Whether you’re going into 2020 with a large or small trading account…

Know this…

Many traders mistakenly hold an erroneous notion they need a big account to trade the markets.

I’ve got news for you…

If you can’t cut it with a small account, you won’t win with a larger one!

With stock commissions a thing of the past, there’s little reason anyone shouldn’t be able to build an account from as little as $500. Your strategy should never change.

The key to success is adjusting trade management factors like position size, risk tolerance, and trade selection.

Every week I get inundated with emails, asking me if Weekly Money Multiplier works with small accounts. I point to members like Mark, who doubled his within a week.

No, it’s not typical to double an account your first week out of the gate. However, I want to share some insights and tricks to work your small account into a nice nest egg.

Stick to a risk management rule

Even during my best years, I never change the maximum size of my trades until the following year. It’s how I manage both myself and my money.

Other traders I know follow the 5% rule. This popular method allocates no more than 5% of your total account to any one trade as a possible loss. I wrote about it extensively in an article a while back you can read for free.

However, it can be challenging to trade $200 options with a $500 account. That doesn’t leave much room for error before you would hit 5%.

So, you need to adjust your risk expectations. Risking 10%-20% is okay with a small account when you feel you have an edge. Just realize that you have a greater chance of one trade damaging your account.


Choose the right Instruments

Some stocks cost a lot of money to purchase even one share. In-the-money options could cost several hundred dollars. If you only have $500 in your account, a $200 option or a $1,000 per share stock might not work for you.

I prefer to trade options that are at or slightly in-the-money on momentum stocks. These tend to cost several hundred dollars apiece. However, I have members that adjust the strike price and expiration to lower their up-front costs. This works the same setups but fits the trade to their individual needs.


Stick to high probability setups

Not all trades are created equal. Some simply have a better shot of profit than others. Small accounts should work to get modest, consistent gains. There’s nothing wrong with making $50 on a $500 over a month. You keep that up, and you’ll double your money in a year!

High probability trades combine multiple clues to identify setups. For example, my TPS setup relies on a clear trend, consolidation chart pattern, and a squeeze indicator. These three items create a favorable matchup.


Be automatic in your profit-taking

Small accounts don’t have the luxury of letting winners run all the time. You want your money continually working for you, churning out trade after trade – that’s not the same thing as over-trading.

I use the 127.2% extension as my first price target, and 168.1% as my second. If I traded a small account, I would cut everything at the first level. The incremental amount on a per-period basis wouldn’t maximize my capital usage. I’d do better taking a completely new trade.


Create a trade journal

I talk about trade journals all the time in Weekly Money Multiplier. In fact, I have one that I make public to all the members to hammer home this fact.


Notice how I capture all the relevant details to the trades. I also keep a secondary log that takes screenshots of the setups so that I can review them later.

I cannot stress enough how invaluable this is to driving success.


Leverage simulated accounts

Let’s be honest, if you’re trading a small account, you’re probably new to trading. So rather than learn by losing, use a simulated account.

I have members that struggled for years switch over to a simulated account when they first start with Weekly Money Multiplier. The way I trade may not be the same as anything they’ve learned.

They take the opportunity to focus on their trade management and skills without the stress of turning a profit. It lets them work on decision making, which is a key component of any trading strategy.


Don’t be afraid to fail

Blowing up an account isn’t a sign of failure. It’s almost a right of passage. Most successful traders go through 5-8 before they actually turn a profit.

If you haven’t heard my full story before, check out my interview with Jeff Bishop and Jason Bond, where I talk about how I struggled before I finally turned my $38,000 account into $2,000,000.

It’s a free video you can check out here.

Nathan Bear

Although Nathan Bear has made options trades that resulted in over 1,000% profit, he’s “only made a few” he says wryly! Nathan is one of the best options traders there is. Period. His unique approach incorporating his adaptive 3-step “TPS” trading strategy, has so far brought Nate well over $2 million in realized trading profits.

Nate is a down to earth trader who now imparts his simple trading methods and relaxed approach to his trading subscribers to help give them the keys to trading success.

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