Merry Christmas, traders…
Ben here.
Trading, like life, thrives when guided by principles — timeless, unshakable rules that keep us grounded when emotions run high (or trades go against us).
So, in the spirit of the season, I want to share something special with you: the 10 Commandments of Smart Money Trading.
These aren’t just rules — they’re the foundation of every successful trading strategy I’ve built, refined, and relied on for more than 20 years.
What makes these commandments especially meaningful is how they apply to any market, at any time — even in the volatility we’ve seen lately.
If you’re struggling with managing risk, chasing trades, or staying disciplined amid the recent market uncertainty…
… these Ten Commandments will guide you toward confidence, control, and most importantly, consistent profits…
🏃♂️ First Commandment: Follow the Smart Money
I don’t mean to brag here … but I’ve had a truly fantastic year in the options market.
I just finished the latest roundup of high-level performance evaluations for my ‘Smart Money’ trading strategy (using my Spyder Scanner)…
…and it’s safe to say that my strategy is firing on all cylinders — and then some.
Here are my 2024 results:
369 Trades
312 Wins
56 Losses
1 Breakeven
Win Rate = 84.6%
Average Trade Result = 65.1%
Average Gain of Winning Trades = 88%
If that doesn’t convince you of my first commandment, I don’t know what will…
✂️ Second Commandment: Respect Your Stop Losses
Almost as crucial — you need to cut any positions that are moving against you immediately.
The ability to recognize a losing position and take swift action separates successful traders from the 90% who lose money.
Holding onto losing trades in hopes of a turnaround is a recipe for disaster.
Set your stop losses before entering any trades, and don’t move them lower.
REMEMBER: The primary goal is to protect your capital, ensuring you can trade another day.
✔️ Third Commandment: Find Your Perfect Position Size
Managing risk starts with controlling the size of your positions.
Avoid putting a significant portion of your capital in a single trade. Your position size should match your risk tolerance and overall investment strategy.
By doing so, you stay comfortable in your trades, safeguard your account, and ensure the ability to continue trading.
The maximum risk varies per individual, but a general guideline is to risk no more than 10-20% of a small account in one trade. (This number should be even lower for larger accounts.)
🧗♂️ Fourth Commandment: Minimize Your Risk
Alongside reasonable position sizing, keeping your risk exposure within comfortable limits is crucial.
This involves assessing the potential downsides of a position and ensuring they align with your risk tolerance.
That said, if you’re directionally correct on an options bet, you can potentially make more money than any common-share trader would (with less upfront risk).
This is why I love trading options … I can define my risk and give my trades more potential upside simultaneously.
🕵️ Fifth Commandment: Look at the Big Picture
In trading, maintaining a big-picture perspective is key.
Intraday market volatility can be distracting, pulling your focus away from what really matters.
The world’s best traders excel at interpreting broader market trends and understanding how they fit into their longer-term trading journey.
Instead of being swayed by short-term market movements, step back and assess the overall trajectory of the market (and your trading goals).
🙋♂️ Sixth Commandment: Be Ready for Anything
In the options market, you must be prepared for anything the market throws at you.
What will you do if your contracts are down 30% tomorrow? What will you do if they’re up 50%?
If you don’t know the answer, you aren’t ready. And you need to be ready.
Stick to your strategy, making decisions based on analysis — not emotions or market hype.
👨⚕️ Seventh Commandment: Health is Wealth
Often overlooked, your physical and mental health plays a significant role in trading.
A healthy lifestyle, regular exercise, and stress management are critical.
Your physical well-being affects your mental decision-making abilities more than most people realize.
As a former Division I basketball player, I know this better than anyone.
Take breaks, enjoy outdoor activities, and avoid being consumed by the market (and your screens).
🤔 Eighth Commandment: Always Know Why You’re Entering a Trade
Before entering any trade, have a solid reason for doing so.
This may sound obvious, but every week, I see trading students enter setups without a solid game plan.
Trading based on rumors, herd mentality, or gut feelings often leads to losses.
Instead, remember The 7 P’s of Day Trading.
Have a consistently repeatable process — and be religious about it.
😡 Ninth Commandment: Don’t Force It
Avoid the temptation to get greedy and force trades.
Not every market move aligns with your strategy or offers a favorable risk/reward scenario.
You might have an idea that isn’t actually playing out in the price action (yet).
Before entering any positions, ask yourself: Do you want to trade … or need to trade?
Patience is a trader’s best friend — it’s better to wait for the right opportunity than to rush into a subpar setup.
🥳 Tenth Commandment: Enjoy Your Trading Journey
Most importantly, you need to have fun and enjoy your trading journey.
Trading should be stimulating and fulfilling. Take it from me…
After more than two decades of trading, I’m as excited as ever for Monday mornings.
If you aren’t twice as passionate about beating the market as the guy next to you, you have zero chance of winning.
You need to be hungry for long-term success.
Don’t ignore your state of mind — a positive attitude can significantly impact your trading performance.
Have a wonderful Christmas,
Ben Sturgill
P.S. TOMORROW, December 26 at 12 p.m. EST — the great Danny Phee is hosting a LIVE WORKSHOP to go over the biggest Smart Money setups of the day.
The recent market volatility is setting up huge opportunities — Click here so you don’t miss the next big move.
*Past performance does not indicate future results
