The Naked Trader

How anyone can make money trading shares

Robbie Burns

• Publisher: Harriman House
• Year: 2011
• Print ISBN: 9780857191700
• eBook ISBN: 9780857191663
• Edition: 3
• Topic: Business
• Subtopic: International Business
• Index: Business

Completely updated and expanded 3rd editionThe most entertaining book on the markets is back - and this time it's even more revealing. In this completely updated and expanded third edition, top trader Robbie Burns gives you the lowdown on the strategies you need to make money from the stock market without having to sit at a screen for every second of the day. Robbie quit the rat race more than ten years ago, and believes you can do it too.The first two editions of The Naked Trader flew off the shelves as the glowing reviews from readers mounted up. This brand-new third edition contains even more essential content than before: more vital tips, more key facts, more ideas, more insights, more real-life tales and an awful lot more toast. Not to mention twice the number of secret trading strategies: 20 proven techniques that you can use to make money from the markets.Trading shares, eating toast, making moneyRobbie, aka the Naked Trader, is your expert and highly entertaining guide to the often baffling world of the stock market. In between cups of tea, rounds of toast and watching "Cash in the Attic", he describes the straightforward techniques that have enabled him to succeed in the markets, escape the rat race and ensure he never has to wear a tie again.This book tells you all you need to know to become a successful investor. From how to find good shares in the first place, ensuring you don't buy a complete stinker, to getting your timing right, minimising your losses and learning how to let your profits run. And for the first time, find out how Robbie even made money and protected himself during market meltdowns and how you too can defend your trading when the market throws a wobbly. He also happily reveals his mistakes too.If you're a complete beginner you can start here. And if you're currently trading but want to learn some new ideas, get reading now! The Naked Trader is packed with practical and easy-to-follow advice, with none of the incomprehensible jargon found in so many other books. Robbie hates jargon and writes in plain English! Whether you just want to make a few quid on the side while you're at work or eventually you want to go on to make money from the markets full-time and quit work like Robbie, this book is all you need to get started.So grab some tea, toast and relax - and start trading the naked way.

Part I: Rat Race, Exeunt

“Money can’t buy friends, but you can get a better class of enemy.”

– Spike Milligan

1. Escaping the Rat Race

My story

In about 1998 I remember sitting in a grim office overlooking a dismal carpet warehouse on the A4 and thinking: “Is this how I want to spend my life?”

I was earning quite a bit, but I wasn’t happy. I didn’t want to be in a horrible office working for a big company anymore. I knew what I wanted: freedom!

I quit the rat race in 2001 and have never looked back. I love my lifestyle. No moody bosses or targets. Just me! Of course there are no office politics – but I can live without them!

I now sit at home in my office overlooking the Thames, with my feet up, putting on a trade here and there and relaxing. My wealth continues to build in the markets over time.

Luckily for me, I realised working for someone else – unless you absolutely love what you do – is a mug’s game. You’re just there to pay the mortgage every month.

So while I worked for BSkyB, I also worked for myself. I had a shiny Reuters machine on my desk (after the cleaner had been), and I learned everything about the markets through practice.

I quickly realised I could make a lot more money trading than in my full-time job, and in 2001 I quit to trade more or less full time. Before this, though, I had to get some extra money to trade with.

The delectable Buffy

So while still employed I started to develop other income streams – one of which, incredibly, included a Buffy the Vampire Slayer information line. This made me £250,000 over four years! It simply involved me reading out the latest Buffy news on my phone at home – eager viewers would call a line to hear the recording, and I made money out of each call. Sadly the series ended in 2000, and so with it the line.

I started it for a bit of a laugh … but on its first day the guy who owned the phone company called me and said: “Bugger me, it’s just taken £400!”

Happiness is … residual income

And I sold mobile phones and cut-price phone calls and energy for a company called Telecom Plus. And still do now, actually, from time to time via my website. I got – and still get – a cut of every phone call made or energy used by customers that have signed up through me. It’s called residual income and it pays all my bills even now. I still earn from customers I sold to in 1999!

Armed, therefore, with a huge pile of cash, I quit my job and decided to trade full-time.

Waiter, there’s a fish in my fish pie

However, I did want a bit of a fallback in case I wasn’t such a great trader, so I bought a café near a tube station in Fulham. That proved a lot of fun and I made quite a bit of money. My wife and I improved it till it made £1,000 a day instead of £300 – it was very successful.

So successful, in fact, that it actually became a pain in the neck. More customers, which led to more staff, which led to more problems. Classic growing pains.

Sometimes staff didn’t turn up and I found myself making coffees at 7am! It involved all kinds of problems: firing staff; talking to customers complaining there was fish in their fish pie; and dealing with all the mess a café brings.

The worst incident I can remember was when all the staff were sick, and I was on my own behind the counter trying to deal with a large queue of people.

So I shouted out to the café: “I need help! Anyone want a short-term job? £10 an hour.” And one of the customers came to my rescue and started serving. There was a lovely community spirit and I met a lot of great people.

But with my son arriving on the scene it became too much effort to run it, and enough was enough.

I had originally intended it to be the start of a chain, and I nearly bought a second café, but decided in the end I didn’t want to be a retail mogul. Too much effort – I’d rather have less money and enjoy relaxing.

So I sold the café for roughly double what I paid for it. Interestingly, running the café helped my trading because a café business is quite complex, and learning the accounts helped me evaluate stock market businesses.

A lazy life

So now I just trade and run my website www.nakedtrader.co.uk.

I also hold five to six seminars a year, where I show readers my techniques using live markets on a large screen. I really enjoy them and it gets me out of the house too.

And it’s amazing how many share picks come out of these seminars which go on to make me plenty of dough.

It’s also good fun to meet readers and have a drink with them. If you want to come to one, see the info on the seminars at the end of the book. Maybe we’ll have a drink together sometime!

The markets have certainly made me very happy. There are plenty of other people like me around who have managed to quit their office jobs and trade. And they, like me, are nothing special. All it takes is some discipline, determination, and – I’m afraid – some trading capital. I can help you sort out the discipline and determination, but you have to come up with some capital.

I hope The Naked Trader will put you on the first rung of the escape ladder. Trading stock markets really is much simpler than you might imagine once you see past the jargon. And I promise you won’t find any of that here.

What sort of trader am I?

I suppose I am more of a medium-term investor/fairly frequent trader than a day trader. Maybe I should be called the Naked Investor. I expect you imagine a trader to be someone sitting at a desk all day feverishly buying and selling shares.

Well, that’s not me at all. I don’t want to be like that. I want to be, oohhh … drinking tea and eating toast. Having a snooze. Going to the gym. Watching the racing. Sitting in the garden with a good book (or a bad one – I always fall asleep, whatever the book is like. Especially if it is a finance one). And I enjoy playing with my son. And, okay, basically I’m a bit lazy (is it time for a nap yet?).

What I hope you’ll learn is that you don’t need to spend 40 hours a week in front of a screen watching every move the market makes. And it is even possible to trade or invest if you have a full-time job, as long as you can get some peace and quiet on the internet at work at some point during the day.

In fact, that may be the best way to start trading. Begin by making some extra money while you’re working, and learn the tricks of the trade.

Instead of spending all day emailing your friends, getting addicted to Facebook or Twitter, fiddling with your iThing or BlueBerry, spend a bit of time at work learning how to invest.

Keep this book handy

I suggest you keep me handy, even when you think you’ve sussed out how to make money. Because, even if you’ve read the book once or twice, you may need me again if you fall into bad ways – and believe me, you will be tempted. And I will always be here for you to skim through …

Anyway, I really hope you enjoy the book. You don’t need to read it all in one sitting. Read it in bits and let it sink in. Take it on holiday and read it on the beach. Keep it handy when you’re going through a bad trading patch. Don’t take it on a date, though. There just isn’t room for the three of us in the relationship.

2. A Day in the Life of a Naked Trader

Dear diary …

6am

I’m in bed of course! What on earth is 6am? I know people in the Sunday Times’ ‘A Life in the Day’ column always wake up at 6am, go running for five miles, have power breakfasts, make executive decisions and are dressed and at their desks by 7am. But this day-in-the-life is an honest one. I will be asleep. And if you try and wake me up I will hospitalise you. It really is quite simple.

7.15am

My young son Christopher awakes on the dot of 7.15am and so promptly brings us all hurtling out of the Land of Nod.

I grab some tea and toast and head for my trading desk (well, it’s just a desk with a computer on it). I lift the blinds up on my office windows and I always smile: I think I have the most spectacular view in the whole of London. I live right by the Thames, just off the towpath. And because I’m opposite a wetlands centre, I see the river, trees and the sky! No buildings are allowed to be built on the opposite bank. The view (which the government will no doubt tax shortly) is so great it always reminds me how lucky I’ve been and how glad I am that I got into buying shares so I could afford to buy the apartment without a mortgage.

Actually this hour is one of the most important parts of the day, because at 7am every morning companies report their results and release announcements. First thing to do is ...

Table of contents

• Cover
• Publishing details
• Praise for The Naked Trader previous editions
• Also by Robbie Burns
• About the Author
• Acknowledgements
• Preface: Welcome to the Crazy World of Shares
• Introduction: Trading Shares, Eating Toast, Making Money
• Part I: Rat Race, Exeunt
• Part II: Getting Started
• Part III: Picking Shares
• Part IV: Trading Strategies
• Part V: Charts, Timing, Targets and Stops
• Part VI: The Next Level
• Part VII: Trading in Real Life
• Part VIII: The End (Almost)
• Appendices. This is Not Goodbye, but it is Au Revoir
• Now add to your trading library