To The Moon

Speaker: Tom Yuen (YCK) shares the two rules he says matter most from his floor-trading days, how he thinks about probability and discipline, and how trading differs from investing.

[About the Speaker] Tom Yuen (YCK) has over 30 years of professional futures trading experience, including 14 years trading his own capital as an independent floor trader at SIMEX (now SGX-DT). He teaches an approach built on technical analysis, trading psychology, probability and risk management, and is an SGX-DT-endorsed trainer.

[The Hook] When YCK started on the floor, senior traders passed on all kinds of tips. After boiling them down, he says only two really matter.

[Golden Rule 1: Don't Trade Against the Trend]

On the old trading floor, big orders came in by phone and pushed the market for a few ticks when they hit the pit. Floor traders watched that order flow and went with it rather than against it. Today there is no floor, so the question becomes: is the market trending up, trending down, or moving sideways? YCK's advice is to have a methodology for identifying that, and to follow the trend it shows. He keeps reminding the audience it is still a probability game, where getting direction right makes money and getting it wrong loses it.

[Golden Rule 2: Cut Losses]

YCK calls this the more important of the two. Even with a trend established, any position can be wrong, and being wrong is normal: "wrong, cut, wrong, cut" is routine for a trader. When he began educating investors he found that the investor's vocabulary often has no concept of cutting a loss at all.

A related point he made: some investors use dollar-cost averaging, adding more as the price falls to lower their average cost. That can be part of a long-term plan, but with a leveraged product you cannot afford to keep adding to a losing position. His takeaway for the room: write this rule down and keep it.

[Probability and the Professional Gambler]

YCK offered a deliberately provocative analogy: trading is the same as gambling, if you treat it the way a professional gambler does. A professional knows the odds and the house rules, plays the long run, and walks away from a table when the numbers turn against them. An emotional gambler has no edge and doesn't know what they're doing. Since nobody can know what the next trade will do, he says you only need to trust probability: it is mathematical, and there are repeated opportunities.

[Discipline, Defined]

YCK defines discipline as doing something you naturally don't like to do because it is good for you. Different people struggle with different things, so they need different disciplines. He also noted that trading shows you who you are: a good citizen, a good parent, and also, sometimes, an emotional "monster" that needs controlling.

[Trading vs. Investing]

• Time horizon — investing is longer-term; trading is shorter-term, from days down to minutes.

• Direction — investing typically profits when prices rise; a trader can aim to profit from moves in either direction.

• Risk handling — traders cut losses; investors may add to positions to average their cost.

• Analysis — YCK treats an index as a number on a chart and relies on technical analysis rather than company-by-company macro research. He argues that if timing matters to you, technical analysis is worth learning.

He didn't present one as better, only as different, and encouraged each person to work out which one suits them.

[Key Takeaways]

• Know the trend before you trade. Trending up, down or sideways decides which side you consider.

• Define where you're wrong before you enter. A cut-loss level is part of the plan, not an afterthought.

• Think in probabilities. Edge plus discipline over many trades is the goal; no single trade matters that much.

• Know which game you're playing. Trading and investing use different rules.

[Call to Action 🎯]

1. Write your own one-line trend rule (for example, how you decide a market is trending).

2. Before your next paper or live trade, write down the price at which you'd admit you're wrong.

3. Drop a comment: are you more of a trader or an investor, and what makes you say so?

Markets are always moving - and sometimes, the best move is knowing what works for you.

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