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The K.I.S.S. Principle

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The K.I.S.S. acronym is most commonly described as Keep It Simple, Stupid. It is quite applicable to successful investing. Here’s Sal’s take in his own words…

I have been trading and investing for nearly 40 years. I have learned many intricate and complex techniques from some very smart people. I have found the things that really stuck in my head and have been the most useful in my own trading have generally been the simplest concepts. I know there are people who love complex algorithmic formulas. I am not one of those.

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Yes, advanced systems have their place, and we use them ourselves to help scan thousands of potential trades in multiple markets to find the most favorable trades to potentially share with our subscribers. However, I see those as one of several tools to contribute to assessing trading ideas.

Since I began teaching individual investors on how to trade and invest nearly 2 decades ago, I have always focused on keeping it all as simple as possible. Most individual investors do not have the time or the long-term experience to get deep into the weeds of complex algorithms, indicators, and analysis. Instead, they leave that kind of thing to people like my team & me. But a simple approach is something that all can learn and apply quickly, without requiring decades of experience and countless hours of labor doing intense analysis of thousands of stocks, futures, options, ETFs, etc. in search of an ideal few with good short-term potential.

For me, the word Stupid is swapped to Silly: Keep It Simple, Silly. Why? When my youngest daughter was 5 years old, I happened to say the word stupid about a cooking mistake I made in the kitchen. I could not un-scorch that now burned steak. It was a stupid mistake on my part… and I said so.

She overheard me say that word. “Dad” she exclaimed, “that’s a bad word!” I asked, “What is a bad word?” She said, “YOU know.” But I did not know. I guessed “Stupid?” She shushed me again and confirmed… then said, “Don’t say that word again!” Inside myself, I found it a bit funny… but came to appreciate why she felt that way and made it into a habit of substituting the word silly for stupid.”

Learning how to trade well can easily take at least 5-10 OR MORE years of fairly intense study & practice with money in actual trades. Inexperienced DIYers are going to lose a LOT of money if they go at it 100% on their own.

Just as a toddler must learn to crawl before they walk… and then walk before they run… there is lots of time/growth, failed attempts with perseverance to try again & again, etc.… until they reach that point where they are solidly upright on their two feet and can very capably run.

We compare successful investing to professional services like surgery. One can try to do it themselves, but both are likely to result in something bad to disaster if they lean on very little knowledge & experience. There is a very tangible reason we pay a skilled surgeon to do our surgery versus opting to take a crack at doing it ourselves. The same applies to other professional disciplines… like trading. Through naive trading mistakes, nobody will die… but a drained account may feel close to it.

If you only want to trade on your own, we encourage you to:

  1. read all you can, including taking advantage of many exclusive kinds of education in our Investor Education menu,
  2. watch webinars & seminars conducted by reputable sources, ideally with extensive professional histories of trading (like us),
  3. paper trade the markets, meaning spend a good amount of time pretending you are entering and exiting trades and then carefully track what happens like real money is at stake. Whether such paper trades “win” or “lose,” do lots of analysis to try to understand WHY. When you think you have figured it out and are regularly winning in your paper trades…
  4. try actual trades with real money… but risk little so your first experiences do not cause much financial harm. Paper trading and reality trading are NOT the same. There are many new dynamics to learn, understand, and manage when you make THIS switch. For example, relative anxiety surges when real money can be lost… and even that single difference can cause all kinds of other things to occur.
  5. Give your education the TIME- and lots of it– so you can get good at it. Becoming great at anything is almost never leaning entirely on instinct. Greatness takes much study, practice, and experience. There are no shortcuts to greatness for DIYers. Nobody is a born professional trader. All great ones must be cultivated over time.

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The alternative- and faster– option is leaning on professionals like us to help you. We’ve:

  • already been through all 5 of those. We have already made the mistakes and learned from them long ago. We already did our paper trading long ago… and then graduated to real trading long ago too.
  • come to recognize what actually works from countless fluff that sounds great and/or logical but does NOT work. It takes much experience to work through it all to discover the “good stuff.” We have been through that already.
  • learned to manage our emotions, develop the right kind of trading psychology, etc. so that emotions like anxiety do not trigger poor choices.
  • learned to use the right mix of investing vehicles, market order types, etc.
  • developed exclusive models to scan thousands of opportunities to narrow in on a handful each day that- through additional analysis- may become a new trade in one of our services.

Trading is not purely about knowledge; it is about developing a skill set. You need to know the right tools of the trade and when to use them. You need to understand how things that seem to work may fall apart when the market turns… and what mix of tools works better when bull becomes bear or flat and then back again. How do you make money when the market is rising? How do you make money when it is falling? How do you avoid big losses when things are volatile? How do you sustain gains when markets are flat?

We have been through ALL of that… for decades! This website is all about leveraging that long-term experience towards helping individual investors like you be much more successful… NOW… not years from now. We do that with exclusive education like this lesson you are reading right now… and through actionable recommendations offered in our subscription services: trades you can place with your own broker this month to make some money and ‘learn as you earn.’ We would LOVE to help you be more successful. And part of how we do that is with a…

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No-no… the other kind: K.I.S.S.

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