Most traders lose money consistently.

A study of Brazilian futures traders found that over 97% of day traders lost money over 300 days.

Another study conducted by the U.S. Securities and Exchange Commission (SEC), found that 70% of traders lose money every quarter on average and typically lose all their money within 12 months.

I’m a very rare exception. In fact, while beta testing my forex strategy I saw a 100% win-rate… a perfect 13 for 13 trades.

But what makes me the exception has little to do with talent or luck.

Instead, it has to do with the fact that I focus on the things that most traders find boring or tedious.

If you focus on the same things I do, then it’ll greatly increase your odds of also being a consistently successful trader…

Avoid Doing What Most Traders Do

My approach to cracking the code on trading is simple.

If most traders lose money, then I want to avoid doing what most traders do. Most traders often take many trades almost every day.

They also focus almost all their energy on learning to read a price chart or on how to pick a good stock, cryptocurrency, or whatever else they’re interested in trading.

And while I do believe that learning how to read the market is a crucial skill, it isn’t any more important than being an expert on risk management.

The problem is that risk management is boring. Nobody wants to spend time on it.

Most traders think that if they can learn to predict the market, then they’ll make some money. But this just isn’t true and the statistics back me up.

Furthermore, when you take a bunch of trades, you’re going to bury yourself in fees and commission costs. It’s far better to trade less frequently and to focus on high-quality trades instead.

On average, I only take on one to two trades a week, which means I have to make those trades count.

That’s why I focus so much on good risk management.

Free Trading Resources Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just click here to check it out.

Three Steps to Follow on a Trade

Yesterday, I covered the technical analysis behind my most recent forex trade on the U.S. dollar and Canadian dollar currency pair (USD/CAD).

Jeff Clark Alliance members received my trade alert on October 5. By October 11, we were able to exit the trade for a great gain. But a lot happened between receiving the trade alert and exiting the position completely.

You see, on every trade I like to follow a simple method. Here’s how it works:

Step 1: Reduce Risk

• As a trade develops favorably, I’ll look for opportunities to reduce risk. This involves raising the stop loss for the trade.

• This ensures that if there is a loss taken on a trade, then it’s greatly mitigated.

Step 2: Eliminate Risk

• As the trade moves deeper into the money, there’s almost always an opportunity to eliminate any remaining risk.

• This is done by either moving the stop loss to the breakeven point, taking partial profits off the table, or a combination of the two.

Step 3: Protect Open Profits

• At this stage of my risk management strategy, the trade should be quite profitable. The goal now should be to maximize the potential gains that are left in the trade.

• This is the stage where I’ll typically use a trailing stop loss and continue to take partial profits off the table.

My three-stage risk management method does a great job of keeping a trader disciplined throughout the lifetime of a trade.

The focus is first on protecting any potential downside on the trade.

After there’s no more risk – and the trade becomes a free ride – the focus then shifts to maximizing profits.

I followed these steps on the recent USD/CAD trade and in just one day I was able to eliminate any risk on the trade.

Subscribers were also instructed to take partial profits at the same time. This meant we could let the remaining position run (a “free ride”) without worrying about losing money.

And that, my friends, is the key to working toward consistent success as a trader.

Ultimately, this risk management strategy – combined with my view on the markets – allowed us to walk away with $1,900 in less than six days on the trade.

Happy trading,

Imre Gams
Analyst, Market Minute

P.S. After weeks of working on my new forex trading service, I’m excited to announce it launches this Saturday! Click right here to find out more.

Reader Mailbag

How has your trading method changed from when you first started?

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com.