A Personal Review of Tradenet and Lessons Learned
By: Richard Raynes, a Real Life Trader
“You have to have money to make money.”
“Money doesn’t grow on trees.”
Money actually does grown on trees, as Jerremy Alexander Newsome, of Real Life Trading (RLT), points out in his book, “Money Grows on Trees.” Money is an endless resource. It is everywhere! This was one of the hardest realizations for me. I was always told to get out of debt, try not to borrow anymore, etc. Although it wasn’t until my father passed that I actually realized that it was available and I needed to take a leap. This is where Jerremy and RLT introduced me to methods of using other people’s money.
If you are here reading this solely to learn about Tradenet and my recent experiences, please feel free to skip the “about me” section below.
Let me first take a step back and introduce myself. At the time of writing this, I am twenty eight years of age. I will be married in less than a week to my wonderful bride-to-be and love of my life. I have a Bachelor’s degree in Mechanical Engineering, Minor in Mathematics, Graduate certificate in Business Management, and will be wrapping up a Master’s in Engineering within the next year. Let me answer the question on your mind already – I do not love school by any means! I always thought of this as a way to improve my career, my lifestyle, and as Jerremy says, MONEY! Income, cash flow, net worth, retirement account, etc. The list goes on and on. Like the majority of individuals that look to RLT for knowledge, we all want to learn how to trade stocks more efficiently and improve our trading profits, winning percentage, and take home more money. Money is an enabler to do the things we want; it is a tool. I will leave that discussion for you in Jerremy’s book, “Money Grows on Trees.” By the way it is a fantastic read!!!
Back to my background – I opened my first trading account when I was 18 years old, put in the majority of my cash I had saved up from bussing tables and mowing yards in my neighborhood in the 3 years prior, and put it all into a mutual fund (maybe a few thousand). This was back in January 2009, as I went when I was on break from high school. I had no sense of risk/reward, targets, or anything – I was throwing it in to a fund and just letting it sit as many people do. After a few months, I grew aggravated as the mutual fund I had chosen did not move much, and I looked at my account daily to weekly with minor fluctuations up and down. So I then sold the mutual fund, waited about a week, and bought shares of some small company at around $6 a share as I thought a low-price meant buying low and selling high. This was not the case as the stock basically went to about $4 very shortly after. I flipped out and sold it all, cashed my account out and ended up buying a motorcycle, leaving all trading behind.
I really did not get into stocks again until late 2015. I actually had been researching cryptocurrencies, when I stumbled onto RLT on Tradingview. I began messaging them via Tradingview and received pretty prompt responses. It was awesome to get such great support. At this point in time, I was working full-time, going to school part time, but wanted to learn about trading. I did not take a leap into the markets, even with all of the golden education I had just stumbled upon. Then crypto jumped in 2017, and I never sold any of it, even though I was about 500-600% profitable from my overall investment (including buying in at BTC of approximately $8,000). I then reached out to the RLT team. I spoke with Brad and Jerremy both – trying to discuss debt and investment opportunities as I wanted to get back that 500% profit and more! It was in my account, I saw it, or so I thought, but it was never a realized gain since I never sold any. Undisciplined and without a plan in place, I knew there was room for improvement!
In late 2018, I was determined to learn and begin trading. I watched as many videos from RLT as I could, text Jerremy question after question, had a plan in place for what I was going to do and when. I even had my father watching videos at home so he might one day start trading too. My plan to get to trading again included finishing my Master’s degree and then start trading right after. When my father passed away in January 2019, I decided life is way too short.
I almost immediately reached out to Jerremy again and joined the trading room, the Clique Fund Professional trading, and spent most evenings trying to improve. Unfortunately, the Clique Fund was having some technical issues, and after weeks of waiting and getting my refund, Jerremy told me to look in to Tradenet – now we are getting in to what everyone wants to learn about, and why you are here now!
My Experience with Tradenet:
My big problem was having the funds to trade. A few thousand dollars doesn’t work for day trading due to the pattern day trader rules. This seems to be a problem for the vast majority, or so they think. It is all our in our mind honestly. It is out there for us, if we look! This is how I was introduced to Tradenet.
I started by reaching out to Tradenet with a list of questions:
Is the platform web-based?
Buying power for each level and how are upgrades handled?
Order types available using the platform
How are profits distributed?
Do I need to pass a test or follow a platform strategy for the program?
I will get into this shortly. I ended up signing up for the 5 Day Demo Challenge the next day after sending them these questions - this includes not paying for anything yet, receiving a simulation account of $10,000 trading currencies, a list of rules, and a goal to profit $500 within 5 trading days. The instructions were sent to me, along with the platform download link, 2 hours before market open on a Tuesday morning. I quickly read through, anxiously, and downloaded the platform. Shortly into the market, I was up almost $200 from one trade (I set an $80 R), so I stopped for the day and waited for the next day to begin. However the rules do not let you do this. Again, my fault, but I only really read through the rules one quick time before starting, re-read after the market closed for the day, and realized I did not follow the rules.
A short version of the rules were as follows:
3 active trading days out of 5, where at least one trade is taken.
2 or more trading days with $100 minimum profit.
Between 6 and 20 tickets per active trading day – more or less than the required amount results in disqualification from the challenge.
Max daily loss of $100, and max overall loss of $300 (commissions and fees included).
If you win, you have 7 days to claim your prize.
Other rules, but those can be read if you decide to join, i.e. a video and survey regarding your trading for Tradenet to use.
Unfortunately, I was disqualified the first day. I sent an email to the representative I had worked with that evening after re-reading the rules. I then decided to join the Intro program. It cost me $400 with a discount they provided for trying the challenge, and gained some training material and a funded account of $14,000. I was finally on my way!!!
I went through a lot of the material in the following day, thinking it was required. Their education is a bit different from RLT, but overall, the basis is similar. It was a different strategy for handling number of shares and risk. Within a week, I was trading in the Tradenet live account with the $14,000 account and trading in some higher priced stocks, I lost my max drawdown of $700 over two weeks. This was due to my R calculator (if you have not read/watched the RLT videos on Risk, please do!) trying to set my 2R target based on my number of shares, which was limited by the account value.
Seems simple enough, but for me to accommodate this issue where the total buy was more than my buying power, I set the number of shares based on max account value, then adjusted the target price in order to reach my 2R target. Obviously, putting the target further away made it more difficult to hit the target. So in short, I blew up my account quickly when only trading TSLA, BABA, AAPL, and SPY. I also had not learned to move my stop very well. Detrimental to a trading account!
Then I upgraded to the student version of the program. This was an additional $2,700 (since I blew up my intro account), but provided a buying power of $80,000 with a max total drawdown of $4,000. This pretty much eliminated the issue above (as well as an update to my calculator), plus I left my R at $100 to begin and gain confidence (still gaining, but have about 50 pages of notes alone from my lessons learned overall in trading). This is the account I am in today – although I am down, I am not out by any means and do not see all that I have learned and continue to!!!
Lesson 1: Do not extend targets purely due to limited buying power – see example above.
Lesson 2: Learn Tradenets order types and understand the screens.
An example of their trading platform as a whole (as of now) is shown below. This is customizable and you can add charts, more stock screens, etc. This is only an example of how I have my screen setup as I chart on another computer and monitor.
Image 1: Tradenet TEFS Trader Screen Example
There are a few screens to view. The “Trade Manager” I have in the bottom left shows active tickets and past trades for the day.
Image 2: Tradenet TEFS Trade Manager
The “Account Manager” has any active trade performances you are in, and account buying power and overall value. I have the “Top 20” list for just an overview of some active stocks.
Image 3: Tradenet TEFS Account Manager
We then have the stock screen below. To change stocks, you simply type in the ticker in the highlighted upper left box. Shown below is INTC. One big lesson I learned is that checking the box, “implement range” (about ¾ down the screen below) enables the high range and low range boxes for price entry. This is the same as an OCO (one cancels other) trade. So if I want to enter with a stop-limit as a stock rises, I choose the order type to be stop-limit, enter the stop price and limit price, then check the implement range and enter my target and stop loss prices. This creates a trade that some refer to as OTOCO (one triggers a one cancels other). This is typically what I use now to enter trades, as this forces me to make sure I plan the trade ahead of time, and not just jump into a trade randomly.
Image 4: Tradenet TEFS Stock Screen
Lesson 3: Order modification – some active orders can be modified in your trade manager. You can modify an active order that had a range implemented on it by right clicking and modifying the range. Make sure that when you submit the change, that it actually changes the order in the Trade Manager screen for the order “HiPrice” and “LowPrice.” If not, then the change was not accepted and does not really tell you otherwise; there is no error message shown.
Lesson 4: Customize the screen how you want to and save it. I have my screen setup as above, but I use another computer for charting. This is what I do for now, and use an older laptop to trade on. You can set it up however you would like. Tradenet also had a recent press release discussing updates to their platform overall – looks interesting!
Lesson 5: Utilize the range trade after entry, even if you did not enter the trade with the box checked to “implement range.” You can submit a new order as a range order after already in a trade. This creates the target and stop loss for the trade.
Lesson 6: Understand the rules of the platform. None of these were explicitly stated up front, and because of this I missed numerous trades in my first account, and jumped in via market entry – aka did not follow my plan! I had to learn and then ask and verify.
Limit entries must be 3 cents away from the current bid/ask price. The order will be rejected if too close, which is shown in the gray rectangle box under the ticker, and no ticket shown in the trade manager.
Stop price must be 5 cents or more away from limit price. Therefore there may be more slippage than desired.
Lesson 7: A simplified fee structure is shown below – it may not be exact, but it is what I have learned and use thus far on average:
$6.00 / 1000 shares or $1.50 (greater of the two)
$15.10 deduced from the account balance monthly
Routing fees per trade (examples below) a. 250 shares AMD in/out cost $0.75 b. 200 shares SPY in/out $0.60
Profit split is dependent on the program you choose and ranges from a 70%/30% split to a 95%/5%
Lesson 8: Liquidate your positions by the end of the day. If you do not liquidate your day trades at the end of the day, you may hold them overnight. This can be both good and bad. Tradenet allows you to hold 20% of your account value overnight. This means if you hold a trade and do not liquidate, you may be in it the next day still.
Lesson 9: Realize some slippage will occur when stock volatility or spreads increase. Since it is a CFD, it is going to fill based on best case bid/ask once it can. That being said, I have seen stock prices go 1 cent beyond my target exit on TD Ameritrade or TradingView, and not be filled. Then I come back and see it is now a losing trade as I had to leave for a meeting. Keep this in mind, as I am now looking at utilizing trailing stops when I must step away.
I highly recommend that if you are interested, try the challenge account prior to jumping in, just to learn about the platform and how it works. This will be great, and gives you five days free. Plus, if you follow the rules and win, you get a $14,000 account for free, and can upgrade at a discount. There is a link to the demo challenge below.
If you can afford it and truly want to take advantage, then join for the $80,000 account. If you need more than they offer via the link, they have larger accounts (see below).
By using the referral link below, you help out this fellow trader (me), and also take advantage of a nice discount through their program. For any profits made by this referral, I am promising to donate 30% toward the active monthly charity challenge that RLT is participating in. If there is not one, I will speak with the RLT team and slack channel and find a good one in need. For example, usually the $80k account is $3,000, but you can get it for $2,700 through the referral link below.
If you want more buying power, they offer the following:
They even have two more programs above this that you can upgrade to:
The Junior Premium: Cost $15,000 for $400,000 buying power
The Intern Premium: Cost $25,000 for $600,000 buying power
Feel free to ask me questions if you want to, or I can also get you into contact with Tradenet support to answer any questions.
If you subscribe to RLT ~ find me in the Slack Channel: RRaynes
By: Richard Raynes, a Real Life Trader