When you’ve spent decades in the markets, like I have, you learn some lessons the hard way.
Looking back, I think the biggest thing I wish I knew when I started was the importance of patience — and knowing when to step back.
The Trap of Over-Trading
When I first started, I went at it like a madman, trading everything that caught my eye. Back then, it felt like the more trades I made, the more successful I’d be. I’d spend hours jumping in and out of positions, only to realize at the end of the day that all I had to show for it was… 28 cents.
Maybe you can relate.
Think about that — hours of work, countless trades, and just a few pennies. I started to see the problem: too much action, not enough strategy.
That’s when I realized the power of cherry-picking my trades— focusing only on the high-probability setups that really make a difference.
Why scatter your energy across mediocre opportunities when one good trade can make your entire week?
Patience Is More Than a Virtue — It’s a Strategy
But I wasn’t unique.
Most new traders go in guns blazing, thinking every tick in the market is a signal to trade.
I get it; you’re learning new skills and you’re eager to flex those new muscles. Sometimes the excitement can be hard to resist.
But here’s the truth: you don’t need to trade every single day. In fact, some of the best trades come when you wait for the market to come to you.
Patience isn’t just about waiting — it’s about the mental strength and discipline behind knowing when to pounce… and when to sit on your hands.
So many times, you just need to let the noise settle so you can act with clarity. For me, patience has turned into one of the most valuable tools in my trading tool kit.
Understanding Risk and Hedging Wisely
Another lesson I’ve learned is how to handle risk without letting the market “peel your face off.”
Nobody likes to lose, but that doesn’t mean you should avoid risk altogether. Instead, I’ve learned to hedge my positions to protect myself during market downturns.
For instance, I might buy puts on indices like SPY or QQQ to offset potential losses in my stock positions in case the market turns south.
It’s like insurance — you hope you won’t need it, but it’s there if you do. And if the market doesn’t tank? Sure, I lose the premium I paid for the puts, but I’d rather sleep easy knowing I’m covered.
Focus on the Gems
Once you find a stock that works for you, keep trading it. Over the years, I’ve come across some real diamonds in the rough.
Take Byrna (BYRN) as an example. I first bought it at $4.75, and I’ve traded it multiple times since, each time making money as it climbed toward my $25+ target.
Finding those opportunities — and sticking with them — is how you build consistency.
Final Thoughts
If I could go back and give myself one piece of advice, it’d be this: Slow down. Be patient.
Focus on quality over quantity. Trading isn’t about winning every minute — it’s about staying in the game long enough to let the wins pile up over time.
And remember, the market will always be there tomorrow. Trade when the conditions are right, not when your excitement gets the better of you.
— Geof Smith
P.S. I caled the epic gold rally late last year. And it’s been paying off ever since. Now I’m sharing my big prediction for 2025 right here!
