one of your best friends in the business and will save you so much money and time!

Besides, a lot of attorneys have money and they can be a great source of private funds or refer you to other people with money they know. You never know, your attorney may become a private money lender to you. So the first point is: DO NOT PISS OFF THE TITLE ATTORNEY - YOU NEED THEM!

2. When you are wholesaling real estate, you are one of the highest paid people per hour around. I mean more than doctors and lawyers. Yes, most of the attorneys I use make a lot of money, but on a per hour basis I blow them away. When you do your first deal for 5k and it only takes you an hour's worth of your time, you will know what I am talking about. If you are an experienced investor, then you know the feeling.

So, knowing that you are highly paid, BE SURE TO RESPECT EVERYONE ELSE'S TIME! Overall point: Don't be a jackass! Be bold, but NICE. - 16586

About the Author:

About the author: Jesse Davis is an expert wholesaler in the Jackson, Mississippi, Real Estate market. He has wholesaled over 80 properties this year alone, and he teaches a seminar on how to really be successful in today's market. Go here to learn how to find all the buyers you will ever need to build a massive monthly income in Real Estate today

Cashflow Versus Appreciation

By Alexandria P. Anderson

Do you want to know the best way to use your money? Would you like to learn the basics of real estate investment? Fret no more because you will discover valuable pointers in using leverage and OPM (other people's money) that makes real estate an excellent tool in investing!

Many who engage in this business have distinct goals, so you must always keep in mind that your team of experts needs a well-trained mortgage professional. For one, the examples below may or may not address your ultimate concern. People's aim may vary from receiving monthly cash flows as additional incomes to preferring investment appreciation in some others.

To vitalize your financial goal, look closely into your options. What's amazing in the real estate market is the assurance that you are in control. For instance, you have $20,000 to start with. With this amount, you can have either a 10 percent down payment on a $20,000 worth of property or a 20 percent down payment on a $10,000 property. Of course, you will be the one to decide which is better.

Maybe you want to ask: what is the difference between these two options? Considering you decided to put in a larger down payment, chances are, you will pay your mortgage at a much lower price and you do not need mortgage insurance at the 20 percent mark. Larger down payments can provide you cashflow if that is what you like.

We'll also assume that the appreciation is 6% for both the $100K & $200K homes. (In reality the appreciation rate could very well be different for each if located in different markets or if property types vary, like a single family home vs. a duplex. We'll ignore these differences for this article). That means after one year of appreciation the $100K home will now be worth $106,000, while the $200K home will now be worth $212,000.

You will have made double the amount of appreciation with the 10% down payment on $200K option, but you didn't have to spend one penny more! This effect will compound year after year and after awhile the difference will staggering.

In no time at all, savvy investors like you will have enough to get you some equity and you can eventually purchase another property. The MORE properties you have working for you, the better the effects of appreciation will be. What are you waiting for? There will be some limitations in paying a lower percentage down payment though such as additional maintenance costs. But those are minor issues if you compare it to the long-term benefits it promises.

Moreover, you get more advantage since debt payments and maintenance costs are tax deductions (using leverage or OPM and getting less monthly cashflow) unlike cashflow that is taxable. In the case of some people who needed monthly cashflow - the solution is simple, your approach can be modified to get what you really wanted. Besides, most people would agree that extra payment every month realizes wealth building benefits in the future!

With these in mind, its not surprising that you chose the better one. Start pooling your team of experts now and make the right choice! - 16586

About the Author:

Alexandria P. Anderson is a licensed Minnesota Realtor that uses the Minnesota MLS to help her clients to find and purchase Minnesota Homes for Sale.

The Federal Reserve & Index Trading

By Doug West

President Bush has been on the TV a lot lately. Too late for him to go down in history as a good president, but we will give him credit for trying. The Pres. has assured us all that we can grow our economy by spending more money. He even sent us each a few hundred to help us do that. One has to wonder if that was a set up for what was to come.

Next came the BIG bailouts for the banks and boys on Wall Street. Hey, where do we apply for some of that 700 Billion dollar pie? Well, don't hold your breath on that one (in a moment we will show you how to cash in on the bail out actions with simple mini-dow index trading)!

Let's see, if you are already in debt up to your ears - like the US government is, how is sending out free money going to stimulate the economy? And, how is that going to help the US government?

OH, don't forget our friends over at the FED. The Reserve! The agency that is owned by the bankers. That masquerades around like they are part of the government. What many folks still don't know is that they all pulled a fast one on us by sticking that word Federal in front of their name. The same thing the guy at Federal Express did when starting his company.

Frederick W. Smith founded FedEx. I clearly remember years ago when he was on 60 Minutes, he said that by the time folks figured out that he was not part of the government his company was already well on it's way to success! Can't blame his reasoning? What a PLAN! IT WORKED for the FED why not FedEx too?

Let's quote right from the FedEx web site:

"Federal Express was so-named due to the patriotic meaning associated with the word "Federal," which suggested an interest in nationwide economic activity. At that time, Smith hoped to obtain a contract with the Federal Reserve Bank and, although the proposal was denied, he believed the name was a particularly good one for attracting public attention and maintaining name recognition."

I'm sure Smith did want a relationship with the Federal Reserve - who wouldn't! These guys have the legalized right to print money! Think about it. It does not matter if it is a $1 bill or a $100 bill, it cost them about the same to make it (a few cents each). Then they "LOAN" that money at full face value to the US government. Full face value PLUS INTEREST! So now you know where the national debt comes from. We now owe that money - Plus Interest - to the FED. A private corporation controlled by international bankers.

So if you are thinking that Bush's plan to grow the economy by handing out $100 bills won't cost anything - Think Again! Where is that money going to come from? That's right - the good ol boys at the FED. These mystical folks seem to be able to pull money out of thin air! Just think, with today's high-tech world, the FED can just punch a button on a computer somewhere and release new funds to the world. Most of which never represents new bills being printed, but just credit in some bank or financial institutions account. Electronic numbers moving through nanoseconds of time and space.

Not only does the FED create money, they also have the ability to set their own interest rate!

- The Fed's Open Market Committee (FOMC), announces their interest rate decisions. This is NOT the interest rate that you and I can get money for, (why don't we all meet at the Fed Discount Window - wherever that is) but what the BIG boys who keep the whole world flowing receive. They in turn pump up the volume and pass the savings on to you and me right - WRONG! It could take weeks or even MONTHS after a cut to see any savings at the consumer level. So why do the markets get so active after an FOMC announcement?

The BIG boys are the ones who really move the market right (and they CAN line up at the FED window for a bailout). We just want a small slice of it. That's all. Remember that when you are trading (or practicing the FED move trade -after an FOMC announcement).

So how do you cash in on the bailouts without getting a slice of the pie? Index trading! With all these bailout moves, the FED buying stock and giving away billions of dollars, it has caused some GREAT moves in the market. Not so good for stock traders, but Wonderful for those of us that just trade and follow the overall index.

No matter what happens, we can all do well with Simple Mini-Dow Index Trading. I look for GREAT times ahead for Index traders. We might have to pay more for the things we need, (because of the FED printing out bailout money like candy these days) but at least we can stay home and earn the money to get them!

Remember those FOMC announcements mentioned earlier? Many times after an announcement, the market moves and moves BIG. Much like the market moves we have all been seeing here lately with the bailout manipulation of the markets. The FED won't give you a partnership deal like FedEx was looking for, but you can capitalize on their dealings.

You may not be able to get in line for a bailout, but you can stick your hand in the market and cash in on the Wild moves we are now seeing in the FED manipulated market. Just follow an index and stay away from stock! - 16586

About the Author:

Mini-Dow Index Trading Made Simple. Discover how to build your trading income. Get Doug's Debt-Free Report. Read his blog here.