An Introduction to Successful Trading and Investing

Transcription

1 An Introduction to Successful Trading and Investing By Marcus de Maria Stocks and Forex Trader & Creator of the Buffalo Market 1 P a g e

2 Disclaimer: The information presented in this Report is for educational purposes. Any examples used are for educational and illustrative purposes only. Investment Mastery is not a stockbroker, broker dealer, or investment advisors. They are not recommending particular stocks, ETFs, options, forex, CFD or securities of any kind. The names of any firms of stockbroker, stock exchange, financial institutions, financial planners, bookmakers, or financial websites mentioned are for illustrative purposes only. The decision on which company to use if any is at the total discretion of each individual person. It is recommended that you seek a professional licensed broker prior to implementing any investment programme or financial plan. Investment Mastery cannot guarantee any results or investment returns based on the information you receive. You must read and understand the above and be aware of the risks of all trading and investing and be willing to accept them before investing. Trading stocks, options, forex, CFD, spreadbetting or securities has large potential rewards, but also large potential risks. Stock market trading is not appropriate for all investors. Past performance and any examples or testimonials cited is no indication or guarantee of anticipated future results. Individual results will vary and cannot be guaranteed. This report introduces stock market investing and trading and gives you a real overview of what you need to do to be successful. It is designed for people either just starting out and/or those not yet making consistent returns. This report is not designed for people already trading and making consistent returns. If you are in this category, you don t need this book - please help someone else by giving this report to someone who will benefit by learning the foundations of how to make consistent profits. 2 P a g e

3 Please note: If you like what you hear, then at the end of the report we would love to invite you to our one-day event at our trading rooms in North London. It is normally priced at just VAT for eight hours of pure content taught by traders making a living from trading, but we make you a special offer at the end of this report. All our trainers attended the one-day event and are now making quite extraordinary returns on a monthly basis. To find out more, visit: But more about that later. My Trading Journey Hi, Marcus de Maria here. I have been trading and investing since 1999 and have traded in all kinds of market conditions during that time. I now have a team of traders who trade my money for me using the strategies I taught them and last year my account went up by 457 per cent. As a result, I published my book, the Wealth Workout, have been featured in the BBC programme, Money; featured in the Riches DVD series with Duncan Bannatyne and James Caan; spoken on stage with greats like Brian Tracy, Robert Kiyosaki, T.Harv Eker, Tony Robbins and even Donald Trump. It has been quite a journey. But when I first started back in 1999 I literally knew nothing about the stock market I remember sitting with 1,499 other people in a seminar in London where the speaker on stage started to explain what trading stocks was all about. I learned that you could make money when markets go down as well as up and I remember thinking, Wow, that s a great concept. How is it possible to do that? I didn t understand how 3 P a g e

4 but that got me started on a journey that began with me attending a lot of courses, seminars and workshops. For several years I was consistently losing money, and then consistently breaking even, and then I began consistently making money. Now I have gone to the next stage. I train other people to trade my money for me. I have a team of traders in my trading rooms who trade my money, using my strategies. And all of them started off by reading a report like this one. More importantly, they then spent a day with me at our trading rooms in North London. I am hoping you will join us too. What I m saying here is that it took me several years, a lot of time, money and frustration to get where I am now. But you know what? I could have done it 10 times faster. Now it takes me just four months to teach others what took me four years to learn. The key is having the right instructor, who is willing to spend real time and effort with you. Well I am here to do just that for you to get you making consistent returns in just a few months, maybe sooner. It s like me showing you a shortcut that just gets you there faster at a fraction of the time, cost and effort. You see, time is by far the most important element here. Time is our most precious resource and one day, we run out of it. There is no more. So anything we can do to save time is worth it. And the best way I have found to do that is to find someone who is where you want to be. If they are willing to help you and that is a big if then just do what they do to get the results they get. And I bet they took a lot longer getting to where they are now because they didn t have anyone showing them the short cuts. So you will be able to do it faster than they did. This is called modelling success and I am a big fan of this because it saves you so much time and effort. Don t try to do it by yourself. Don t even think about it. Would 4 P a g e

5 you learn to drive a car without an instructor? No way do you know how long it would take to try to figure it out by yourself? And you might never get there! Using an instructor is faster, more fun, and makes success more likely because not only do they know what to do, they can show you what NOT to do. I want you to know something. Something I know to be true. You can do this. I can promise you that we will help you in any way we can. The question is: do you believe it? And that is the only question. If you can answer that question with a yes or are willing to suspend disbelief just for a while then you are in for one hell of a ride. By 2004 so many people were asking me to teach them what I was doing that we decided to start training other people. I ve been training other people for eight years now. So I can put my hand on my heart and say that we really know what works best. Especially for people who are very busy. One thing that people ask me is: why am I willing to share what I know? Well, there are several reasons. One is that the markets are closed at the weekends and that s when I train people. Another is that when I share this knowledge with you, it doesn t negatively affect my trading or my results. They stay the same. If I thought that training you would change my results, I wouldn t do it. An entirely new market I m best known for two things. Firstly for creating or naming an entirely new third market movement, called the Buffalo Market. The Buffalo Market is a sideways market. You ve probably heard of bull markets going up and bear markets going down? But what most people don t know is that 65per cent of the time markets actually go sideways. The second thing I am known for is keeping things simple. People really complicate things. I don t know why. The key here is to keep things simple. If you are ok with that then you are already on the right track. 5 P a g e

6 So before we start, will you give me permission to be your trading instructor and coach? Yes? Because if you do, then I am going to hold you to a higher standard; a higher standard than maybe you even hold yourself. So are you ready? Then let s get started. I m going to begin with the basics, so if you are a beginner right now then this section is for you. If you are already trading but not yet making consistent profits then you might want to skim over this bit. Notice I said skim not skip. Don t just skip this bit skim over it fast to remind yourself why you are doing this. Give yourself that gift. Does trading and investing give us what we want and need? There is a whole list of reasons why I believe it does. But it s not really about me; it s about you. Let s go through the list and see what you think is most important for you. For me it s time. It s so important. It s crucial. We are all so busy in our lives. One strategy we teach takes just 30 minutes a month. Do you have 30 minutes a month? Another strategy we teach takes just two hours a month. Do you have two hours a month? Most people can say they have two hours a month. The most popular one we teach because it makes the most money takes just minutes a day. Again, most people, if they are serious about making money, have minutes a day. 6 P a g e

7 Location is also important because with trading it truly doesn t matter where you are in the world. My brother right now is doing a one-year round the world trip. Guess how he is making his money? Can you guess? By trading? Absolutely! Trading is totally recession proof. Normally when you have properties or business when markets are going down it s not particularly good. In the stock market it s fantastic. Why? Because, unlike business or property, in the stock market you can make money when markets go down. In fact, you can often make money faster that way. I ll be sharing how that is possible with you later. The other aspect I like is that you are in control at all times. Think about this: using an online broker I can exit my trade position with the simple click of a mouse. Click. And four seconds later I ve sold. Try selling a property or a business at the price you want in just four seconds. How long would it take? Weeks to months? In trading we even have something called a Stop Loss which literally does what it says; it stops your losses. Some brokers even offer a guaranteed stop loss which guarantees it will get you out if the price moves down lower. Can you imagine having that in the property market or in business? Imagine having a guaranteed stop loss which allows you to sell your property if the price falls too much. That would be amazing wouldn t it? That s what happens in the stock market. By the way, I want to be very clear. I have a double-digit property portfolio. I also run several businesses. But I have to tell you the stock market is part of the five pillars of wealth: business, your career, the stock market, internet marketing and property. Investing and trading in the stock market is one of them. You have to do it. It s not a question of: do I do it or don t I. You simply have to find out which strategy fits into your lifestyle and then stick to that strategy. 7 P a g e

8 Finally, and I think this is wonderful, the better you get, the more money you make. Some people get it fast. Others take a little longer. It doesn t matter how much time it takes. Even if someone is a slower learner than average, it really doesn t matter. So it might take them a month or two longer than it might take somebody else. What if it took you longer than anyone else? Does it really matter? Because once you get it, you have it for the rest of your life. You can teach your family and specifically your children. By passing this knowledge on you can you can create true inter-generational wealth, which is absolutely fantastic. What is the stock market? So: what is the stock market? Remember, we are looking to keep things simple. The simple answer is, it s a market for stocks. What do you do in this market? You buy and sell. That s right. Let s keep it simple. Imagine the stock market as being a huge cash vault. What is inside that cash vault? I hope you said, cash. Now, what s stopping us from getting into the cash vault? Normally the answer would be a key or a combination. And there would be just one of these to open the vault. But in the stock market this isn t the case. In the stock market there isn t just one combination, there are millions. You have to choose between stocks and shares, Foreign Exchange (Forex or FX), commodities like oil or nickel, precious metals like gold and silver; or maybe you are going to trade the options or futures; or try different brokers like spread betting; and then there are different time frames. You ve got five-minute charts, 10-minute charts, one-hour charts, daily charts or even weekly or monthly charts. Then you have different indicators. There are hundreds of them - you have MACD, Moving Averages, Stochastics, RSI etc. and they all have different settings. The combination of all these is into the hundreds of millions. 8 P a g e

9 As a beginner it can be daunting to know how to make money. My question is: how many of you just want to keep things very simple? That s what I m here to do. To keep it simple so that you don t have to go through what I had to go through back in the nineties when I started. I ve been doing this for a long time. And I ve got to tell you: you don t need to go through everything most people go through. So let s just keep things simple. What if I gave you some very simple concepts that you can apply immediately? The first concept is that there are three market movements, not just one or two. Most people are surprised by this because they believe that the only way to make money is when stocks go up. This is what 99% of people believe and that is what the City wants you to think. They don t want you to know these concepts. Here s one they don t want you to know about: You have as much if not MORE chance of making money than the professionals! Difficult to believe? Let me prove it to you. First reason why we make more money: we can buy whatever stock we want. A normal fund manager whose fund specialises in a sector, say utilities, is forced to stay within that sector no matter what happens, even if it is not making much money. Even if his colleague in the same firm who specialises in technologies is raking in a fortune, the utilities fund manager has to continue investing in water, gas, electricity etc. 9 P a g e

10 We, on the other hand, can invest in any company within any sector we want. Why? Because we (you and me) are not regulated by the Financial Services Authority (FSA) and they are. Second reason why we make more money: we can stay in cash. A normal fund manager s remit is to invest your money. Whether the market is going up, down or sideways, they invest in their specialised sector. They can t just decide one day to not invest and to stay in cash because they weren t sure what the market was doing. No: their brief is to invest your money. Period. We on the other hand, can stay in cash and not invest if we think the markets are behaving strangely and we just want to not be invested. Why? Because we (you and me) are not regulated by the Financial Services Authority (FSA) and they are. Third reason why we make more money: we can sell short. A normal fund manager can do one thing and one thing only: buy. That means that they only make money when markets go up. They don t make you any money when it goes sideways and they lose you money when markets go down. Put another way: they can only make money in one out of three scenarios. Does that sound like good odds to you? We, on the other hand, can sell short and make money when markets go down. We do it every single day here at Investment Mastery. It is totally normal. We want to make money in ALL market directions not just one. Why? Because we (you and me) are not regulated by the Financial Services Authority (FSA) and they are. How does that make you feel? To know you have as much if not more chance of making money than the professionals. Does it give you some confidence to know that because we are small and don t trade other people s money, we have a flexibility 10 P a g e

11 that the City boys just don t have? And therefore, with the right knowledge and support, we can be more successful than them? I bet you didn t know that! The three market movements: Up, Down and Sideways Stock markets: they go up and they go down, but over a long term the direction is always up. You can take a look at the FTSE (Financial Times Stock Exchange) or Dow Jones Index. Over the last 80-odd years, ever since we ve had charts, these indexes have been going up (an index is just the average price of many stocks that make up the index. So for example, the FTSE is made up of 100 stocks, hence the name FTSE100 and the Dow Jones is made up of 30 top stocks). But when you look closely you will see that sometimes the index goes down. For example, you might have heard about the depression in the late 20s and the early 30s. And you will notice that it can also go sideways for long periods of time. That is what is happening right now; in fact if you look at the markets over the last 12 years, you ll see that it has been going sideways. To summarise: there are in fact three market movements not just one. So in reality you should find a way of making money in all three of these market movements, right? So why is it that when you give your money to the professionals in the City, they will invest your money by buying a stock or into an Index? They will make you money if markets go up but, as we have seen, that is only one market movement. What happens when markets go sideways? They don t make you any money. What happens when markets go down? They lose you money. Doesn t it sound strange to you that the professionals can make you money in just one in three scenarios? It s almost like they don t know how to make money in any other market than up. But let 11 P a g e

12 me tell you that you can because you are not regulated in the way they are. More on that later. It hasn t been that long since the internet went mainstream and that s when we began to use an online broker and trade for ourselves. You don t have to buy a seat on an exchange for thousands of dollars; you just switch on the computer in the comfort of your own house, which is absolutely fantastic. Simple? Yes. As easy as it sounds? No. The problem is most investors have never really learned how to invest, but go ahead and buy stocks and shares anyway. It s like hitting 17 and taking your dad s car out for a spin before having any driving lessons, let alone passing the test. No sensible person would do it would they? And yet, they do it every day on the stock market hundreds of thousands of people buy shares without understanding what they are doing. So before starting, do some of what I did - but not everything. What do I mean? Go on a really good course to learn the basics. And avoid the bad courses. I went from course to course not really knowing what a good course was supposed to look like. How can you distinguish the good courses from the bad courses? On our one=day event I hand out a list of 10 questions you MUST ask a course provider before committing yourself. This list would have saved me a lot of money, time and effort I 12 P a g e

13 am talking about tens of thousands of pounds and it is my great pleasure to be able to give you a copy. One such concept that is very important when trading is always using a stop loss. What is a stop loss? Put simply, it stops your losses. It s an electronic order put on your broker account, so the broker will take you out of your trade if the stock goes in the wrong direction at a price you decide in advance. When you are at work, on holiday or wherever, the broker takes you out of the trade automatically. Wouldn t it be good to have one of these things here no matter what happens? Our graduates, people who learn with us, always have a stop loss when they are trading. You don t use it if you are investing in the long term over a longer period because the market can move a lot during that time. But if you are trading, then you MUST always have a stop loss in place. It just makes sense and is a golden rule of trading. Let s say you risk 5% i.e. you place your stop loss 5% below the entry price. Then the maximum you are risking is 5%. It cannot fall below that number. But how high up could it go? 50% or more? Yes, it could. So you see by keeping our losses small and letting our profits run, it ensures that we make money. An example stock There are some companies that have had a fantastic rise in their stock price. Let s say you had invested 1,000 in Dell. Dell was at three cents when it went public and had its IPO (Initial Public Offering). Then it went from three cents to 10 cents, three times the price, so your 1,000 is now worth 3,000. It went from 10 cents to one dollar or 100 cents. Your 1,000 is now worth 30,000. By the way - it did this in half a year. Then it went from one 13 P a g e

14 dollar to more than 100 dollars. Your money is now worth 3,000,000. How long did it take? Four years! Now that really is impressive. People always love to know what the next Dell is. Or Microsoft or Apple. Would you like to know? I would love to be able to tell you, but the truth is I don t know. And nor does anyone else. Plus, we were in a massive bull market, driving the price higher and higher. We might be not in the bull market right now. We might be in the bear market or buffalo market. Does that mean that we can t make money? That s what most people want you to believe you can only make money when markets go up. But that is not true. All you need to do is to recreate the effect using the following formula: 1. Save some of what you earn 2. Invest it using the strategies we teach you 3. Reinvest any profits immediately don t spend it like most people to make your money work harder for you 4. Wait and watch in amazement how quickly it grows The fastest way to make your money grow The fastest way to make your money grow is to NOT spend your profits but instead to reinvest them. By reinvesting you have more money to invest. If you make the same returns now on a larger amount of capital, you make even more money. If you can just reinvest it again without spending it, you are doing what all rich people do: compounding their money. Most people have heard or read about compounding. But I am convinced that most people really don t understand it. I know this because they are not doing it. If they understood it, they would do it; it is that powerful. 14 P a g e

15 Compounding a new way of understanding this powerful concept I am going to explain it in a way you would not have seen before. I am going to explain it and then show you how to speed it up. Massively. Our goal for you is to achieve around 3% a month or more on your investment. So that is around 36% a year or more. Will you be able to do this immediately? Maybe not, but it doesn t take long to start achieving these kinds of returns. Would you be able to start doing it after few months? Absolutely yes. And I know that for sure. But you ve got to believe as well. And you ve got to learn how to do this and then you ve simply got to do it. You need to take control of your own life. You are reading this report, and that already makes you stand out from the crowd as someone who is willing to do what it takes. You see, most people are not. Most people are poor. You do what most people do and you get the same results. You re reading this; that isn t normal. I ve got to tell you most people would not spend time reading this. They wouldn t do that, but they like to complain about their finances a lot. How to dramatically speed up your money making I am hoping that you have at least 2,000 to invest. If not, then I am sure you can get hold of it if it was for the right reasons. That s how wealthy people think by the way. Even if they don t have the money they will do whatever it takes to get hold of it. We are going for 3% a month. So if you invest 2,000 at 3% a month, how long does it take to make your first 100,000? Let s take a look. 15 P a g e

16 INITIAL AMOUNT 2,000 Enter the amount you have to invest % / month 3.0% 1.03 Extra a month 0 This is for demonstration purposes only and does not include any commissions or taxes Enter the amount of money you can comfortably save a month ( 100 is a good start) 0 extra a year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Jan 2,060 2,937 4,188 5,970 8,512 12,137 17,304 24,671 35,176 50,152 71, , , , ,475 Feb 2,122 3,025 4,313 6,150 8,768 12,501 17,823 25,412 36,231 51,656 73, , , , ,339 Mar 2,185 3,116 4,443 6,334 9,031 12,876 18,358 26,174 37,318 53,206 75, , , , ,470 Apr 2,251 3,209 4,576 6,524 9,302 13,262 18,909 26,959 38,437 54,802 78, , , , ,874 May 2,319 3,306 4,713 6,720 9,581 13,660 19,476 27,768 39,590 56,446 80, , , , ,560 Jun 2,388 3,405 4,855 6,921 9,868 14,070 20,060 28,601 40,778 58,140 82, , , , ,537 Jul 2,460 3,507 5,000 7,129 10,164 14,492 20,662 29,459 42,001 59,884 85, , , , ,813 Aug 2,534 3,612 5,150 7,343 10,469 14,927 21,282 30,343 43,261 61,681 87, , , , ,397 Sept 2,610 3,721 5,305 7,563 10,783 15,374 21,920 31,253 44,559 63,531 90, , , , ,299 Oct 2,688 3,832 5,464 7,790 11,107 15,836 22,578 32,191 45,896 65,437 93, , , , ,528 Nov 2,768 3,947 5,628 8,024 11,440 16,311 23,255 33,156 47,273 67,400 96, , , , ,094 Dec 2,852 4,066 5,797 8,265 11,783 16,800 23,953 34,151 48,691 69,422 98, , , , ,007 It took 11 years and one month. And how long does it now take to make another 100,000, so that you have 200,000? Just under two years. Wow: it took 11 years to make your first 100,000 but it only took two years to make your second 100,000! What is going on? This is called compound growth. It means that instead of spending our profits we reinvest them for more growth. That s essentially what compounding is. How long does it take to get from 200,000 to 400,000? Two years. And from 400,000 to 800,000? Two years. And from 800,000 to 1,600,000 well you get the idea. In this way you are doubling your money every two years. Take a look at the bottom right hand side of the sheet how much money do you have at the end of year 15? 409,007. Not bad considering you started off with just 2,000. But I know what some of you are thinking. You don t want to wait 15 years right? Ok, so how would you like to know how to speed up the process? What could you do? Well for a start you could begin with 3,000 instead of 2,000. Does that make a big difference? Let s take a look. 16 P a g e

17 INITIAL AMOUNT 3,000 Enter the amount you have to invest % / month 3% 1.03 Extra a month 100 This is for demonstration purposes only and does not include any commissions or taxes Enter the amount of money you can comfortably save a month ( 100 is a good start) 1200 extra a year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Jan 3,090 5,606 9,192 14,306 21,597 31,992 46,813 67,944 98, , , , , , ,662 Feb 3,183 5,774 9,468 14,735 22,245 32,952 48,217 69, , , , , , , ,002 Mar 3,278 5,947 9,752 15,177 22,912 33,940 49,664 72, , , , , , , ,102 Apr 3,377 6,125 10,045 15,632 23,599 34,958 51,154 74, , , , , , , ,985 May 3,478 6,309 10,346 16,101 24,307 36,007 52,688 76, , , , , , , ,675 Jun 3,582 6,498 10,656 16,585 25,037 37,087 54,269 78, , , , , , , ,195 Jul 3,690 6,693 10,976 17,082 25,788 38,200 55,897 81, , , , , , ,386 1,008,571 Aug 3,800 6,894 11,305 17,595 26,561 39,346 57,574 83, , , , , , ,578 1,038,828 Sept 3,914 7,101 11,644 18,122 27,358 40,526 59,301 86, , , , , , ,405 1,069,993 Oct 4,032 7,314 11,994 18,666 28,179 41,742 61,080 88, , , , , , ,887 1,102,092 Nov 4,153 7,533 12,354 19,226 29,024 42,995 62,913 91, , , , , , ,044 1,135,155 Dec 4,277 7,759 12,724 19,803 29,895 44,284 64,800 94, , , , , , ,895 1,169,210 INITIAL AMOUNT 3,000 Enter the amount you have to invest % / month 3% 1.03 Extra a month 0 This is for demonstration purposes only and does not include any commissions or taxes Enter the amount of money you can comfortably save a month ( 100 is a good start) 0 extra a year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Jan 3,090 4,406 6,281 8,956 12,769 18,205 25,956 37,007 52,763 75, , , , , ,213 Feb 3,183 4,538 6,470 9,224 13,152 18,751 26,735 38,117 54,346 77, , , , , ,509 Mar 3,278 4,674 6,664 9,501 13,546 19,314 27,537 39,261 55,977 79, , , , , ,204 Apr 3,377 4,814 6,864 9,786 13,953 19,893 28,363 40,439 57,656 82, , , , , ,311 May 3,478 4,959 7,070 10,080 14,371 20,490 29,214 41,652 59,386 84, , , , , ,840 Jun 3,582 5,107 7,282 10,382 14,802 21,105 30,090 42,901 61,167 87, , , , , ,805 Jul 3,690 5,261 7,500 10,694 15,246 21,738 30,993 44,188 63,002 89, , , , , ,219 Aug 3,800 5,418 7,725 11,014 15,704 22,390 31,923 45,514 64,892 92, , , , , ,096 Sept 3,914 5,581 7,957 11,345 16,175 23,062 32,880 46,880 66,839 95, , , , , ,449 Oct 4,032 5,748 8,196 11,685 16,660 23,753 33,867 48,286 68,844 98, , , , , ,292 Nov 4,153 5,921 8,442 12,036 17,160 24,466 34,883 49,734 70, , , , , , ,641 Dec 4,277 6,098 8,695 12,397 17,675 25,200 35,929 51,227 73, , , , , , ,510 Yes it does. Massively. It only takes you 10 years to get to 100,000. And instead of 409,000 at the end of 15 years, you now have 613,510. All this for an extra 1,000? I suggest you go find it. 17 P a g e

18 Do you want to know how to speed it up some more? What could you do? How about putting some extra money in every month? As you get paid, you save a little and put it in. Can you save say 100 a month? And will 100 even make much off a difference? Shall we find out? As you can see it has made a huge difference. Now you reach your first 100,000 in just over eight years. And instead of 613,510, you now end up with a whopping 1,169,210. Just to clarify what compounding does for you: you start off with 3,000, add 100 a month and you end up with 1,169,210 alongside everything else you are doing. Because this takes just 20 minutes a day. I bet you are thinking, What if I put more in every month? Good idea, how about an extra 50 something most people can afford. But come off it, would that really make a difference? Let s find out! Wow look at that, instead of 1,169,210, you now have 1,447,060, an extra 280,000. For the sake of an extra 50 a month. What have you spent 50 on recently that has gotten you that kind of a return? INITIAL AMOUNT 3,000 Enter the amount you have to invest % / month 3.0% 1.03 This is for demonstration purposes only and does not include any commissions or taxes Extra a month 150 Enter the amount of money you can comfortably save a month ( 100 is a good start) 1800 extra a year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Jan 3,090 6,206 10,648 16,981 26,011 38,885 57,241 83, , , , , , ,951 1,045,387 Feb 3,183 6,392 10,967 17,491 26,791 40,052 58,959 85, , , , , , ,909 1,076,748 Mar 3,278 6,584 11,296 18,015 27,595 41,254 60,727 88, , , , , , ,527 1,109,051 Apr 3,377 6,781 11,635 18,556 28,423 42,491 62,549 91, , , , , , ,822 1,142,322 May 3,478 6,984 11,984 19,112 29,276 43,766 64,426 93, , , , , , ,817 1,176,592 Jun 3,582 7,194 12,344 19,686 30,154 45,079 66,358 96, , , , , , ,532 1,211,890 Jul 3,690 7,410 12,714 20,276 31,058 46,431 68,349 99, , , , , , ,988 1,248,247 Aug 3,800 7,632 13,095 20,885 31,990 47,824 70, , , , , , , ,207 1,285,694 Sept 3,914 7,861 13,488 21,511 32,950 49,259 72, , , , , , , ,213 1,324,265 Oct 4,032 8,097 13,893 22,156 33,938 50,737 74, , , , , , , ,030 1,363, P a g e

19 Nov 4,153 8,340 14,310 22,821 34,957 52,259 76, , , , , , , ,681 1,404,912 Dec 4,277 8,590 14,739 23,506 36,005 53,826 79, , , , , , ,884 1,013,191 1,447,060 Amazing? Yes; it is called compound growth. Are you starting to see the power of this phenomenon yet? Do you want to know how to go even faster? How about this do you think that if we taught you how to make 3% a month that after a while you might get better at it? Do you think that after a few months you might even be able to make an extra 0.5%? Let me put this into perspective for you we have several people whom we have taught and who have never had a losing month in 14 months of trading; another in 17 months of trading. Some people are averaging 9-10% a month. Others are 14% a month. All we are saying here is instead of 3% a month, 3.5% a month. Not 10%, not 14% but 3.5%. INITIAL AMOUNT 3,000 Enter the amount you have to invest This is for demonstration purposes only and does not include any commissions or taxes % / month 3.5% Extra a month 150 Enter the amount of money you can comfortably save a month ( 100 is a good start) 1800 extra a year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Jan 3,105 6,492 11,610 19,343 31,029 48,686 75, , , , , , ,616 1,415,580 2,140,839 Feb 3,214 6,719 12,016 20,020 32,115 50,390 78, , , , , , ,363 1,465,125 2,215,768 Mar 3,326 6,954 12,437 20,721 33,239 52,154 80, , , , , ,000 1,002,255 1,516,405 2,293,320 Apr 3,443 7,198 12,872 21,446 34,402 53,979 83, , , , , ,170 1,037,334 1,569,479 2,373,586 May 3,563 7,450 13,322 22,197 35,606 55,869 86, , , , , ,151 1,073,641 1,624,411 2,456,661 Jun 3,688 7,710 13,789 22,973 36,852 57,824 89, , , , , ,971 1,111,218 1,681,265 2,542,645 Jul 3,817 7,980 14,271 23,777 38,142 59,848 92, , , , , ,660 1,150,111 1,740,109 2,631,637 Aug 3,950 8,259 14,771 24,610 39,477 61,943 95, , , , , ,248 1,190,365 1,801,013 2,723,744 Sept 4,089 8,549 15,288 25,471 40,859 64,111 99, , , , , ,767 1,232,028 1,864,049 2,819,076 Oct 4,232 8,848 15,823 26,363 42,289 66, , , , , , ,249 1,275,149 1,929,290 2,917,743 Nov 4,380 9,157 16,377 27,285 43,769 68, , , , , , ,727 1,319,779 1,996,815 3,019,864 Dec 4,533 9,478 16,950 28,240 45,301 71, , , , , , ,238 1,365,971 2,066,704 3,125,559 Wow. That extra 0.5% sure makes a huge difference doesn t it. Instead of 1,447,060 you now have 3,125,559. That s more than doubling your money doing exactly the same thing, just getting better at it over time. Do you want more? Take a look at how many years I am talking about. Ever wondered how Warren Buffet managed to do this? Let me tell you. He hasn t been 19 P a g e

20 doing this for 15 years. Or even 25 years. Or 35 years. Or 45 years or even 55 years. The guy has been compounding for more than 60 years now. That chart we have only shows 15 years. So if you want more, all you need to do is wait. Remember that your money doubles every two years and so your 3,125,559 turns into 6,250,000 in just two years. What if you started some of the younger people in your family a little earlier? Who says you have to wait until age 45 to panic over your finances? Yes, that is what everyone else does. But that does not mean that this has to be your strategy. You can do much better than that just by getting the right training. Wow are you inspired now? Isn t compounding the most awesome concept? All you need to do to find out more is to go to and book yourself onto our eight-hour one-day course. How to make money when markets go down by selling short This is a basic concept that all successful traders use but which is not obvious to most people, because we are used to buying low and selling high. The concept of selling short is extremely similar. We are used to buying low and hopefully price goes up and then we sell. And what s in between is called our profit. Did you know in the stock market you can do something called sell short, where hopefully the price goes down and then you buy back? The only difference is that in the first scenario you bought first and then sold it, whereas in this scenario you sell short first and then buy it back. At this point, people get confused because they don t 20 P a g e

21 understand how you can sell something you don t own. The way you do it is: you borrow it from the broker. So the broker gives it to you and then you can sell it in the market, say at 1 and all you need to do as it goes down, say at 50 pence, is to buy back at the lower price. The difference is your profit. The broker doesn t care about the money or profit; they just want their stock back. I realise that for some people this is new so don t worry. You don t need to understand it 100% to start making money with it. And here s why. I can prove it to you. Do you use a mobile phone? You might even have it around you. Pick it up if you can. Have a look at it. Do you use it? The answer is probably yes. Aha. Now, you would never use something if you didn t know exactly how it works, would you? Now tell me exactly how the sound waves from your mouth go into the phone, go into space, bounce back and enable you to talk to somebody on the other side of the world. Explain it to me! Otherwise, don t use it. You might say, I don t need to know it Marcus. It works. That s right. You don t need to know exactly. It works. You buy low, sell high if you think it s going up. If you think it s going down you press the button called sell short. There are only four buttons: buy, sell, sell short and buy back. 1. Buy 2. Sell As you can see, buy and sell go together. Most people know this. 3. Sell short 4. Buy back These are the only two buttons that need to be learned. Don t worry, we cover this in much more detail at our educational workshops. We just want to let you know that this is something that we can do, it is powerful and the truth is that most people just don t do it. 21 P a g e

22 Model Success You can become successful by doing one of three things: 1. Develop your own strategy 2. Model somebody else s proven strategy 3. Get some tricks and tips, or some broker who tells you what to do. Which one do you think you should be doing starting out? The best thing to do is to model another investor s proven strategy. And the goal is to do that until you ve mastered it. Then you might be able to improve it but to start off with chances are you probably want to use what somebody else is using, as long as it is profitable. Do you want to learn how to trade? Or do you want to learn how to make money? You can read books and search online and get to know a lot about trading but still never make any money. We want to be clear that our goal is not to learn how to trade. It is how to make money. Once we are clear about this we need to find a strategy that: 1. Is simple, not confusing 2. Makes us a lot of money, not a little 3. Makes us money sooner rather than later 4. Gives us some certainty and isn t like gambling. 22 P a g e

23 We don t want to be gambling like in Las Vegas. By the way, I ve been to Las Vegas several times and I didn t gamble. Ok I put 25 cents into a machine at the airport when I realised I had been there for two weeks without gambling. That s all I spent. Do you know why? Because I don t gamble. Gambling ensures I lose money. Therefore I don t do it. And nor should you. At Investment Mastery, we give you the exact strategy and formula, which tell you when to buy, when to sell, how much money to actually put in and where to invest. The strategies Let me take you through some strategies you can do in your spare time. If you want to go into more depth, then come along to our one-day event. There are five levels in all; each one takes more time and is more complex. Each also makes you more money. Strategy: Pound Cost Averaging (PCA) The first concept we want to talk about is a well-known concept called Pound Cost Averaging. With this strategy, you are buying into the stock at an average cost over time, not at a given high and low. What it means is that this can be set up in advance and fully automated. TRADING - More time & effort - More money 1. Dollar Cost Average (Fully automated) INVESTING - Automated - Zero time 23 P a g e

24 Most people earn their wages on a monthly basis. If they are investing, they will send money to invest once a month, normally at the end of the month. It is usually the same amount of money, for example, 100 a month. Every month the broker receives your money. As soon as they receive it, they invest it. Let s say in January the broker invests your 100, February 100, March 100 and so on every month, irrespective of the price. The price fluctuates, going up and down and so every single month they will be investing the money at whatever the price happens to be that month. Sometimes they invest when the price happens to be high, sometimes when it happens to be low and sometimes around the middle wherever the price happens to be. And therefore over time your money is invested at an average price, hence the term, Pound Cost Average. Why is that better than investing all your money at once? Let s take the example below. This is a typical stock, moving up and down in price. Notice that in May, June and July the price was high, at around the $31.25 mark. What if you had some money during those months and without looking at the chart you invested your money? You would have bought at a high. We don t want to do that. Instead of buying high, we invest the same amount of money every month. 24 P a g e

25 As you can see above, if you had done this, some months you would have invested at a low, some months at a high and some months at the middle. By doing this we get an average price of all these prices. The average is easily calculated by adding up the 100 each month i.e and then dividing the sum by the total number of shares bought i.e. 100 x 12 / Total Number of shares. So without a doubt, having an average price, i.e. somewhere in the middle, is far better than having invested all the money at the high of $31.25 or even higher. Pound Cost Averaging is widely used because it takes no thought at all and can be fully automated. This is its greatest strength because it means that most people can do it. And that is also its weakness. Because it is so random it relies on when the money hits the brokers account. So for example, if you have decided that you re going to be sending the 100 at the end of the month then the broker invests the money as soon as they get it. The broker would be happy to invest even if it was right at the top because the money came in. Remember, the strategy is fully automated and no thought is given to timing the market. 25 P a g e

26 So is there something better? I think there is we call it Value Cost Averaging (VCA) 2. Strategy: Value Cost Averaging (VCA) 2. Value Cost Average (10 mins a month) TRADING - More time & effort - More money 1. Dollar Cost Average (Fully automated) INVESTING - Automated - Zero time VCA is a dramatic improvement on Pound Cost Averaging and over time VCA will make you a lot more money than PCA. Using the same concept of buying in every month, it attempts to lower the average cost over time by purchasing a little more in the months when the price is down and less when the monthly price us up. So how does it work exactly? 26 P a g e

27 Let us take the same example as above. Remember that with Strategy 1, PCA, we bought 100 worth of shares every month, no matter what the price? With VCA, we do it differently. With VCA we are going to spend more when the price is lower and less when the price is up. So for example we are going to buy 75 worth of shares on the months that are up and in the months when it is lower you put 125 in. Over the two months you have still put in 200 but you have invested more in the months when the price is lower. What does that mean for the end of the year i.e. what do you think happens to your average price? Your average price massively comes down because you are putting more in at a better value, hence the name VALUE cost averaging. This strategy takes just 10 minutes a month! It massively outperforms PVA because you have brought down your average price. With PVA we are aiming for approximately 15% a year. And you can wrap it up in your ISAs so it is 100% tax free. You can also do this within your SIPP, so the tax is deferred. 27 P a g e

28 Further improvements on VCA You can further improve on the strategy by investing even more if the price dropped more next month, and even less if the price rose next month (see chart below). So if the price dropped again the month after it had already dropped, then you could invest 125, and if it dropped again, you could invest 150 etc. Equally, as you can see in the example above, if it rose, you can invest less, say 75 and if it rose again next month you can invest less again, say 50. It really depends on your brokerage costs. The idea is to invest more when it is down and less when it is up, so that your AVERAGE price is at a lower VALUE, hence, Value Cost Averaging. This way, when the price rises, you will be expecting a handsome profit. Remember that this strategy cannot be fully automated like PCA, but it takes just 10 minutes a month(!) and over time VCA makes you better returns for a just a tiny bit more effort. I hope you can see this. Most people are happy to stop here, but if you are not, then there is another level. Because let s face it, this strategy still relies on the time of the month and that isn t 28 P a g e

29 much of a strategy. So the third level can make you even better returns on your money, in not a lot more time. 1. Strategy: Buy Zone Sell Zone The Buy Zone - Sell Zone is an attempt to time the market without the stress of actually timing the market. Once the stock gets into a Zone, it is time to start thinking about buying, when it goes up too much it is time to start thinking about selling. The Zones take all the guess work out of timing the market. It is brilliant in its simplicity. (10 mins a week)3. 2. Value Cost Average (10 mins a month) TRADING - More time & effort - More money 1. Pound Cost Average (Fully automated) INVESTING - Automated - Zero time If we take a look at the same chart of the same stock over one year, it will tell us what the highs and the lows of that stock price are. We simply draw some resistance and support lines, or ceiling and floor lines. And then we draw a line in the middle. So now we have an Upper Zone (top 50%) and a Lower Zone (bottom 50%). If we just draw another line through the top half again (top 25%) and another through the bottom half (lower 25%), we get something like the diagram below. 29 P a g e

30 Now let s think about it for a moment. With PCA and even VCA we were quite happy to put money into every one of those zones, even in the top zones. Why oh why would you want to buy all the way up there? The answer is you wouldn t. This is where the next concept comes in: Buy Zone Sell Zone What about the lower half? Well I would be more interested in investing in the lower half and even more interested in the lowest quarter. So as you can see from the diagram above, what you ve now got is a Buying Zone. And you ve also got your top half which might be your selling zone. You want to be buying down here in Zone 1 and when it comes up here to Zone 4 you want to be selling. And here in Zone 2 you might be thinking about buying and in Zone 3 you might start thinking about selling. 30 P a g e

31 You can get quite creative here. For example, you put in 75 when it is in Zone 2 and 125 when it is in Zone 1. And you can sell 50% of it when it leaves Zone 3 and enters into Zone 4 and the rest when it touches the top of Zone % 50% What does that mean? It means that you are buying near the bottom more at the very bottom, and selling at the top some of it near the top the rest right at the top. In other words, you are starting to time the market, but without the stress of timing it to the second. Also, with the Buy Zone Sell Zone strategy you never have to miss out on the really big market movements that occur, which often happens when you are trying to time the market exactly. You can still semi-automate it by only looking at it on a monthly basis and making a decision on it just once a month and act on it wherever the price might be that month. However, with a tiny bit more effort you can start to time the market more by having alerts in place when a zone is hit. That way you only look at it when an comes into your inbox alerting you that the price has moved into a new zone. 31 P a g e

32 Why is this different? Well in the example above, from August to December, the price moved from a buy zone to a sell zone several times but just for a few days at a time. If you are looking at the charts just once a month to make a decision on your next move, you would have missed lots of trading opportunities to get in and out (trading). As you can see, we are moving away from investing to more of a trading approach. This is for people who have more time and really want to get the most out of the price movement within the month. Quick summary: in the first example the Pound Cost Averaging (PCA) we just got in whenever because it was just time to do it. PCA is good because at least it gets you to take action. It s all automated. You don t have to think about it. So it s better than nothing. You definitely make money as long as markets don t go down. If they go sideways and they go up you make money. With Value Cost Averaging you would be doing better in a market that temporarily goes down because you are buying more at the bottom. And you make a hell of a lot when it s going sideways and going up. In the third level of thinking you have Buy and Sell Zones. If you only buy near the bottom of the buying zone and sell near the top of the buying zone then what occurs here is that you have a situation where you are going to be making a hell of a lot of money if it goes sideways. Are you ready to get to the next level? So in the first level and second level we weren t timing the market at all. It was pure time IN the market. We dictated when we invested, irrelevant of the stock price. On the third level we re going to let the stock 32 P a g e