What is a ‘Day’s Pay’?
There is no other job as exhilarating, liberating, and rewarding as trading. But often times, people are interested in trading for the wrong reasons and have sky-high expectations before they even place their first trade We can’t blame people for thinking like this since we see it all the time; the ‘zero to hero’ story of the billionaire hedge fund manager who started from his garage or the multi-millionaire trading on his phone from his Bugatti. This ‘successful trader’ image is so prevalent in our culture that it’s no surprise people have distorted views of what it means to be a profitable trader. We all hope to achieve this level of success but the problem arises when new traders fail to meet these high expectations and quickly become frustrated and quit trading for good.
A ‘day’s pay’ is an attainable goal that you set for yourself. Everyone’s different, but at CTU, our goal for every student is to make a gain of (at least) 20 cents per share each trading day. This is a conservative goal, since most of the trades we follow and callout in our trade room increase double and even triple digits by percentage.
There are 252 trading days in one year.
1000 shares of stock
The stock increases 20 cents = $200
Consistency is Key
“Success is neither magical nor mysterious. Success is the natural consequence of consistently applying basic fundamentals.”
― Jim Rohn
The idea of the ‘days pay’ is a concept that is entirely based on consistency. Making $4000 a day, though a respectable goal, isn’t exactly realistic when you’re just beginning to learn to trade. However, consistently sticking to your trade plan, journaling, reviewing, revising and reaching your day’s pay is the recipe to the big bucks that you dream about.
When you look at the multi-millionaire trader you don’t see the grueling hours he put into the research of his strategy. You don’t hear about the sleepless nights he endured after making questionable trading decisions and ignoring his trade plan. You don’t know that it took thousands of small trading wins before he got to the point where he was comfortable trading large size. At the core of a truly successful trader is someone who respects the process every step of the way, while knowing that they will reach their ultimate goal in the end.
The amazing thing about trading is that it is scalable to a certain extent without requiring much more technical skill. A 20 cent gain on 100 shares requires the same amount of technical skill as a 20 cent gain on 1,000 shares, assuming the stock is highly liquid. As you start to scale up even more in share size it becomes less of a skill issue and more of a psychological issue. The market does what the market wants and we can only react to what we see with our best judgement. Since mastering our own psychology is so important, this is why teach our students to start with a small goal. Reaching these small goals add’s up and before you know it, you are the trader you’ve always wanted to be.