Michael Marcus was wiped out more than once before he succeeded. What changed? He learned money management. In this article we look at his early years, the mentor who taught him to survive, and why 'survive first, everything else comes later' is the most important idea a new gold trader can take on board.
Where he started
Marcus started in 1972 with about $7,000 in savings and lost it, more than once, in his early years. He was not short of conviction or effort. What he lacked was a way to stay in the game long enough for his ideas to pay off. Each time the account went to zero, so did the opportunity, however good the next idea might have been.
The lesson: survive first
He credited mentor Ed Seykota with teaching him money management. That meant sizing positions so that no single trade, or run of trades, could end his career, and treating the account itself as the thing to protect. Once that clicked, he went on to great success at Commodities Corporation. The ideas had not changed much. His ability to survive the bad ones had.
Survive first. Everything else comes later. For a gold trader, this is the order of operations. Before you think about how much a trade could make, decide how much it can lose, set a stop-loss at that level, and size the position so the loss is one you can absorb without flinching. Only then does the question of profit even become relevant.
Money management on every trade
Every trade idea we send includes an entry, a stop-loss and a take-profit, so the money management is built in before you press the button. What we add in training and in the group is how to size each trade for your own account, so a losing streak is survivable. Learn money management first with us in the free community.
Key takeaways
- Marcus started in 1972 with about $7,000 and lost it more than once.
- Mentor Ed Seykota taught him money management, then success followed at Commodities Corporation.
- Survive first; everything else comes later.
Common questions
What did Michael Marcus learn from Ed Seykota?
Money management: how to size trades and protect the account so that no run of losses could end his trading career.
Why is money management the first thing a trader should learn?
Because without it, one bad run can wipe out the account before any good ideas have time to work. Survive first, then everything else can follow.
Trade ideas with the levels already worked out
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Risk warning: This article is educational content, not personal investment advice. Gold is a leveraged, volatile instrument and you can lose some or all of your capital. Gold Trade Signals is not FCA regulated. Read the full risk warning.
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