Trading is risky, and most day traders lose money. Ross's results are not typical. All information provided is for educational purposes and is not investment advice or buy/sell recommendations. Read our full disclaimer.

Warrior Trading Blog

Timing Is Everything In Life

timing

Timing Is Everything In Life

 

Life is all about timing. That applies to everything, from the simplest action performed multiple times per day all the way to the most revolutionary decision taken that represents the biggest “discontinuity” from our past (read more about the most difficult decision).

So, understanding when is the right moment to do something is huge. In fact, there is no such as thing as doing the right thing by itself. The key is about acting at the best possible timing.

A recent example in history is probably the Dot-com bubble that occurred from 1997 all the way to the pick of 2001. It was the early era when the extreme growth and mass usage at worldwide scale of internet took place for the first time.

Tons of people got fooled by investing in companies that were seeing their evaluation skyrocketing day in and day out for months, in some cases even years. We all know how badly that bubble ended up bursting. Entire businesses were forced to shut down (others such as Cisco, Qualcomm, eBay or even Amazon got devalued by as much as 86%) in a very short period of time, wiping away tons of investor savings.

So, was all the internet meant to collapse? Was it already the end of an era? Not at all! Today, we all know the answer. Still doubtful? Here is a simple fact that should help changing your mind. The five most valuable companies in terms of market capitalization on earth are all tech companies (here is the actual order: Apple, Alphabet (Google), Microsoft, Amazon.com and Facebook).

 

Three insights about timing and trading

So, what went wrong for those investors that lost it all? I think you got the right answer. It’s all about timing. Funny thing is that and the sixth place of the same ranking by market capitalization, we find Berkshire Hathaway founded by Warren Buffett, the oracle of Omaha. The man that has mastered the concept of right timing into investing more than anybody else and managed to build a fortune out of it.

So, how to manage having the best possible timing into trading? Here are my three insights about it:

  • Be focused on what’s happening rather than what you wish for it to happen. That means being connected deeply within ourselves and recognize pattern, setups and possible strategies to apply at the best possible time rather than falling in love with a name just because we like or hate their products or services;
  • Prepare a plan to be implemented at the best possible timing (here is a previous blog post in helping you building a potential stock watchlist every day). The most promising time of the day for trading are the first two hours after the market opens because that’s when the most of the moves statistically happen. Being ready to execute the plan for that time is key to success;
  • Know when it’s time to be sitting tight on the sideline and be waiting for the next opportunity to present itself. In other words, learning how to develop a strategic skill that should definitely be into each serious trader’s bucket list. This is patience (read more about it here)

 

The two most important requirements for major success are: first, being in the right place at the right time, and second, doing something about it.” Ray Kroc (McDonald’s co-founder)

 

See you in chat-room.

 

Trade safe,

 

Roberto Barbaro