With every trade you have the risk of the trade, but there are a number of other risks that can be extremely costly if you are not prepared to deal with them.
I’ve got a couple of real-life true stories that just happened to share with you, then we’ll bring this into YOUR trading and what you need to do to protect yourself.
Over the weekend I had two reminders of the importance of being prepared for the unintended. I say “unintended” because we don’t ever plan on having accidents or events beyond our direct control happening.
But we can foresee them and take action.
1. The Power Outage that shut me down
On Friday July 3rd, my webhost got shut down due to a power outage from a fire 300 miles away from their home office. When I got on the phone with them about it, they said that I was one of over 6,000,000 customers of theirs that was shut down.
When I asked with a customer base like that, why didn’t they have some redundancy in the system? A power outage is definitely foreseeable. They answered that it was too expensive. Let’s see how expensive it is when they lose a million customers.
I have already begun the process of moving my websites and email to another host – one that has taken action to ensure uptime in the event of something as predictable as loss of power.
2. The Fireworks ‘accident’ that could have been life threatening
The second reminder I got was when we were lighting the fireworks for the show our neighborhood was putting on. Now South Carolina is a huge fire hazard. Pine trees everywhere and pine straw everywhere. It’s a giant pre-built fire waiting to be lit.
To light the fireworks, the guy in charge decided to use the patch of land under the power lines, away from the houses, and in a cleared spot where the grass had been mowed down.
But 100 feet away, the tall (and very dry) grass stood.
As I walked up to help him unpack the mortars and fun stuff, I knew immediately that we needed to have something at hand in case some of the sparks hit the ground as they inevitably would.
I sent my son Max back to our house to get a fire extinguisher and a 5 gallon bucket to fill with water.
We only got about 10 minutes into the show when one of the smaller (thankfully) mortar bundles fell over and shot right over into the grassy area. I immediately grabbed the bucket and Max grabbed the fire extinguisher.
In the few seconds that it took us to get to the fires, there were about 20 and they were spreading through that dry grass like it was a field of gasoline.
We got all but 2 of the fires out very quickly, but we had run out of water and the fire extinguisher was spent.
Fortunately, those last two were right behind a house where the people had been sitting to watch the show. They had grabbed their garden hose and started spraying out the last two.
That whole thing was really a close call, because with nothing to put out what we did, that fire would have spread down the power lines both ways, including back to where we had the fireworks all laid out – and these were BIG mortars we had.
Now there are pine trees and straw all over our neighborhood, and I have little doubt that this little ‘accident’ could have turned into a life-threatening fire in a matter of minutes.
Fortunately, I had the notion to be prepared.
We wound up having a great 4th of July, one that we’ll all remember forever.
Your Trading Business and Preparedness
In your trading, you rely on several things all of which are subject to unintended events, but there are some that you can foresee and take action to ensure that the impact on you is minimal.
1. Power outage. Do you have a backup plan for the possibility of being without power for a few hours? How about a few days? What would the risk be if you were cut off from the markets in the middle of the trading day (or week)?
There are things you can do, such as having a UPS (uninterrupted power supply) for your computer for the short outages, having a location you can go to which has wi-fi access so that you could hop in your car with your laptop and get there fairly quickly if need be.
2. Fire. Do you have a remote data backup? They are readily available and many are free, at least for a certain amount of data storage. Keep your vital stuff compressed and encrypted safe.
3. Hard-drive crash. Do you backup your computer regularly to somewhere other than only your hard-drive? You can use jump drive or external hard drive and they are not expensive.
4. Dramatic changes in the markets. This is one that many traders get nailed with, just like last fall. There were thousands of traders left in a really bad situation: the markets went crazy and their system no longer was working. Many had their accounts wiped out and didn’t know what to do.
The best contingency plan for this to be able to adapt to changing market conditions – without having to play the guessing game and using trial-and-error with real money.
How can you do this, quickly, easily and with zero risk?
When you are forced to make changes to your system (or you simply choose to) the fastest and safest way to do it is by using the Trading Performance Analyzer. It shows you what works and what doesn’t with ZERO RISK – in objective numbers based on real market data.
You can try it risk-free by clicking here.
Those that already had the Analyzer before last fall weren’t worried at all. They were prepared and didn’t lose any sleep. As a matter of fact, they were having fun profiting from the crazy market while everyone else was losing their minds (and their money).
Don’t leave your trading business at risk to unintended events.
Take action right now, protect yourself and avoid the regret of 20/20 hindsight.
Cheers
Brian
P.S. I don’t have to tell you that contingency planning and taking action are the smart thing to do for yourself. You’ll only have yourself to kick if they happen and you did nothing.