HOLY GRAIL BLOG
Saturday April 11, 2020.
A COMMENTARY for EASTER HOLIDAY WEEKEND (5-minute read)
I've been trading 3x BULL & BEAR ETFs exclusively for my own account for over 10 years, since the financial crash of 2009.
I have been operating this website HGTS for the benefit of other Traders for over 5 years, since 2015.
Since I started, I’ve learned an awful lot, much of it from hands-on experience and I am still learning, because no 2 days are alike and the trading goal-posts are always moving.
I have learnt the hard-way from my early mistakes in years past.
In 2010, when OIL was extremely volatile (like this past months Markets) I held ERX (OIL BULL overnight) and by Open the next day, I'd lost 30%.
In a state of panic and dis-belief, I switched to ERY (OIL BEAR and held overnight) and by Open the next day had lost another 30%.
Total 60% in losses of my substantial account in 2 days.
I was almost wiped out financially.
It left a deep emotional scar, but in hindsight it turned out to be a hard-earned but valuable lesson, from which I myself and others have benefited from.
And I have not been the only one to lose trading 3x ETFs.
Over the years, I’ve received many emails from Subscribers who made their own trades (not HGTS alerts) and they have lost similar amounts.
One devasted young man told me he lost 80% of his capital holding NUGT (GOLD BULL).
Recently, this particular ETF and other highly volatile 3x ETFs, have been reduced to 2x ETFs, because they are so dangerous.
The vast majority of 3x ETF traders, now no longer trade them, due to their losses.
However, the losses that I personally suffered back then, didn’t detract or stop me trading 3x ETFs.
On the contrary, it gave me added determination to turn from being a loser, into a winner.
I enjoy a challenge and was determined to succeed and beat these 'Monsters' of the trading World.
After several traumatic and painful trading days over the years, I became much more careful and erred on the side of caution.
Since that time, I have seldom lost much more than 10% on any single trade, and usually I’m NOT ALL IN to any one single 3x ETF, meaning I usually lose 5% overall, maximum.
And to counter that, there are HUGE winning trades, many into triple-diget gains.
But actually, very few Investors or Traders buy or sell 3x ETFs, because they are considered to be way too risky.
Most Traders who trade them will only Day-Trade and don’t hold overnight.
Very few hold for weeks at a time.
But if you want to make good profits, you have to hold both overnight and hold long.
Because most times these 3x ETFs Gap UP (& conversely Gap DN) at Open, which is when the bulk of the profits (or losses) are made.
I watch CNBC now and then and log into Marketwatch.com (WSJ) to keep abreast of what the professionals, experts and pundits have to say.
I can honestly say, that I cannot remember when 3x ETFs have ever mentioned.
And it follows there never is no mention of buying 3x BEAR ETFs, even when the Market turns DN.
It’s like these instruments don’t exist..
Just because losses can occur or just because 3x ETFs are never mentioned by the pro's, do not be put OFF from trading them, but only IF you know what you're doing.
On the contrary, I personally wouldn't trade anything else, because I believe in them and I know what they can achieve.
IF you do decide to trade them, it is essential that you do so via a 'tried and tested' Strategy that works and most importantly, stick to it!
IF you trade willy-nilly or spontaneously, that will spell disaster for you and it will end quickly your trading career in 3x ETFs.
Subscribers pay me to make good Trading CALLS, which they can 'take or leave'.
Others have placed total faith and trust in me to trade their precious own capital via Auto Trading.
As such, I take my responsibilities very seriously and therefore I use my 10 years experience and my past trading losses to benefit others.
I tred very cautiously and carefully and take few unecessary risks.
HGTS policy is that if you don’t get in, at the very bottom, or close to, of a BULL or BEAR CYCLE or SWING trade, it's better to to wait it out until the next time, for the reversal.
We might miss some profits doing that, but we might also save some losses too and remember:
#1. Preservation of Capital is paramount, and
#2. There’s always tomorrow. God willing.
And then once you do make a 3x ETF CYCLE or SWING trade, the upside can be tremendous, IE. Our 3, Feb 20 – 23 trades returned an average gain of 67%. (documented and verified by Global Auto Brokers)
Our 3, Apr 03 – 06 trades resulted in small losses. Not a problem.
But between the 2 sets of trades, there was a NET average gain of 57%, during a period when most other Investors lost 20% - 30% of their capital.
A difference of 85% to our Subscribers, in no time at all.
It's possible we are headed for a new BULL MARKET, so we have BOUGHT 3x BULL ETFs in the Highest-Rated SECTORS.
And given the tremendous gains, you can make in either BEAR or BULL 3x ETFs, you don't need a lot of capital to make some good money.
You can easily make 50% - 300% in some trades in a very short time.
I would like to add that most professionals say it’s impossible to time-the-Market, but I beg to differ, it IS possible.
We use PROPRIETARY Technical Indicators to determine the TREND and reversals to the exact day, confirmed 1 - 2 days later.
These are facts and the proof is detailed for you to see in the LIVE TRADING ROOM.
Trading 1x ETFs or regular Stocks can be a proverbial 'piece of cake'.
Any Joe, his brother and his wife, can pick stocks, but usually they'll make crumbs in profits, compared to the gains you'll make by successfully trading 3x BULL and BEAR ETFs.
Don't accept the crumbs of life. Set your goals and standards high.
May I take this opportunity of wishing you and yours a very Happy and Blessed Easter Weekend, as best you can, given these difficult circumstances we are living through.
Thank you and God Bless.
This Article was updated on July 24, 2020.
Day Trading - Good or Bad Idea?
A few lucky people do win the lottery, but odds are it won’t be you. That’s also how it is with day trading.
Day trading is the practice of buying and selling a stock over a short time frame, typically just a day. The goal is to earn a profit on each trade and then compound those gains over a handful of days. The problem for day traders, though, is that they’re usually the ones on the losing end.
Day trading may be the fastest and most glamorous way for retail — or nonprofessional — investors to wreck their portfolio and retirement.
HOW IT BEGAN.
With the rise of the online stockbroker and cheap trades, day trading became a viable, if inadvisable, way for retail investors to trade stocks. Traders look to add up daily gains, turning a few days’ worth of quick wins into a substantial bankroll.
That’s the theory, anyway.
In practice, retail investors have a hard time making money through day trading.
Sure, they guess right from time to time, but the vast majority lose money. A 2010 study by Brad Barber at the University of California, Davis, suggests that just 1% of day traders consistently earn money. The study examined trades over a 14-year period, from 1992 to 2006.
The very small number who do make money consistently devote their days to the practice, and it becomes a full-time job, not merely hasty trading done between business meetings or at lunch.
GAMBLING IN DISGUISE.
Day trading is the epitome of short-term investing, and that kind of investing is a zero-sum game. In other words, your loss is another investor’s gain and vice versa. So for most investors, day trading is really gambling in disguise, trying to beat other investors as they’re trying to beat you, with the house — the brokerage — taking a piece of the action in the form of commissions.
If you do become a successful day trader, you’ll have to pay taxes on these net short-term gains at your marginal tax rate, currently as high as 39.6%. The IRS defines net short-term gains as those from any investment you hold for one year or less. Even if you don’t hit that top bracket, the government will still take a sizable chunk of your earnings, with lower rates ranging from 10% to 35%. You do, however, get to offset the gains with trading losses.
WHY DAY TRADERS RARELY SUCCEED.
Day trading is so difficult for a variety of reasons, but they boil down to two major categories.
First, retail day traders are fighting against professionals who devote their careers to it. Pros know the tricks and traps. They have expensive trading technology, data subscriptions and personal connections. They’re perfectly outfitted to succeed, and even then they often fail.
Among these pros are high-frequency traders, who are looking to skim pennies or fractions of pennies — the day trader’s profit — off every trade. It’s a crowded field, and the pros love to have inexperienced investors join the fray. That helps them profit.
Second, retail investors are particularly prone to psychological biases that make day trading difficult. They tend to sell winners too early and hold losers too long, what some call “picking the flowers and watering the weeds.”
That’s easy to do when you get a shot of adrenaline for closing out a profitable trade. Investors engage in myopic loss aversion, which renders them too afraid to buy when a stock declines because they fear it might fall further.
THE SAFEST AND BEST WAY.
If you’re dead set on day trading, open a practice account and give it a go first before committing any real money. Many brokerage accounts offer practice modes, in which you can make hypothetical trades and observe the results. Above all, be honest about how you would trade in real life, since you want an accurate gauge of performance.
95% of Day Traders loose Money!
Does this look familiar to your trading pattern?
What you're up against!
NEVER GIVE UP!