Those that can, do.  Those that can’t, teach.

You’ve heard that quote before right?

Well there’s a reason for that.  It’s because for the most part it’s true.

It’s 100% true when it comes to trading.  The only exception is the rare individual who is currently a fund manager or used to be a fund manager that now teaches for fun.

All of the traders I work with, and 99% of the ones that I’ve considered raising funds for, don’t teach.

No disrespect to school teachers, that’s not who I’m talking about.  In fact, hats off to them for working so hard for so little pay.  I’m especially grateful because they’re teaching my 4 kids right now.

Ok, back to the rest of the teachers who wish they could trade.

Doing the simple math will prove my point.

First, here’s the bottom line; we all do what we do for the money.  Teachers and fund managers alike.  I’m no different.  That’s why I’ve gone outside my private network of fund raisers and set up this website and these articles.

You’re the same too.  Why do you go to work each day?

The trading gurus are the same as well, no matter what they say.

So, if over a one year period of time a teacher sells 200 courses at $1,000 each, that’s equal to $200,000.  Subtract $100,000 for refunds, advertising, webmaster, etc. and you still get an above average income.  You could even double that to $200,000 and it’s still nothing compared to what I’m about to show you.

Now, if that same trading guru could actually do what he says he could do, he could make so much more being a fund manager.

This is assuming he’s just an average fund manager and generating a modest 15% profit per year (my traders have consistently done much better), and that they’re in this for the long haul.  Meaning that over time they raise 10 million to trade and charge the average 2/20 fees (2% management fee and 20% performance fee, FYI; my traders and I never charge a rip off management fee).

This would generate a 1.5 million profit per year, times 20% = $300,000 in performance fees.

Don’t forget to add on the management fee which is another $200,000, which equals half a million per year income with no overhead, no webmaster, no refunds, and no headache.

Also, don’t forget that most of these teaching guru’s claim to generate a lot more than 15% profit per year.  So generating their supposed “150% per year return” would put about 5 million per year in their pocket.

Now, why would anyone who is “such an amazing trader” decide to teach for a few hundred thousand or even a million a year, when they could be trading and making the kind of money I’ve just described?

I know exactly why.

Because they can’t trade!

Ed Seykota, a very famous trader, said it best when asked the most important advice he could give to the average trader.  His answer was this:  “He should find a superior trader to do his trading for him, and then go find something he really loves to do”.

I agree.

Trading is just a vehicle for people to get where they want to be.  Ninety-nine percent of them don’t really want to learn a trading system, or be required to have the discipline of a Navy Seal or Green Beret in order to be successful in trading.  They just want to quit their job or fatten up their retirement accounts.

If that’s you, call me today.

If that’s not you, then I publically challenge you to compare your trading results, or the results of any of your gurus who are trading real money (which is very few of them), to the results of my traders for the next 12 months.  After 12 months you should be able to appreciate what Ed Seykota and I are saying.  And yes, I will say “I told you so”, but after that I’ll be happy to help you out if we have a fit.

Lastly, you can always do both at the same time.  Keep trading for now and fund an account with one of my traders at the same time.

My guess?

In less than six months you’ll stop your own personal trading and never buy another trading guru’s product again.

Let me know.

Good luck,

 

1. Expect Draw downs – A draw down is when your account balance falls below break-even.  At times my traders go through multiple losses that could keep your account below break-even for days or even weeks at a time. Draw downs WILL occur. It is inevitable. It is a part of every successful long term trading strategy. We can not predict when it will happen or how much will be lost before the account returns to profit.  Hopefully it’s not during your first week of trading, but if it is please only judge it after 30-60 days so it will have time to come back to profit. After the account has earned a good amount of profit it should be very rare for a draw down to be large enough to make your account fall below your starting point.

 

2. Begin each month with low expectations – Hope to win, expect to lose. By doing this you will keep your emotions in check. THIS IS ESPECIALLY IMPORTANT DURING YOUR FIRST 30 DAYS. Your first 30 days may turn out to be the best ever, or may also be a losing period. As you know, by the end of most calendar months or years my traders have earned a profit.  However there are always some drawdown periods even during those months or years, which is normal.  Let me tell you an all too common story. An investor deposits his money, hurries through the risk disclosures, spends just 30 seconds reading up on foreign currency exchange and begins his first week with unrealistically high expectations. The investor is immediately affected by Murphy’s law, as is usually the case with investments such as this, and the result is a 5% draw down by the end of the first week. In a hurried panic the investor withdraws all of his money and closes his account vowing to “never do that again”.  For the next year he incessantly complains to his friends about how terrible the investment was. Meanwhile, as the investor is off licking his wounds and telling his sad story, the trading system is working its way back into the black. By the end of the month the system has not only overcome its draw down but closed with a profit.  Keep expectations to a minimum.  That way you are pleasantly surprised when your investment does better than expected.

 

3. Monthly Progress, Quarterly Results – No matter what we say, there is no way to convince the average investor not to run home from work each night and check the results of that day’s trades. It’s inevitable. While we would love it if you didn’t, we know that asking or expecting this is unlikely. However, we do strongly encourage you to take those daily results with a grain of salt. We determine success based on monthly and yearly totals. We may    have three really great weeks and then lose half of what we gained in the first three days of the fourth week. This is not a savings account that consistently grows .0001% daily and by the end of the year your $100,000 is now $103,500. Today your account might grow from $100,000 to $103,000 in one day only to lose all of the profit the next. Keep your emotions in check. Evaluate your progress monthly and quarterly. Contact the bank for your user name and pass code to access your account information. If you have any questions on how to read it please let them know.

 

4. Withdrawing Funds – When and why you withdraw funds from your account is completely up to you. We have absolutely zero say in the matter. The account is in your name, and yours to do with as you please. We strongly recommend though, that you plan to take your withdrawals after you have 1-2 years of compounding working for you. Withdrawing funds too often hurts your account’s ability to compound its profits. The purpose of leaving profits in the account is to have compounding working for you.

 

5. No trade days – There are days that it is best not to trade. These days may include many holidays, days of significant market uncertainty, and the occasional day-off (trading 24 hours per day sometimes requires the occasional day off). If there are no trades in your account for a day or two or even a week here and there, don’t worry, it’s completely normal.

 

6. When to add more money – If you have studied my traders past returns, you will note that they experience draw downs from time to time, but they typically don’t last too long.  In my opinion, during a draw down is actually one of the better times to add funds to your account.  It shouldn’t be long before things jump back.  Most investors tend to add more funds after a hot streak, which is a good idea, but we believe a better time is after a 2-3 week flat or down period. When you trust a trader and his trading strategy, draw downs are to be expected and taken advantage of.

 

Andrew Divis
OnTargetFX
“It’s who you know”

During my time in the trading industry I have seen numerous traders, raised millions of dollars for traders, and also managed millions for clients myself. More importantly I have built numerous relationships throughout the industry, and have been careful to keep those relationships strong.Through these relationships I have either traded at (or worked with traders who have traded at) nearly every major Forex Broker / Futures Commission Merchant (FCM) out there.  To politely summarize our experiences, it is sufficient to say that we have found them to be highly lacking in honesty and integrity. There’s a whole laundry list of reasons why I will no longer work with Forex Brokers.  For starters, you don’t need to look much further than the Refco and MF Global scandals in recent years, not to mention the tens of millions in fines charged to many of the so called “top” Forex Brokers for unethical business practices.  Just do a quick web search for “Forex Broker Fined”, and you’ll see some of the numerous fines and legal actions that have been taken against not only small startup Forex Brokers, but also those touted by many in the industry as being “the best”.  They have been fined for slippage, dishonest trade execution, unethical business practices and trading against their clients, just to name a few. 

But enough about why I feel Brokers are so bad.  Let’s talk about the reasons why Banks are so much better.  There are of course the obvious reasons like deep liquidity, transparency and customer service.  But I’m not talking about just any banks.  Three words describe the main reason my traders only manage money at our recommended Bank.  Swiss…Investment…Bank. It is an established Swiss Bank regulated by the Swiss Financial Market Supervisory Authority (FINMA). This means a higher level of transparency, liquidity, institutional trading vs. retail, customer service, and more importantly banking secrecy and safety of deposits. No Swiss Bank has ever gone bankrupt. Yes, you read that correctly.  Even if they did go bankrupt, the first 100k of your deposit is fully guaranteed (not against trading losses, but against bank failure), and the remainder would be handled on a case by case basis by the Swiss Banking Association.

 

By now you should have a good understanding of why I will only deal with the safety and security of a Swiss Investment Bank when it comes to my traders and clients.  You should also understand why I won’t entertain any requests for my traders to manage your account at some Forex Broker.  Yes, there is a big difference between Banks and Forex Brokers especially if you have any consideration for the safety and security of your deposits.