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Walter Peters – Small Account Big Profit

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Most Traders Never Understand Trade-Level Compounding (and Certainly Don’t Use It)

This is aggressive trading.

This is putting it on the line.

This is compounding at the trade level… something very few traders understand, much less attempt.

But here’s why I believe it’s worth it:

“Some of the world’s greatest feats were accomplished by people not smart enough to know they were impossible.”

                                                – Doug Larson 

Plenty O’ people will tell you it’s a “pipe dream” or a bad idea to try to make $99,000 over 300 trades (which is exactly what I’m going to try to do, as you’ll see in a minute…)

I think the naysayers are wrong.

Admittedly, I would never trade my only trading stake this way.

It makes sense to break off a little risk capital to trade hyper-aggressively.

The majority of my trading capital grows via “normal compounding” (the slow way)… it only makes sense to do this with a small sub-account.

Because Risk/Reward is the name of the trading game.

Growing an account quickly will ALWAYS have drawbacks.

It is possible to pump up the equity peaks (the lovely parts of your equity curve) without plunging too deep into terrible equity lows…

Higher Rewards Require a Different Type of Risk Management

Take a look at the equity curve chart below:

These trades are simulated for a 43% win rate strategy, with a 2:1 reward-to-risk ratio.

The risk per trade is 5%, which is crazy (of course, because every goo-roo trader harps on the “risk 2% per trade”)…

After 322 trades, this puny $1000 account hits $109,622 – which is great.

This is what happens when you trade an o.k. trading system with 5% risk per trade and compound the account.

But the chart below is even more impressive:

In this chart you see the exact same trades, exact same system, but instead of compounding at the account level, this is compounding at the trade level.

This lil ‘ol $1000 account ramps up to $900,000 in this simulation…. even though they are the same trades, the same sequence of winners and losers.

Everything is the same except for the risk management rules.

The Money Is Made During The Losing Streaks

It’s fun to look at the hypothetical equity curves and salivate over the ferraris you can afford once your trading account hits that level….BUT

The reality is most traders give up before they hit the promised land...

Which is too bad.

If you don’t trade through the drawdowns, you’ll never hit the new equity highs.

Which is why trading psychology is a critical component of this course.

To grow an account quickly, you must deal with the losing streaks. These are the silent “trader killers.”

Most traders throw in the towel long before they hit the sweet, sweet equity highs.

Here’s What You’re Getting…

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Walter Peters – Small Account Big Profit
Walter Peters – Small Account Big Profit
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