Analyzing A Trading Strategy | Podcast Episode #523

0:02
Hey, I’m Ryan Mallory and this is my Swing Trading the Stock Market podcast. I’m here to teach you how to trade in a complex, ever changing world of finance. Learn what it means to trade profitably and consistently, managing risk, avoiding the pitfalls of trading, and most importantly, letting those winners run wild.

0:19
You can succeed at the stock market and I’m ready to show you how. Hey everybody, this is Ryan Mallory with shareplanner.com. Swing Trading the Stock Market. In today’s episode, we are going to Sweden for this question. We’ve got a a listener he’s listened for about the past year.

0:36
He’s in Gothenburg, Sweden. That’s actually sounds like a pretty cool name. There is like something out of like ADC comic book like Gotham or something. But any case listens Trade Swedish stocks, doesn’t trade U.S. stocks and has been able to learn a lot from the show.

0:53
And he’s come up with a system that that he feels like works for him and wants to know what my thoughts are on the system, if there is any major risks or downfalls to the system that I’ve received and, and what he should be aware of. So instead of giving this guy a good old Florida red nickname like I usually do, instead I’m going to give this guy a Swedish red nickname.

1:16
Now, I didn’t know if those actually existed. So I did some research on on the Internet and and found one that really kind of hit home. I like this one. It, it sounds Swedish redneckish, if if that’s even like a term out there. I know it obviously it is in Florida and here in the United States, but I’m going with the name Bajorn Skogsberg.

1:35
I feel like if you rolled up on a guy named Bajorn Scogsburg you you probably think that he’s wrestled an alligator in Florida at one point in his life. So that’s the name I’m going with Bajorn and Bajorn writes. Hi, my name is Bajorn and I am riding from Sweden.

1:50
I am a big fan of your show since a year ago when I found it is really helped me getting a proper idea of what trading is. For example, my first year three years ago, I ended up feeling that I lost money, but I did count it all after you had said that it could be a good idea to keep track on your actual results.

2:08
At that point I realized that I had broken even. At first this really didn’t comfort me as I still saw it as a failure until you talked about that most people actually lose money in trading. My second year, 2025, I made about 25% return after taxes and fees and so far in 26 I’m up 20% return.

2:27
And then and it was after finding your show that I found my swing trading strategy. First I would like to point out that I don’t see myself as a trader as I am not making a living on it, but rather this is me building capital. But what I don’t know, as it is more of a for what I don’t know is that it is more of a hobby for me.

2:46
But I do have a vague idea in the back of my head that in three or four years, when I have more capital and experience, I hopefully could do what I have managed to accumulate over the last three years, growing up in a dysfunctional family with an alcoholic father, then working as an artist.

3:03
It is only now that I have money to save or spare. So the way to trade that has grown to be my strategy is built on the following rules. Only by Swedish stocks to avoid extra fees and taxes, although they are low, very low here in Sweden on capital but not on the wages.

3:21
I have made a list of about 10 companies, mostly basic industry and manufacturing but some banks as well that I focus on and almost have a relationship with. Sweden is not a big country and we are not and we are, but we are reliant on mining, steel and weapons.

3:38
So it is like an ecosystem I am trying to keep track of and rather rather than have to end analyze individual stocks, I only buy big stable companies that I am familiar with or even worked in. I know that they are good profitable companies. I go all in on every position to maximize my profits, avoid banking fees and also to focus on one deal at a time.

4:02
We’ll get, we’ll get to that one in a little bit here. Volatility isn’t very high and I usually sell at about 1/2 percent to 2% gains. I don’t hold for the stock market to go up more as I am looking at my profits overall and they mostly beat any individual skyrocketing stock.

4:21
I usually don’t sell at the at the stock dips. As I said, the company is stable and it will come back again eventually. Sometimes it takes a couple days but sometimes months. I am steadily getting better and better on finding some movements in these specific stocks.

4:38
I never buy before earnings reports or other events, but I sometimes use the dip after dividends. I know this is not suitable for most traders that they need capital for new positions so they take a loss, but I can see it as a break and just wait it out.

4:54
When I get a bit more to trade with this, all this can change obviously. Also I can probably buy more positions at the same time. Anyways, I wanted to share this with you since you have been a big inspiration for me and I have wondered and have even though I have wondered my own way.

5:12
Do you see any big problems with the strategy that I might that I might have missed? I know me holding on dipping stocks is a problem, but am I underestimating it? I am happy with my results and comfortable with my way of doing this. It also suits my life as an employee, as a church warden and my social life.

5:31
I will include a pic of my trades just to show how I document my trades, although the companies are all Swedish so it might not tell you very much. Wish you all the very best. Bajorn Scogsberg from Gothenburg, Sweden.

5:47
OK, there’s a, there is a lot of unpack here. I know I say that a lot on the podcast, but this is a good throw e-mail. I love it when it’s long like that cuz I get a feeling for who the person is, the background, what, what maybe trying the person, testing the person and just really a good idea of who they are and where they’re at.

6:05
A couple things. And I always like to look at just some of the like the general language that’s being used, you know, how they reference certain things. And I’m not a psychologist, psychiatrist, none of that stuff. But I’ve, I’ve noticed a lot of things over the years that people will say or what they will do in relation to their trading.

6:21
That always stands out to me because I like, like trading the, the stock market. You see trends, you see patterns. And I think sometimes I see that as well in the emails.

6:38
And then he says this is more of a hobby for me. It’s not just a hobby. And you are a trader. You’re trading in the stock market. You’re definitely trader. Are you a full time trader? No, and you say you’ll even hope to become a part time trader, but you are already are a part time trader. And, and one of the, the main points I’m trying to make here is that don’t, don’t underestimate what you’re doing, you know, and, and definitely don’t, don’t underestimate it based on how much money you’re trading, because it’s not about the capital.

7:04
There was a time where it was about the capital when you were getting hit with like $20 fees every time you bought, every time you sold. If you want to take partial profits, that was another $20. And that could really add up. And so the amount that you were trading made made a difference because if you were trading with $5000, it was, you were probably just going to give that all to your brokerage over time.

7:23
But now that the commissions are gone and I, I don’t know exactly what the case is in Sweden. And that, that may be one of the reasons why he’s trading a bigger position size. But, but he also said too, that the, the fees and taxes are, are, are, are pretty low in Sweden, but not on, on the wages.

7:41
So I’m guessing that they’re probably taxed heavily on the profits, but the, but the commissions are probably low. But again, you’re trading $20,000. Believe it or not, in the United States, most people do not have $20,000 to trade with.

7:58
So you’re way ahead of the curve. In fact, if you just look at the economics of the United States right now, in general, most people cannot even afford $1000 out of expense pocket out of expense, unexpected problem.

8:14
You know, if like they’re AC in their car breaks and it’s $1000, most people do not have $1000 to cover for that. And so the fact that you’re sitting on $20,000, that’s huge. And so you should treat it as huge, but don’t, don’t look at what you’re doing is being just a hobby or is just, you know, something that you hope to do a little bit more aggressively over time.

8:34
You’re getting better right now, you’re trying to improve right now, you’re trying to get to that point to where it is much more of a substantial amount of capital that you’re trading. But one of the things that I I see a lot in your emails that you’re focusing a lot on the profits, right?

8:51
You you’re expecting things to come back up. You’re looking at bat at how much money you can make and you’re looking at taking profits between a half percent to 2%, which is typically not a ton to make. Yes. Will there be trades that you only make a half percent on? Absolutely. But you should be aiming to get a little bit more out of your trades for the most part.

9:07
Now, I don’t know like what your win rate is. I don’t know the amount that that that you lose on versus how much you went on. But some of the things that you said in the, in the strategy doesn’t look like that you even allow for losers. And we, we’re going to talk more about that as well. But again, the 1st 2 points that I want to make, trading is not a hobby.

9:26
You know, I, I think that’s a way to marginalized what it is like sometimes you start, you know, tinkering with playing the guitar sometimes like it’s just a little hobby right now. You know, it’s almost like we don’t want it to be taken too serious because we’re afraid of what people might view it as like, Well, for somebody who’s taking this, you know, that serious, he sure isn’t good at it, you know, or why you if he was serious about it, you think, you think that that guitar would be sounding a lot better.

9:51
He sounds like crap. That’s what you want to avoid. You know, that that mindset where you’re marginalizing yourself now you’re you’re a traitor. You’re trying to be a traitor in. So we have to act like a traitor in our in our decisions and our thoughts and what we’re doing as it pertains to our capital.

10:10
So those first two things are out of the way that the other things that we need to start talking about is each one of these points here because I think each one of them are incredibly important.

10:27
Before I get to that, check out the self-made Trader on shareplanner.com. You go to Trading Academy on shareplanner.com, you’re going to find this, this incredible course that I’ve put together.

10:44
It took me about four years to do. There’s just about 25 hours of video instruction. I edited myself. I planned it all out myself. I filmed it myself, did the whole thing. In fact, it took so long that if you look at the first video to the last video, I’ve actually aged some bit in between.

11:18
So it, it did take quite a while to to do, but it was something that I wanted to wear. It had everything that I knew about trading being conveyed to the person wanting to learn how to trade. So you’re going to get all the basic and beginning concepts and then you’re going to be taken throughout all the different stages of trading, from the psychology to your track, your strategy, scanning for stocks, building the watch list, finding the stocks to trade, executing those trades, managing the trades, closing out the trades, and then just being able to reflect back on those trades, on what worked and what not.

11:18
What didn’t. You’re going through again, beginning strategies to more advanced strategies. Highly recommended. Go to shareplanner.com and check out the self-made trader.

11:38
OK, keeping on with these points, these are the following rules that Bajorne uses on his trading. First off, only buy Swedish stocks to avoid extra fees and taxes. Although they are very low in Sweden on on capital, they aren’t on wages. So what I’m guessing there is that they’re pretty heavy on on taxing on the profits. But in terms of just like, you know, place in a trade, there’s there’s not a lot of fees or expenses there, which is good.

11:57
That means that allows you to take partial profits along the way. You’re not being Hanford by the overall market. And also the things that I teach in swing trading, it doesn’t just apply to U.S. markets. It applies to whether you’re training in Japan, where you’re trading in Sweden, Mexico, Canada.

12:15
It applies to all of them. A lot of the people that I’ve coached over the years, they, I would say, I’d say like 50% of them for some reason, I don’t know why, 50% of them I’ve been outside of the country. So when it, when it comes to to this first rule, I don’t see anything wrong with it.

12:33
He’s trading Swedish stocks. He lives in Sweden. That’s fine. He says. I’ve made a list of about 10 companies, mostly basic industry and manufacturing, but some banks as well. I focus on the ones I have a relationship with.

12:53
I think a lot of times when we trade what we know and I think that goes back to like Peter Lynch talking about always investing in what you understand. And I think even Buffett has that to a certain degree as well. It gives us a little bit more comfort, comfort to it.

13:15
I mean, I know I’m guilty. Like when I’m trading Google, I probably feel a little bit better about trading Google versus when I’m trading a stock that I’ve never heard of. But until just recently, or even though it might have plenty of liquidity and stuff, if I don’t know what it does, sometimes it’s easier to divert to the stocks that you do know.

13:32
So I think that’s a natural human tendency. It’s easier for you to trade like Airbnb because you’ve used the Airbnb or you’ve stayed in the Airbnb versus like for me, Ulta, right? I don’t shop at Ulta. I don’t know anything about Ulta, but my wife does, but I don’t.

13:52
And so, you know, if I’m just going, you know, based off familiarity, I’m, I’m probably choosing a stock that I, you know, like Airbnb or Uber or something like that, that I’ve used versus Ulta, which or Lululemon, which I don’t know anything about outside of, you know, both of them being apparel.

14:09
So that that’s fine too. I mean, if you’re only doing 10 stocks that that may limit how often do you have a trade to take. You may be waiting a lot longer at times. While there’s other setups out there, I don’t necessarily just, I have a list of stocks that I have that I always keep an eye on.

14:25
It’s about 100 stocks or so and then I’m always scanning the market anyways. I’ll, I’m willing to trade pretty much any kind of stock that’s a ticker as long as it meets my requirements for a trade.

14:46
But I don’t think trading has to be stuff that you’re necessarily familiar with. And sometimes you can have more of a bias to to trading a stock that you’re familiar with that doesn’t have as good of a trade setup than a stock that you may not be as familiar with, but has a much better trade setup.

15:11
So it sounds like with Bjorn here, he’s analyzing the industry, seeing where the rotations are going at, where the capital’s flowing into, and then there’s specific stocks that he will trade, try to capitalize on that. The only thing is, is that sometimes stocks may not be following its industry. Like you see it a lot right now where there’s certain semiconductor stocks that may not be rallying with this epic run that’s been going on with semiconductors and with technology as a whole.

15:34
And when that happens, you’ve got to kind of wonder, why is that? Why are they not keeping up? And that should be a red flag for trading only by big stable companies I am familiar with or even worked in. I know they are good profitable companies. So from a swing trading standpoint, profitability doesn’t matter as much because from the long term investing standpoint, you definitely want that trajectory where they’re either, you know, running towards profitability and burning less and less cash.

16:02
Cash reserves. I guess that would probably be better said then than a stock that’s just perpetually going lower. Stock and swing trading that’s perpetually going lower can have decent bounces at times that you can capitalize on. It doesn’t necessarily mean you want to make a long term investment out of it, but if there’s an opportunity there to play, the bounce might be worth taking versus I would never trade a stock that that was perpetually going lower.

16:28
Even if there were bounces along the way, I wouldn’t want to make a long term investment out of it because I don’t have the confidence that it’s going to provide a return for my money down the road. So that is definitely something you want to be careful with.

16:46
Another thing here he goes all in on every position to maximize my profits. And that’s that’s one of the things that we want to really hunker down here and think about. Are we here to maximize profits? Yes, but we’re doing that by minimizing risk.

17:13
And so you maximize your profit by minimizing the risk because if you get into a stock and you’re maximizing your, your reward on it, it doesn’t, it doesn’t do you any good if the next trade you’re maximizing your risk as well. We have to minimize our risk. That is one of the biggest things.

17:28
And I think when you go all in on a trade, one, you’re going to be much more emotional about it too. You’re, you’re not going, you’re, you’re exposing yourself to the potential unknowns that could come about on the stock.

17:46
Perfect example. I use this example a lot because it was with Apple. It was in the beginning of the of a new trading year was probably like 7 years ago or so. I don’t know that number. I don’t know the exact number of years ago, but it was in January when my first trades of the year and they did our earning earnings warning.

18:12
They were like, we don’t think the earnings are going to be as good and they sink seven, 8% on me. Now you do that by maximizing all of your money into one trade, all $20,000 that you’re trading with. And you’ve already admitted that that’s a lot of money for you. And it is, it’s a lot of money for any anybody that’s you know, you know, of, you know, middle income, you’re down now all of a sudden 7% that that all of a sudden does not feel very good.

18:29
It’s concerning you’re it’s an overnight risk that that you took on and you just took a massive hit from. You couldn’t have planned for it. Apple’s not going to tell you that they were going to put out an earnings warning.

18:58
And and yet it happens. There’s there’s certain risks in the market that you can’t plan for it. And that stinks. That’s what you’re opening yourself up to. What if it’s not just like a earnings warning that drops at 7%? What if it’s a, an event like what we just saw recently with Google, where all of a sudden they’re going to, you know, dilute their shares by doing another offering of, of stock, Then you’re taking a much bigger hit and you got to hope that it comes back.

19:16
Now, remember, not all stocks come back. A lot of them do, but it’s the ones that don’t that kill you. That’s the ones that are going to destroy your portfolio. And so we’re trying to prevent that. We want to be able to play for the long term.

19:41
And I feel that the more that you trade, you’re going to come across one of those events that you weren’t expecting. And if you’re completely long on a stock, you know, fully 100% long and that’s your only position, it sets you up for a, a really bad situation there.

20:00
You’re going for 1/2 percent to 2% gains. But the, the bigger question is, is what is the risk? And and that’s probably one of the things that I’m, I’m gaining from Bajoran here is that there’s not a ton of emphasis on the risk except for like I’m not going to trade through earnings or set up a position right before earnings.

20:16
Yeah, you want to avoid earnings all together when it comes to swing trading. But some of these swing trades are not necessarily swing trades. If if you have to hold through these draw downs, you admit here that, you know, I don’t sell the stock. If it dips against me and I and I get taken out.

20:34
I feel like dip is, you know, maybe like sugar coating it a little bit. It’s when it sells off and it goes against me and it and it hits a, a level that I probably should be getting out at. I don’t, I just wait for it to come back. That’s not a novel approach to trading, a lot of people do that and a lot of people eventually do get caught in a bad way.

20:51
And So what scares me is that you’re you’re trading where I let the stock come back over time. Sometimes it takes days, sometimes it takes months. And I’ll be honest, like I get stopped out of a lot of stocks that do go right back up again.

21:07
And I think that’s where a lot of people stumble and they struggle with it ’cause they can’t handle that. I just got taken out. I lost $1000 and now it’s right back up. And I could have had that $1000 if I would just held until the next day.

21:26
It’s true. But when the time comes where there is that one stock that does not come back and you go back to, and I know some people think that this is crazy that I will go back 20 plus years. But you go back to the.com bubble. It took the NASDAQ 14 years to get back to where it was at at the height of the.com bubble.

21:52
And so if we have one of those other events likethe.com where we’re in the AI right now, we we do see a significant sell off in the market. A lot of people don’t think that that’s possible, but it is. I’m not saying it’s happening tomorrow or anything, but we just got a good preview of what it could look like on Friday when the market sold off as much as it did, like 200 plus points at one point.

22:11
Sometimes it doesn’t come back the way you think it is, and then it can take years. And sometimes you’re just in the wrong stock and that particular stock does not come back.

22:26
I mean, go look at Kraft Heinz or General Mills. Those stocks have been suffering for years. And so if you’re all in, you’re suffering for years. You’re not getting out, you’re not making any trades for 3-4 years and you don’t want yourself to be in that position.

22:35
So I think that part of swing trading is having the confidence to know that if I’m getting stomped out, it’s not so much that I’m, I’m losing money, it’s just part of the, the cost of doing business, cost of trading is, is taking losses. And so you have to take losses along the way because you’re going to have winners that that follow and you’re going to be able to maximize those gains by minimizing your risk.

22:11
So you know, to answer the question at the very end, do you see any problems with what I’m doing here? Yes, I absolutely do see problems and I would, I would really try to focus more on the risk aspect.

22:11
What am I going to do if the worst happens? What are your draw downs looking like on the portfolio? Because if you’re trying to make, you know, like 2% on a trade, right, you said between a half percent and 2% trying to make 2% on the trade.

22:35
But in order to realize that you’re having these average draw downs of 4%, well, that doesn’t make a lot of sense because you’re taking on twice as much risk on average just to be able to get these 2% gains.

22:35
Or even if it’s just like 1% and you’re averaging 1/2 percent in gains, that’s still not a good thing. So you want to be mindful of how much are you risking in that regard.

22:50
If you enjoyed this podcast episode, and I hope that you did, please make sure to like and subscribe. If you’re listening to me on YouTube, if it’s on Spotify or Apple or one of the major spot podcasting platforms, make sure to leave a five star review.

23:06
I do appreciate those. I try to give you guys honest feedback. I know there’s a lot of people that will just tell you what you want to hear in life and when it comes to trading at your capital, I want to give you guys honest feedback.

23:22
I don’t want, you know, to hurt people and you know, just by making them feel good. I always tell people, tell my kids this actually, you know, in, in this world, people want inconvenient, they do not want inconvenient truths.

23:22
They want convenient lies told to them. And we have to be willing to tell the inconvenient truths rather than tell people the convenient lies. And so that that’s what I’m here to do.

23:44
I hope that not only just for Bajorn’s sake, but for others listening to this podcast episode, it helps to bring for some perspective on trading in general.

23:44
And if you enjoyed this podcast, though, again, make sure to send me your questions. Some of your stories. I want to hear about them. ryan@shareplanner.com is the best way.

23:44
My eyes only looks at these emails. And also make sure to check out the self-made trader. If you’re ready to get serious about trading and wanting to learn and exactly what that entails, you can do that by going to shareplanner.com, clicking on the Academy and it’ll give you the the course listings.

24:09
But that self-made traders, the the gem of them all, remember Jesus Christ. He is the way, the truth, and the life. Nobody comes to the Father except through him. Thank you and God bless.

24:09
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24:31
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24:47
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24:47
And if you have any questions, feel free to reach out to me directly at ryan@shareplanner.com. All the best and I look forward to trading with you soon.