How Running Has Helped Me Become a Better Trader

Ever been stuck in the slumps? Yeah, me too.


For the past couple of months I’ve felt like the man in this picture. When I ran, I was just going through the motions-just trying to finish my work out. Sure, there were some good days here and there, but I knew that I wasn’t reaching my potential as a runner. I also wasn’t feeling the happiness and energy I usually felt after a good run. I approached my coach, and he gave me some steps to help me out of this rut I’d gotten myself into. However, I realized that these steps wouldn’t just help me in my running; they could help me with my profession, my social life, and (of course) my trading.

  1. Set my sights higher than just the next race

I know you’ve all probably heard more than your fair share of motivational speeches centered on goal setting, but honestly there is something about a goal that just helps you focus on improvement. When I stopped and focused on what I was going to accomplish the racing season, I saw each race as a step to reaching my personal record. When trading, you have to look further down the road than your next trade.   What do you want to accomplish today?  This week?  This month? You have to set your sights higher than a single trade and discover what you can do to accomplish your personal best.

  1. Stop running so much

What? To improve running you need to stop running? To a degree, yes. Running daily is very important, but I always reserve one day of the week to resting and recovery. Without this break, I would end up running less during the week because my legs would become overworked. Sometimes, you need a little break from trading. Don’t spend all day with your eyes glued to the candles on your screen-go for a run or something 😉

  1. Track your mileage

I always track my mileage – along with how much sleep I get, and the food I eat. This not only helps me feel good throughout the season, but I can look back and see when I was struggling or doing good. By tracking my progress this way I can see what made me sick or tired and what made me feel good and energized. Track your trades. Notice what setups work for you, and what triggers an unwanted emotional response. Besides, whether your profitable or not, it always feels good to look back and see the progress you’re making.

  1. Mix it up

Contrary to what some may imagine of a typical cross country runner, I actually lift a lot weights. My core and upper body strength is just as important as having strong legs when I run. Sometimes, at the end of a race, if your legs feel like they don’t have the energy you can pump your arms, and ,crazily enough, your legs will follow! When you’re trading you need to be prepared for different market events. Learn to trade in long summer doldrums, as well as high votility markets.

  1. Change your attitude

One of my pet peeves is when I go to a race, and hear runners complain that they have to run. Don’t you run because you like it? If you don’t like it, then why are you here running?! I like feeling strong, the runner’s high, and swelling accomplishment that fills you up and makes you feel like floating. What do you like about trading? If you can’t answer this question, then you need to find out why you’re trading. Identifying why you’re trading will help get you through the slumps.

I hope if you’re feeling a little bit stuck in a rut in your trading, that you can try these out. Make trading enjoyable again, and go make some pips.

Happy Trading!

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Demo Accounts Hold You Responsible

“Genius is one percent inspiration and ninety-nine percent perspiration.” -Thomas Edison

Hello Traders,

Take a look at this equity curve from one of Apiary’s demo accounts:

Screen Shot 2015-09-23 at 9.52.03 AM

What do you see?

I see someone with a mental block. However, I also see that they kept trying. Go back and take a look at that quote I’m sure most of you just skimmed over. Perspiration (i.e. hard work) is the key to becoming “genius.” This definitely applies to trading. Apiary Fund’s demo accounts offer a chance to become a genius at trading.  It gives you real life trading scenarios and demands without any of the pressure of trading real money. This teaches you to think and develop strategy instead of relying on luck. Luck will run out eventually, and it will be necessary to develop a strategy.

If you haven’t guessed by now, this is one of my demo accounts. Personally, I like to use a consolidation breakout strategy, and when I use it right it produces a nice equity curve. Using this, or any strategy, requires discipline and hard work. A friend gave me 7 steps to consider before placing any trade.

  1. Proper preparation
  2. Hard Work
  3. Patience
  4. A detailed plan before every trade
  5. Discipline
  6. Communication
  7. Replaying important trades

While each of these steps may mean something different to each of you, everyone could benefit by considering them before entering a trade.  With each of my big losing trades, I missed applying at least one of these seven steps.  My rebounding wins happened because I chose to follow these steps. I’ve learned that I can’t control what happens with a trade after I’ve placed it, but I can control what I do before placing it. My 6 biggest losing trades in this account are responsible for over half of the total equity lost. That’s out of 50 losing trades! Whether I wasn’t patient enough to wait for the right setup, or I didn’t have an exit plan, some step was overlooked. That is something I CAN fix. There is nothing wrong with losing a trade, that’s just part of the game. What’s important is that I follow my trade plan and stick to it-no matter the temptation to jump into a trade without proper preparation. I can handle the other 44 losses. They wouldn’t amount to much because I followed an exit strategy in each of them.

I’ll end with one of my favorite quotes, and hopefully you can all apply it to your trading:

Let me tell you something you already know. The world ain’t all sunshine and rainbows. It’s a very mean and nasty place, and I don’t care how tough you are, it will beat you to your knees and keep you there permanently if you let it. You, me, or nobody is gonna hit as hard as life. But it ain’t about how hard you hit. It’s about how hard you can get hit and keep moving forward; how much you can take and keep moving forward. That’s how winning is done! Now, if you know what you’re worth, then go out and get what you’re worth. But you gotta be willing to take the hits, and not pointing fingers saying you ain’t where you wanna be because of him, or her, or anybody. Cowards do that and that ain’t you. You’re better than that!” -Rocky Balboa

Happy Trading!

Jacob Johnson

Trader Support

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What Makes a Trader Successful?

How would you answer this question?  What is it that makes a trader successful? Is there one special quality they need, one bit of knowledge they need to learn, one tool that they could use to make them successful?  Or maybe, it’s just luck.  They are lucky, and now they are successful!

Well, the truth is, there is no one simple thing that can be given to immediately make a trader successful.  Luck may help sometimes, but it’s not a reliable process that we can count on.  The only consistent and proven way that makes a trader successful is by the process of hard work.  Nothing will be given to you without you putting the time and effort into your trading, and even then it may still take a while.  Time and hard work will eventually place you in a position where you can be successful.  The question is – are you willing to put in the time and effort needed to become a successful trader?

Successful traders have spent the time to learn how to trade, and then used that knowledge to create a trading plan.  Most have written their rules down, so they know exactly what to do to enter a trade and to exit a trade.  If I asked everyone to send me their written trading plan (please don’t, I don’t have enough time to read them), most traders couldn’t because they either don’t have one or haven’t taken the time to make it real by putting it down on paper.  If you don’t have a well-defined and written trading plan, then you are not ready to become a successful trader.  This is something that takes time and hard work.  Again, I ask – are you willing to put the time and effort to become successful?

The development of a trading plan does not need to be complicated. In fact, it should be as simple as possible.  Let me suggest a few things that you should begin to develop your trading plan.

  1. Define the “why” for your trading.  I know you want to make money but the “why” is more than just money, it is the reason behind your need for money.
  2. Define your risk rules.  You need to identify your “sweet spot” for how much you are willing to risk.  If you risk too much you will become fearful and if you don’t risk enough you will feel unsatisfied.  This should include how much risk you want to take in each trade, as well as how to calculate your position size.
  3. Define your entry and exit rules.  I will put this into two categories.  Setups and triggers.  The setup is what you see on the chart to know a trade is about to happen while a trigger is what you see on the chart that tells you it’s time to buy or sell.
  4. Define your analysis process. This is what you are going to do to analyze your trades after they are done.  Do this on a daily, weekly, and monthly basis to make sure your trading plan is working the way you want.

Ok, so that’s it! (Well, at least some of it) If you want to be successful then create a well-defined and written trading plan.  Do not leave your success to luck or chance or anything else.  It’s up to you – now go and put the time and effort into your success!  Be that successful trader you want to be!

Happy Trading!

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Breaking the Trading Psychology Barrier: Fight or Flight

The Apiary Fund is helping people break the trading psychology barriers that are holding them back from success in the financial markets.  Each week we’re focusing on a different psychological barrier to help you better see it and beat it!

Today’s obstacle is the psychological phenomenon called fight or flight!

When faced with adversity, we all have an instinctive response:  some confront the challenge head-on while others run for hills. In psychology, it’s called fight or flight, and sometimes our instinctive response comes at odds with rational decision making in the financial markets.

Emotional traders will often allow their pre-programmed response to make the tough decisions.  Do you close the position?  Do you keep it open?  Do you double down?  Do you quit trading altogether?

The problem with emotional triggers is timing – the emotion does not always manifest itself at the right time.  So the instinctual response to the emotion of adversity is often ill-timed.

It would be nice if the emotional trigger and the right time to make a decision always correlated…  But they don’t, so the trick is to make buy and sell decisions when it’s a rational time to make the decision – not when the emotion is tugging you into a response.

One approach traders use to overcome the instinctive response of fight or flight is to identify when the emotions start tugging on the instincts.  You must learn to recognize it by documenting or making note of every situation where the emotion starts to express itself.

Once you recognize the emotion, then you can start looking for patterns.  At first you may only recognize the pattern as a losing trade, but you need to dig deeper if you can.  Is it a pattern to the size of the loss?  Or the duration of the loss?  Is it the opinion of another trader?  Is it CNBC?  Understanding the patterns that trigger the emotion will allow you to plan your trade better.

The final step is to make pre-defined decision points before you enter a trade.  In this way, you’ll know when to make a decision and when not to, irrespective of how you feel.  You’ll begin to develop confidence that these points work within boundaries of your natural instincts. It will save you from making a decision based on emotions and it will help you be more rational in your trading.

Stay tuned for the next trading psychology barrier:  Pleasure or Pain.

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Apiary Fund – Breaking the Trading Psychology Barriers

There are three obstacles Apiary Fund traders must overcome in order to get funded: trading knowledge, trading skill, and trading psychology. The toughest of these is trading psychology.

The next few Apiary Fund blog posts will focus on a different barrier we have in our trading psychology and present ways to break the barrier!

Trading Psychology Barrier:  Getting Something for Nothing

Most people like the idea of trading currencies because of the vast fortunes you can make with very little effort. Sadly, it’s not that easy. Trading currencies requires work – a lot it.  You must spend time learning and developing your skill. Like anything that requires skill, such as sports, music, or professional occupation, you should not expect to just walk in and experience instant success. The desire to make something from nothing leads to speculative behavior.  Speculative behavior leads to financial ruin.

Breaking the Trading Psychology Barrier:  Commitment.

Breaking the trading psychology barrier of getting something for nothing is as simple as making a commitment.

The usual excuse for the uncommitted is that:

–       “There’s something ‘better’ around the corner” – or –

–       “There’s no clear evidence of a win with what I’m doing.”

Modern psychology will tell you that ‘WHAT’ you commit to is secondary to ‘HOW’ you commit to it.  It is ‘how’ you commit to trading that will make you successful. Only the smallest part of committing is a passive process that evaluates whether or not something will work.  The #1 factor that will make the choice to trade currencies successful or not is what work you put into it.

Stay tuned for tips on the next trading psychology barrier:  Fight or Flight.

Happy Trading!

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Apiary Fund Traders Manage Risk on the Markets Darkest Day

August 24th will go down as a dark day in market history as the Dow Jones Industrials dropped over 1000 points in early trading.  Days like this bring an ominous air to the hive.

The first profit and loss report was run early Monday morning.  The Dow was just recovering from a 1000-point opening plunge and tensions were tighter than the e-string on a violin.   The seconds seemed like hours while the server churned out the calculation that would give the bottom line for the fund – how many losses, how many gains, and is the fund up or down…

The first number to show up was profits: $33,638.

Next, the losses:  $5,196.

Winners were beating losers by a 5:1 ratio; the early read on profits was nearly 3%.   Tension turned to pure exhilaration as we started going through the detailed report.

The traders here at Apiary Fund are amazing.

I always tell people that the risk management system is for safety and learning.  Yes, it’s true, Apiary Funds money is kept safe by the program that constantly monitors accounts and makes the call many of us are too timid to make – cut the losing trade.   But performance on days like this cannot be attributed to the fail stop of the risk management system, but to the skill our traders have developed as they work toward funding.

The Apiary Fund risk management system keeps the fund safe, but it’s more than that. It’s teaching traders how to manage risk in the tsunami of market disasters.

As good as the numbers were in that first report of the day, what was an even greater accomplishment was the fact that not a single funded trader had been stopped out by the risk management system.

Again, I repeat.  The Apiary Fund Traders are amazing!

Keep up the good work, and happy trading!

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20 Pips Equals Your Success

Ever dream of being that one investor? The one who predicts market events before anybody else knows they’re coming, and gets away with millions of dollars fitting nicely in your pocket? Well, it might be hard to stuff that much money your pockets… but I’m sure you would have no trouble finding a nice safe place to store your millions. Wouldn’t it feel great to make it on the list of legendary traders known for their cunning and incredible returns?

1929: Jesse Livermore shorted the stock market (predicting the crash) and made $100 million.

1987: Paul Tudor Jones shorted the stock market (predicting Black Monday), making an estimated $100 million.

The 1980s (after Black Monday): Andy Krieger shorted the Kiwi (predicting it was highly overvalued) and made $300 million.

1992: George Soros shorted the British pound, making $1 billion dollars (meanwhile Stanley Druckenmiller invested in the german mark and made an additional $1 billion for Soro’s Quantum fund)

2000: John Templeton made $80 million in a week shorting the Dot-Com bubble.

2003: Andrew Hall went long (like, 5 years long) on oil and made enough to land a $100 million dollar bonus.

2007: John Paulson and Kyle Bass both made $3-4 billion shorting subprime mortgages and mortgage-backed securities.

2009: David Tepper went long on banks (predicting they would recover from the financial crisis) and made $7 billion.

Of course, while some take opportunities in the market to make millions, you have to realize the enormous risk behind these trades. As investor Spidey-man would say, ‘With great returns comes risk of great losses.’ For example: Yasuo Hamanaka lost $2.5 billion shorting copper, Brian Hunter lost $6.5 billion in natural gas futures, and Jerome Kerviel lost an incredible $7.1 billion in European futures. Just this last May, China’s richest man lost $15 billion when his company shares plummeted. Ouch – somebody didn’t have their stops on!

The difference between us and them is as simple as a couple of zero’s. Say you make 20 pips with one lot, while somebody else makes 20 pips with 100 lots. You both made 20 pips, but the one with 100 lots made a lot more money. Honestly, it all depends on how much money you put into the trade. The more you practice hitting your 20 pips a day, the more comfortable you’ll become trading in the market. The more comfortable you become in the market, the more money you’ll invest in it. The more money you invest, the more money you’ll make (as long as you’re smart about it). Then, you’ll be hitting your daily 20 pips with 100 lots and making a lot more zeros.

Happy Trading!

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What About Benjamins?

Born in Boston on January 17, 1706 was the tenth son of a soap maker. He was known as Benjamin Franklin, and not only did he contribute to the shaping of science and history but his face graces every $100 bill that’s been printed since 1914. How does our dear friend Ben measure up to his treasured namesake, the $100?

Benjamin (Franklin) Benjamin ($100)
-Born on January 17, 1706 in Boston, MA -The version we know (with Ben’s face) was born in 1914, when Reserve Banks were established in 12 locations through the U.S.
-Alias: “silence dogood” -Alias: “c-note”
-Spent time abroad as an ambassador in both England and Paris -About 2/3 are in circulation outside the U.S.
-Invented a type of oven, swimfins, and bifocals -It costs 12.5 cents to produce
-Apprenticed at, worked at, ran, and owned a print shop -Printed in Washington D.C. and Fort Worth, Texas
-In 2009, one of the only 1733 original printed copies known to exist of his ‘Poor Richard’ Almanac was sold to an anonymous bidder for $556,500 -When the new version of the bill came out in 2013, the bill with serial number ‘1’ is estimated to be worth somewhere between $10,000 to $20,000
-Lived for 84 years (died April 17, 1790) -Avg lifespan is 90 months (~7.5 year)


One more thing you might not have known about Benjamin Franklin. His scientific and financial savvy (along with his good advice) inspired Apiary Fund’s Benjamin Formula. A formula that can help you determine whether or not to take a trade as well as how risky your trade will be. Pretty neat, huh? So follow the example of Benjamin Franklin while you’re trying to make your benjamins today!

“Well done is better than well said.” -Benjamin Franklin

Happy Trading!

For more information on the Benjamin Formula (not the Benjamin Graham formula) click here.

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Why Are Commodity Prices Falling?

Commodity prices are falling. Fast. But why are commodity prices falling if they’re already at five year lows?


It’s not unusual to see seasonal downswings in commodity prices during the summer months, but the magnitude of this past week’s move is so broad that it’s not seasonal but macroeconomic factors leading the charge.

The movement clearly illustrates the relationship between the dollar, interest rates, and commodity prices. Interest rates are increasing.  Dollar is strengthening. Commodity prices are dropping.

The theory behind the movement is that when the Fed “prints money,” the money flows into commodities and pushes prices up – and alternatively prices fall when money becomes scarce.  But what, exactly, is the mechanism that causes this relationship to exist?

Increasing interest rates decreases the price of commodities in four ways:

  1. It increases the pace at which commodities are produced by increasing the incentive for extraction today rather than tomorrow.
  2. It decreases the producer’s desire to carry inventories.  Storage costs increase.
  3. Institutional investors shift investment out of commodities (high risk) and into treasury bills (low risk).
  4. Strengthens the domestic currency, which, in effect, reduces the cost of globally traded commodities.

Right now, monetary tightening is widely anticipated in the US, with the FOMC signaling that they will likely raise short-term interest rates sometime this year – most likely September. It’s not seasonality or an actual change, but the expectation of a rate increase that’s pushing commodity prices lower.

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Currency and Your Wealth

Eastern Europe and the old Soviet bloc during the early 90’s is a perfect example of what happens with extreme fluctuation in currency valuation.

Hungarian ForintDuring that time, there was a great interest in the value of currency.  Everyone, from the butcher to the beggar, was talking about money. I recall walking down the streets of Budapest when a beggar asked for some money to buy bread.  Having been taught by a mom who insisted I help a person in need, I reached in my pocket, pulled out some Hungarian forint, and placed them it in her hand.

I will always remember what happened next.

She looked at the coins, and in complete disgust, spat in her hand and tossed the coins in the street while she murmured some vulgarity about the “worthless” government.

At the time, Hungary was suffering from hyperinflation – a condition where the price of goods and service steadily increased while the value of the Hungarian forint dropped. Nobody wanted Forint because the longer you held it the less it was worth!

There is a great lesson in this…  Storing wealth in currency is a risk.  Yes, you’re parents always taught you to open a bank account and save your money.  While most of the time that is a good practice, there are times when a currency’s value changes.

Wealth is something we’d all like to build.  It is something that we’d like to save once we acquire it.  Wealth is stored in different ways, such as a savings account at the bank, but how you store wealth is just as important as acquiring it because contrary to popular belief, money is not free from risk.

In Hungary, the value of the currency dropped – nobody wanted forint – and so any wealth stored in the form of savings in a bank account was destroyed.

There was an alternative, however; German marks.  While the Hungarian Forint was dropping the German Mark was going up!  Anyone who stored their wealth in German Marks, not only preserved their wealth but expanded it!

Hopefully with this example, you can see how important an understanding of currency is to your wealth.  If you want to be wealthy, you have a couple of hurdles you have to overcome…  First is how to create it, and second is how to store it.  Both are easy to overcome if you understand how currency works and the Apiary Fund is here to help you get over those hurdles!

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