We'll help you map out a plan to fix the problems in your trading and get you to the next level. Answer a few questions on our application and then choose a time that works for you.
BOOK YOUR FREE STRATEGY SESSION NOW >>One of the most widespread beliefs about trading is that it's a quick and easy way to earn money. This encourages many people to become traders overnight with the hope of quitting their job, earning a second income or solving their financial problems.
Unfortunately, this approach almost always leads to substantial losses and even worse financial problems.
In this interview with Il Sole 24 Ore Group radio journalist Debora Rosciani, Andrea talks about the origins and effects of this widespread and dangerous belief.
Here are some of the topics discussed in the interview:
- The origins of the belief that trading can guarantee easy and fast gains
- Why trading can't be considered a safe and regular source of income
- If there are any instruments that are better suited to making regular gains than others
Enjoy the video!
Does trading mean easy and fast gain? We’re going to talk about this with Andrea Unger, the 4-time world champion of trading.
Welcome back! We're meeting today on this digital stage to talk about trading. So, what is the scope of our chat with today's guest? The scope is to steer the listener away from the false myths about trading and towards the so-called systematic method.
What do people who approach the world of trading for the first time ask themselves? In other words, what do they expect?
So many questions are asked. For example, does trading really mean doing risky and speculative operations? And also, is trading only for shrewd traders capable of tolerating even very high risks? And also, does trading mean sitting in front of a platform and doing dozens and dozens of trades per minute?
The truth is that these are false beliefs and distorted information that, by the way, often lead many people to rely on non-professional traders – or even real crooks - to perform trading transactions.
As in all professional fields, obviously everything depends on the level of expertise. Today, we're going to focus on the systematic trading method, a method that enables us to make preliminary and upstream evaluations.
The question is why do we need to do this work? Why do we need to use this method? Well, as we said previously, trading is generally perceived by the masses in two ways: a scam or a quick and easy way to make money, and neither of the two versions is true.
The tools to operate in a professional manner in this field, removing the wrong or distorted information that often influences it, are provided by Andrea Unger, the only person to have won 4 times the World Trading Championship in the Futures category. Andrea, welcome back!
Thanks Debora, nice to see you again and hello everyone.
Andrea, why do people think that trading allows you to earn really stratospheric amounts of money?
Well because somebody did earn a lot of money, and because we're often told that it's possible to do so. Well, somebody did earn a lot, but let's talk about that later. Clearly there are many sellers of trading-related services who have every interest in making us believe that we can become rich, so as a result we trust them. And I am not talking about the crooks we spoke about before. We're also talking about promoters of "serious" services who have an interest in making us believe that we can become rich.
If I invite you to trade by saying, "Look Debora, join us because I'll teach you how to set up a system that will make you 5% a year." And you say, “Look Andrea, I’ve already got a balanced fund that makes me more", you look at me.... But if I say “Join us and I'll show you how you can make 500% per year", well maybe you'll listen to me for half an hour longer and then decide later. In reality this isn’t the case, because it’s more like to earn 5% than 500%, without a shadow of a doubt.
But then there was also the question of who made that money. Some people became rich. Let's talk about cryptocurrencies: as we said before, there are people who have made a lot of money and there are actually opportunities in the crypto world even at very low risk. But beware! You can also earn at "zero" risk if the instrument is structured in a certain way. But it takes more skills than usual and you might also have to do more complex financial operations than just trading. We're not talking about buying Ethereum or Bitcoin and wait, because that isn't the case.... We're probably talking about DeFi operations, and so on, you know.... All things that require crazy, industry-specific expertise, so it's not easy and you definitely can't learn it over the phone from someone calling to explain it to us…you have to study more.
So, someone got rich because they were in the right place at the right time. I don't know what the chances are that this could happen again because otherwise, just imagine for a second, it certainly would become a big topic of discussion. If a person with € 1,000 made €100,000 and did it again, after a while he would have €10,000,000 and then, €1,000,000,000 ... I don't see these things happening here. The people who made the money are the ones who bought Bitcoin at super low prices and kept it for a long time. Who here would have done that? Let’s be serious. If I had bought Bitcoin at €0.1, when it reached €1, I would have sold everything. I wouldn't have waited for it to arrive to €50,000, no way, that's it.
And so, illusion makes the trading market survive. So, you can do, you know, you can earn a lot with trading. You can earn a lot more than with many other traditional investment strategies, but it isn't a game that you can improvise overnight. So, the performance will never be amazing, unless you’re lucky. You can have good results but you have to work at it and it's important that people know this. If you want to do anything well in this world, you have to work hard and dedicate time and effort, and the same applies to trading. There's no trick and neither does the cleverest guy have a trick that works.
Now, that's a very clear message. But there are also those who think.... Let me put it this way, there are also those who have the so-called side hustle approach. I put in one or two hours a day, after dinner, after my main job is done, I have dinner with my family, I sit for a couple of hours in front of a trading platform, I make two trades and I can earn a second income for the month, a second salary.
In your opinion, is this a realistic approach? Is it possible to become a trader with the ability to trade using that kind of criteria, in this manner? Assuming that you also have attended a good course at the Unger Academy, that you have mastered the subject, that you've used all the necessary tools, is it possible to achieve this kind of success, in your opinion, Andrea?
No, not another income because income from trading is absolutely not constant. An equity line that rises at a 45° angle only exists in fairy tales. In trading, in the medium-long term, if you work well, you are in profit, but you aren't in profit every month. There are months at a loss, if not years at a loss, and so if you’re ready to bear that, well, at that point it's fine.
You mentioned the Unger Academy. You’ll never be taught how to play trader for two hours each evening at Unger Academy. If anything, you're taught what and how to study during those two hours in order to learn how to build a trading infrastructure that can then work 12 hours or 24 hours a day for you, in parallel, automatically, which is quite different. But you're dedicating two hours a day to prepare that. A bit like if you were building your own spaceship and not jumping from one planet to another on some site.
But in any case, a fixed salary or a side hustle or whatever, no, that doesn't work that way because... Even if you don't want to believe me, because I am the last to appear, looking at the big investment funds, the big international investors, the ones with billions of dollars, if you look at any historical track record of these funds, you'll see that they have extended periods of losses. The curve has been going up and to the right since the start, but the path is not straight, the path is jagged and one must be prepared for this. The path is jagged and thank goodness it's like this, think about it.
If I aim at a second income and don't accept to lose money, then it's better that I don't do it. If, on the other hand, the loss doesn’t bother me, if I lose a month, 2, 3 times a year and I don't care because I know that in any case in 10 years' time, I'll have earned money, and perhaps even a lot, then it's okay. Do it, do what you think is right.
But if you're going for that because you need the extra money and you can't afford to lose, then don’t do it. Absolutely step away, it's not Candyland. It’s a job like any other with its costs (you know, the losses) and profits. Even the corner store may close its doors because it can no longer afford to keep it open due to the lack of customers. The same can happen to the trader who no longer earns for a long time and then decides to stop trading.
Before going towards the final remarks, Andrea, for those who responsibly prefer consistent results to stratospheric results (which as you can imagine, of course, are difficult, as you said, to achieve if not impossible), would you suggest they focus on certain instruments over others? Is it better to lean on stocks instead of bonds? On currencies instead of derivatives? In addition, is there also a sort of ranking with regards to which instrument achieves the best consistent results?
No, not really. Always assuming that a person decides based on their knowledge of the tool, at which point they can dose it. You can say, "I want to put sugar or Splenda in my coffee.” You're never going to put the same amount, obviously. You say "I'll put a packet of Splenda or one spoon of sugar." The same story here. I can buy more of a stock and buy less of a derivative. But if I know what will happen, I don't have a real ranking. Then afterwards you can decide to exploit trading models that perhaps have less earning potential but a smaller risk of loss.
In other words, a model of asset allocation, of rotational investment on some stocks or ETFs, could lead to "softer" trends than a portfolio of systems on futures. That can happen! So, I could say: if you don't want to kill yourself by studying futures and want to study only some rotational allocation models, think about models that put together stocks… I'd suggest Nasdaq because they are dynamic and are primarily linked to market trends, and ETFs that represent indexes... Mixing ETFs with stocks is already a way to calm down the fluctuations of the instruments.
…You need to find a balance…
There are many types of models and this could be the solution for those who want to have less headaches as possible looking at the account balance at the end of the day. For the others, no, because I repeat, it depends on the strategy. I can drive a Ferrari and if I want to go slower, I just have to take my foot off the pedal, you know, if I'm afraid of going too fast. If, on the other hand, I want to go faster, I must press the pedal a little more and go. Don’t blame the Ferrari, but yourself according to how much you decide to press that pedal.
Before we say goodbye, here's a last service announcement. For all the people who'd like to delve deeper into the concepts we have explored during our conversation, you can order Andrea Unger's book, "The Unger Method," which is available on the Unger Academy website. You'll receive the book at your doorstep. It's free, and you only cover the shipping costs: so happy reading, everybody!
We'll help you map out a plan to fix the problems in your trading and get you to the next level. Answer a few questions on our application and then choose a time that works for you.
BOOK YOUR FREE STRATEGY SESSION NOW >>Andrea Unger here and I help retail traders to improve their trading, scientifically. I went from being a cog in the machine in a multinational company to the only 4-Time World Trading Champion in a little more than 10 years.
I've been a professional trader since 2001 and in 2008 I became World Champion using just 4 automated trading systems.
In 2015 I founded Unger Academy, where I teach my method of developing effecting trading strategies: a scientific, replicable and universal method, based on numbers and statistics, not hunches, which led me and my students to become Champions again and again.
Now I'm here to help you learn how to develop your own strategies, autonomously. This channel will help you improve your trading, know the markets better, and apply the scientific method to financial markets.
Becoming a trader is harder than you think, but if you have passion, will, and sufficient capital, you'll learn how to code and develop effective strategies, manage risk, and diversify a portfolio of trading systems to greatly improve your chances of becoming successful.
