Alex TAGRtrades is an unusual day trader. First, he’s a long-biased trader who focuses on penny stocks. Typically, OTC land is for short-sellers, but there are some exceptions, of course. Second, after experiencing a huge loss in May of 2019, he didn’t get discouraged. He went through all stages of grief, and he emerged on the other side, stronger and wiser than ever.

It was late 2019 when we recorded this interview. I suggest we take a short trip into the past and watch this video, Alex sure had some amazing thoughts to share!

They say that you won’t have to work for a day when you do what you love. The more I day trade, the more I realize that it’s completely not true. I’ve met many traders, and I have yet to meet a single person who didn’t get close to burnout or wanted to give up at some point.

Alex TAGRtrades certainly knows what it’s like. It’s hard to jump back in after a huge loss, but he managed to do it. He dropped some amazing knowledge in the interview above, but let me summarize it here for you as well.

1. Realize that losses are inevitable.

No matter how successful you are, you can’t skip losses. If your strategy works well 60% of the time, that automatically means that 40% of the time you’re going to be wrong. Out of that 40%, 5% you’re going to be really wrong, losing way more than you could anticipate. The key is to understand that this process is perfectly normal and that everything is still going according to plan. Thanks to this way of thinking, every setback convinced him that day trading was the way to go.

2. You have to be able to move on from a bad trade.

As we’ve just figured out, losses happen on at least 40% of trades, which is almost half of the total amount. You can’t let that fact stop you in your tracks. It’s ok if you have to take measures to minimize the effects of future losses. For example, Alex cut his position in half in order to regain confidence and trade at a slower pace. However, he didn’t stop altogether. On the opposite, he managed to bring back his P&L chart to its original position within a week and a half. If he gave up, it would not have happened. Besides, the month of May tends to be a slower time for long buyers. It could have happened faster, but Alex took his time to learn his lesson, adjust his strategy, and get back in the game. All that matters is that he managed to trade well after the loss. Least of all you want to feel devastated and discouraged, constantly reminding yourself that you start each new day at a negative value. You have to teach yourself to approach each new day and trade as a brand new one, learning the hard lessons but leaving the hard feelings behind.

3. You have to get over the good trade just as fast as the bad trade.

You have to get into a new trade feeling like it’s a brand new day and a brand new transaction. You can’t allow yourself to despair because of a previous loss, but you also can’t get too cocky or overconfident because of a past win. Moreover, if you’re getting too hung up on your past trades, both good and bad, you’ll end up leaving money on the table.

Earlier in his career, Alex would stop trading for a day or even a week after hitting a great trade. I know for a fact that he’s not alone. Depending on the personality, some day traders may be petrified of making a mistake and wiping their green day or not living up to the new level of success and making less than they did before. Either way, you shouldn’t walk away from an opportunity for no good reason. You’re not trading in a vacuum, and the market has its own highs and its lows. If you’re on a roll and the market is hot, you have to put your feelings behind and keep going. As an experienced trader, I can tell you for a fact that there will be times when you won’t have any decent setups to trade for days or even weeks. The time is now, and you’re much better off seizing the opportunity when you can.

Having The Right Mentality

As you see, having the right mentality is a must for a day trader who wants to be consistently profitable. There are many roadblocks on the way to success, and you fear, past traumas, losses, and limiting self-believes are certainly some of them. But you have to keep going and remember why you’re here to begin with.

And that’s where goal-making comes in. Alex has a really interesting setting goal-setting system, where he sets three monetary goals for each year. The first one is the bare minimum that he has to make. The second one is a decent amount to make his and his family’s lives comfortable. And the third one is a lucrative amount of money that would be great to have, a new overall high to achieve. And while it would be amazing to have them all checked off by the end of the year, it’s important to appreciate each goal and what it means for you and your family, and acknowledge that maybe not all three will be reached necessarily.

Also, it helps to look at monthly or yearly goals rather than just daily or weekly targets. It’s easier to keep your head in the game and keep trading when you have something bigger to look forward to, is it?

Also, that’s how you slowly realize that a green day is not a one-off thing. You don’t happen to do some day trading on the side; you are a day trader. Realistically, it doesn’t matter how new you are at this or if you do it full-time or part-time only. The point is, you take yourself seriously. You are a day trader.

And once you have a totally different attitude about what you do, you can actually prevent the burnout. Hitting a burnout is common, and it happens to everyone. You might love your job and do it well, but the pressure eventually gets to you. As humans, we tend to keep pushing when it’s really time to step back and enjoy the fruits of our labor, even if just for a moment.

After all, life is more than just your job. Family, hobbies, and travel help you transform your monetary goals into feelings and experiences. Now you’re not chasing just a dollar amount. Instead, you have something very tangible to look forward to. Taking a break and letting yourself live a life doesn’t get in the way of you reaching your goals; it creates more motivation to reach them.

That kind of approach may lack instant gratification, but it sure works. Besides, you can create incentives for achieving short-term goals too, such as hitting the new daily high and rewarding yourself with a nice bottle of wine or a steak.

Going Long

If you are a long-biased trader, I strongly recommend that you watch the interview above. As a short seller myself, I didn’t realize the extent of pain a long buyer can go through when trading a large size. However, that definitely explains why Alex has been trying out bigs caps lately. But of course, the big cap market has its own challenges.

Obviously, one needs way more capital to trade big caps. As a beginner trader, that might be an issue, even though now there are ways to trade fractional shares. On the bright side, you never face issues with liquidity, which is pretty common in the OTC market.

Alex also mentioned that he was quite stoked when going long became commission-free. Before that, he’d lose thousands of dollars on a trade gone bad because he didn’t want to overpay the commission fees. If he was trading penny stocks and the stock wasn’t liquid, he’d have to wait until someone was willing to buy his entire position before exiting the trade and accepting the losses. Now he has an effective strategy to sell off any position size no matter the demand.

What was your favorite part of the interview with TAGRtrades? Did you learn anything new about going long? To see more interviews with successful day traders, check out my Youtube channel and podcast!