 Hello there everyone and welcome. This is Melissa Armo with the Stock Swoosh and I thought I would go over today the importance of sizing. There was a trade that we did. It was yesterday, June 2nd, that failed. It got stopped out, it did not work. I didn't get back into it. That was a good decision actually. Anyways, it very well could have worked. It was crazy that it didn't work but the market lift lifted and when the market lifts, it lifts all things with it. Anyways, getting back to what I was saying, sizing is important because if you mis-size yourself and what do I mean by mis-sizing yourself? I mean taking too much risk or too little risk. So if you're gonna risk $500 in every trade, then that's what you need to do. Which consequently means that the difference between the entry and the stop is different in almost every trade we take that the number of shares that you take will not be the same. So you can't just say 500 shares, 1,000 shares, 1,000, 1,000, you can't. It has to be the dollar amount of the risk should be the same or equal to the same. So you might take one great trade, fabulous trade and undersize it and then take a second trade and oversize it and lose and then you lose. Excuse me, or you could take one bad trade and risk four times the amount you want or three times the amount you want and then you need four trades just to get back to break even of equal size. So the bottom line is that sizing is critical and I'm just gonna go over this here. This was Microsoft yesterday, okay? Stock opened here and long story short, we had the stop in, it was basically three and a half bucks was the stop. We shorted it, it rallied, it pushed up, you can see it failed. Actually, you can see really that it completely failed in the day here. This did get down, it was news in the morning, it was an outlook, flipped. Anyways, we had to stop in, it stopped everybody out. But if you didn't size yourself right, in other words, again, three and a half bucks was a large stop, in my opinion, that was large for us. Microsoft is not cheap anymore, it's expensive though. So again, size of stops is relative to the spread of the stock and usually the cost price point as well. So bottom line is that if you took just a thousand shares, willy-nilly, you would have risked what, $3,500. And if you don't risk $3,500 on every trade you take, you would have completely oversized yourself if for example, you would normally take a $500 risk or even a thousand, you would have lost three and a half times the amount in one trade. That's my whole point why sizing is critical and I think this is something people struggle with. One of the reasons people struggle with it is because it's easier to just take the same share quantity every time, but you can't do that. When I call a trade, if I say for example, 50 by 30, that's 80 cents is the risk. Some trades we take, the risk is 80 cents. Sometimes the trades we take, the risk is three and a half bucks, which was this one here. So do you see the difference? Sometimes it's 20 cents. So, and then you might undersize yourself, you know. But it is important to have the risk be the same. This is not an exact science. The trades are setting up quickly. I'm talking fast in the room. You gotta follow, you gotta know we're watching. We're only usually watching one thing at a time. So I don't think it's hard to follow, but sizing is important, people struggle with it. Why? Because they are good at math. I hate to say it, I hate to say it, but it's true. People are not good with math in their head. This is a strong suit of mine. It's been, I've been working with numbers for years. Again, I used to do mortgages and fun fact here. I used to pre-qualify every single person. First of all, if somebody wanted to buy a house, I had to pre-qualify them to get the, to put in the offer for the real estate agents. So I had to do all the work like an underwriter myself, look at the income, look at their tax returns, figure out everything they did, figure out, pull their credit, look at all their debts, figure out what they could afford. But I did that for people when I just did refinances too. So I've always been good with numbers and quick with numbers. And I did it with refinances because I didn't want to submit a loan to the bank, to an underwriter and have it get declined. I might say to someone, you've got to pay off this credit card or you can't, you won't get approved for the refinance or whatever, or we have to roll it all in together to consolidate. I would look at all that stuff as if I was making a lending decision like an underwriter, because I knew what they were looking at. So I was always looking at the numbers. When I was helping people, that's why I had such a high approval ratio. If someone would come to me, I mean, I had a very high close ratio that they would get the loan approved, which was something that not a lot of mortgage people did because I took the time to sit with people and also evaluate the information, their credit report and their income before I even put through an application so the application would get approved and not decline. But the fact is that numbers has been a strong suit for me. If you are not used to doing calculations in your head, if you can't figure out when I say 50 by 30, that that means 80 cents, if or a dollar 80 could be depending on the stock we're doing, or if you can't size yourself enough, then take it down, put 100 share quantity or 200 share quantities in your setup so you don't oversize till you get used to doing it. You can add, if it continues to go, buy a calculator, you can do that too, and then you gotta get better at math. I don't think it's hard and I think it's very useful to be good with numbers and mathematics. I felt it useful my whole life, but I think if you're in an industry or you're used to doing something for work where you didn't have to use numbers, then you have to buy a calculator or size down because I don't wanna see people taking a $3,500 risk and something like this when they would normally take 1,000 or less. So sizing is critical, it's important, and I want people to do well. This is a topic we'll have at the top, another discussion and maybe I can do it on the white board and talk about it more, but this is a trade that we did that lost, it didn't work out. I'm glad I didn't go back after it. It flipped, it failed on the day, rally with the market, but the stock was big. So this was a good example to go over here, why it is so important to size yourself, right? Not that we have big stops all the time, but occasionally we do. Again, the stock is over 270 bucks now. So a $3,500 stop, that's really not crazy because when it goes in your favor, it goes a lot, it has a big move and you can make a lot. So we'll see where this goes next week. I'm also watching the market. Good luck everyone. Any questions or if you're interested in signing up for the Golden Gat course, it's in a couple of weeks. The end of June is the June class, June 25th and 26th. Have a great day everyone.