Trading from Michael Marcus. The Golden Rules of a Great Investor
How many people do you know who have been successful in the financial markets? How confident are you that their words are backed up not just by words, but by real results?
Then a completely logical question arises, if you have practically never met such people, why do you trust advertising and stories about easy money, believe various analysts, and even follow their advice?
Michael Marcus, a famous trader and investor who managed to turn $30,000 into $80 million, addressed similar questions to reporters during an interview.
The advice and strategy of a practicing trader such as Michael Marcus carries a real and necessary information load, thanks to which almost any beginner can learn something important for himself.
In this article we will look at the key rules and basic principles on which Mile Marcus based his Forex trading strategies.
Principles and advice from Michael Marcus
1. Your own path and individuality
The key rule of Michael Marcus when trading is to rely solely on your own strengths and your own strategy.
In one of the few interviews, Michael said that he has a lot of friends who are traders who have achieved success on the stock exchange. However, the moment he tried to apply their strategies, their ideas and views, failure always occurred.
The fact is that any strategy developed by a trader can only be effective in his hands, because everyone has a different attitude towards losses, knows how to wait for profits and generally endures stress during trading.
Therefore, each beginner must follow his own path and develop his own individual approach to market analysis.
2. The cult of personality and social trading
How many times have you, while searching for information, come across various forums where market conditions were discussed?
How much have you read global market shark forecasts? Perhaps your broker has a chat function where everyone can share their opinions?
In fact, all this social trading, where the opinion of the majority is taken into account, according to Michael Marcus, only leads to the drain of your deposit .
In fact, most of his trades were taken against the market and the crowd, and not the other way around.
If you are deprived of money and time for social experiments that will lead nowhere, it is more effective to spend it on learning and self-improvement. 3. Be objective and trade only the truth
Trading for a beginner is in many ways similar to a person wandering in the fog, who does not even see what will be in front of him in a couple of meters.
Unfortunately, traders are inclined to trade lies, because their opinion is extinguished by various news, rumors, expert opinions, and the like.
However, in order to achieve success, you must be objective and soberly assess the market situation.
According to Marcus, only the chart and the changes recorded on it using your strategy will help you with this. 4. There are no universal strategies
Many traders, as well as beginners, suffer from the search for the Grail as well as the endless improvement of the strategy so that it is effective always and everywhere.
However, the reality is that such strategies simply do not exist, and if we talk about Marcus’ experience, he created strategies for certain assets, as well as the features of their movement.
In one of his interviews, he argued that it makes no sense to invest using the same investment strategy in third world countries as in the US or European markets.
Therefore, Marcus strongly requires traders to test their strategies on specific assets and adapt to its characteristics.
5. Five Percent on an Idea
Michael Marcus achieved his successes through strict risk control.
Of course, the phrase set stop orders for your transactions sounds trite, but Marcus introduced another restriction that he has used all his life - the risk on an idea is no more than five percent. An idea means a certain segment of trading, namely a certain strategy and shares.
Thus, if you allocate five percent to one trading idea, you will never lose your entire deposit, because this is almost impossible.
6. Trades should be opened when three factors coincide.
Surely you are tormented by the question of the trading style of this trader and the tools that he used.
In fact, he used three trading styles to make a decision, first he studied the direction of the trend through technical analysis .
He then checked the direction of the trend against the direction of fundamental analysis, studying the economic background. The trade itself was opened at the time of publication of some news, and Marcus looked at the reaction of the crowd and its mood, which should have coincided with technical and fundamental data.
If at least one of the factors upset the balance, the deal was not opened. In conclusion, it is worth noting that the strategy and life rules of Michael Marcus will allow many beginners to avoid wasting time and money, moreover, by following them you will definitely achieve success in stock trading .