How The System Worked in 2014


The following information is for educational and entertainment purposes only. Rio Verde Trading and the author make no claim that anyone can or will achieve similar results in their trading.

In 2014 my net income from trading the 74% Solution was $938.55.

One of the characteristics of this trading system is that I am out of the market most of the time. In 2014 the system generated 17 trades. These trades had me in the market for a total of 86 days.

In order to make the best use of my capital, most of my funds are invested in long term investments. Normally I would have a portfolio of dividend paying value stocks. I pay a lot of attention to macro economic conditions and am convinced from the writings of Peter Schiff, Michael Pento, James Rickards and others, that severe economic dislocations are on the horizon. Accordingly I have moved most of my money into defensive gold and silver mining stocks.

The gold and silver sector has been in a cyclical bear market correction, for the past three years, within a secular bull market. The beginning of 2015 is seeing strength in the precious metals. Hopefully this bear market correction is coming to an end.

Anyway I did not buy the mining stocks for dividend income, but my portfolio of mostly gold and silver mining stocks did produce a dividend income of $411.39.

My trading profits of $938.55 more than doubled last years dividend income of $411.39. If I had invested my capital in SPY the S&P 500 ETF, the dividend yield of 1.87% would have given me $748.00 of dividend income. The trading profits would still have more than doubled my dividend income.

Also, since I am carrying a very low cash balance, my trades have been very conservative. Using one of my risk reduction strategies, as explained in the soon to be available 74% Solution trading manual, I have been reducing the size of my trade positions. In other words, a normal trading position size should have increased my $938.55 profit.

So this is how it works, invest a substantial amount of capital in long term dividend paying investments, to maximize return on capital; then make high probability trades, using your  long terrm stock portfolio for margin, to substantially increase income for your portfolio.

It works. I have been doing this successfully since 2002.