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Avoid Shorting a Strong Market or Risk Losing Everything!

By Andrew Aziz  |  
Andrew's Newsletter  |  
Nov 8, 2023

Dear traders,

I apologize for missing the trading session at the Open on Monday, November 6th. I overslept, and due to not feeling well, I decided to take the day off.

Regrettably, I also missed celebrating Peter’s birthday on Monday! Peter is one of our best traders who joined our community as one of the early members. Since then, we have developed a close friendship, and I hold him in high regard. He’s not only a great mentor to me but also a successful trader, corporate executive, businessman, and, most importantly, a family man.

I am very proud of our relationship and look forward to many more years of working closely with him at Bear Bull Traders and Peak Capital Trading.

Brian, Peter and myself in San Diego in 2018, when we were all younger!

Unfortunately, today I made a significant $10,000 loss by attempting to short the Nasdaq-100 QQQ using a leveraged product called SQQQ. It is the opposite of TQQQ, designed for shorting the market.

If you go long SQQQ, it’s like shorting QQQ with x3 leverage. The market was strong and steadily rising, and I attempted to short it prematurely, without a plan and outside of my regular trading hours. It was a complete lack of discipline, and I paid the price for it.

If you want to learn how I lost $10,000, you can watch my recap here and share your thoughts in the comments on what I could have done better.

Tonight, we have an essential session on position sizing and trade management presented by one of our great traders, Thor. Trade management is the key to trading success.

It’s remarkable that both Brian and I often trade the same stock at the Open but in opposite directions, yet we are consistently profitable. This demonstrates how trade management is the crucial factor in consistent trading success.

Don’t miss this webinar by Thor; it’s open to all Elite members. The recording will be available for viewing 24/7 in our Education Center.
As many of you know, I recently paid off the mortgages on two of my properties. In Canada, mortgage rates are fixed only for 5 years maximum and must be renegotiated every 5 years, even if you have a fixed rate. I decided to pay them off in full.

The real estate market is influenced by various factors. At one point, we have record-breaking mortgage rates, but simultaneously, there’s a shortage of supply in Canada and the US for newcomers and new generations. So, understanding the dynamics of the market isn’t straightforward. It’s not an easy correlation.

The median home price in the US is now down almost 6% from its peak, while inventory is still ~40% LOWER than the long-term average. Mortgage demand hit its lowest level since 1994 this week.

What does this mean? Higher prices have been primarily due to a lack of supply. However, the Fed has indicated that higher unemployment is needed to combat inflation. If unemployment rises, foreclosures may follow quickly.

If the Fed “succeeds” in weakening the labor market, it will impact housing.

With excess savings depleted, a spike in unemployment almost guarantees a spike in foreclosures.

It seems we have a fragile housing market.

Our Peak Capital bootcamp is going strong, with several traders making progress and on route to taking profit from the bootcamp! I’m thrilled about our new program offering a $50,000 funded training account, making the bootcamp even more appealing for traders.

In a recent survey, 95% of traders found the bootcamp well worth the price and would recommend it to others. Over 30% of traders are re-joining our bootcamps.

Great success, and congratulations to Peak Capital mentorship traders, captains, co-captains, and our presenters!

To your success,