These Successful traders strategies are based on the true story of a Japanese Trader who turned $15K into $150,000,000: A Japanese trader became famous for making over 17 million dollars in under 10 minutes due to a mispricing error. This Japanese trade refer to as BNF, also profited big time during a period of time of volatility in the markets. Now many people thought, he just got lucky but over an 8-year time, he turns 15K dollars into 150 million dollars. This Japanese trader made a lot of money in bear markets. However, his claim to fame was when he took advantage of trade. When a trader working for Mizuho Securities made a fat finger error. The trader at Mizuho Securities tried to sell 10600 shares at 1 YEN per share in a recruiting company.
The trader actually had intended to sell one share at 610000 YEN by the time this trader realized his mistake he couldn’t cancel the trade and traders like BNF pounced and brought as many shares as he could at 1 YEN per share. At the end of the trading, session BNF ended up with a profit of over 17 million dollars due to this clerical error. Now even though this trade netted him a lot of profits. This is only a small portion of the 150 million dollars in that he has made in his trading career.
BNF Successful traders strategies
Now let’s go into his trading approach and how you can learn to trade like him. BNF trading strategy is pretty simple. He likes to buy stocks when they have fallen a lot and are out of favor with investors. It’s kind of like a bottom-fishing approach but he doesn’t look at a company’s fundamentals to determine which company is undervalued, rather he uses technical analysis and charts to determine when the right time is to get into these beaten-down stocks. His trading style is to buy oversold stocks with the aim of profiting from an upward trend change in its price. he’s not a long-term investor but a swing trader who typically holds stocks between two to six days. However, sometimes he would hold it longer than a week depending on what the charts say. He thinks that bear markets are easier to trade because markets tend to have more volatility and offer more trading opportunities.
Now let me give you an example, here’s a chart of the S&P 500 index. Which measures the performance of the top 500 companies in the US stock market between 2007-2009. Now you can see here on the chart, the number of times that the stock market has experienced a surge in prices and particularly the sharp percentage increases in a very short period of time. You can see the stock market trend has been following. You can see that in 4 days it rose 15.7%. Same thing here in 7 days it rose 18.7%, and in 46 days it rose 24%. In 7 days it rose 8.8% and again you can see here 8% and so on. So what are the lessons you can learn from this trader’s mindset and how he thinks about the financial markets?
Let me give you lesson 1. The first lesson is focus and concentration. This trading strategy is to focus deeply and not allow for any distractions. He’s constantly monitoring his 30 to 70 positions in the markets and scanning for opportunities among his 600 to 700 stocks list. By seeing how his positions are performing he can get a sense of market sentiment and trade accordingly.
Lesson number two view trading as a game. BNF views trading as a zero-sum game, where there is a winner and there is a loser. So if you decide to play this game called the stock market or financial market play to win, BNF treats trading like a video game. Where you don’t focus on how much money the game will make you but rather on how you can win the game. Now, too often times we focus on the end result which is how much money we will make or lose on our trades, and not how we can execute this trade to perfection and win the trade. So viewing trading like a game would definitely change your perspective on how to approach your trades.
Lesson number three is do not focus on the results. BNF had an excellent quote when he was interviewed about his trading success. He said that if you care about money too much you cannot successfully trade. Now to him losing 100-1000 dollars can actually feel better than making 6000 dollars. If the losing trade was a good trade and the winning trade was a bad trade. Now the lesson to learn here is to focus on the trading process and follow the trading strategy rather than what the result of the trade is. Now if you have a proven trading strategy it should work over the long term and if it doesn’t then you exit the trade at a small loss.
The last lesson is to live a modest lifestyle. BNF has worth over hundred and fifty million dollars. Like fellow traders, he lives a very modest lifestyle. He doesn’t feel a need to spend money on luxury items. however, he owns his own condo in Tokyo where he trades from, and owns an office building for investment purposes only. Now too oftentimes if you live a luxurious lifestyle, you need to make enough money to support this lifestyle and this would impact your trading decisions.
These BNF Successful traders strategies will be helpful for trading in the stockmarket. Read Also Crypto trading tips for bear markets.