Trading Nut | Trader Interviews - Forex, Futures, Stocks (Robots & More) · Cam Hawkins

289. How to Profit Even When Trades Go Wrong w/ Nick Shawn

October 21, 2024·51 min·4 clips

Nick Shawn trades without a strategy, relying solely on intuition and a unique risk structure.

Nick Shawn returns to the Trading Nut podcast to discuss his evolved trading philosophy with host Cam. Shawn has been trading for over eight years and is known for his transparency, sharing his trades live with subscribers. His current approach rejects traditional strategies and stop losses in favor of intuition and a specific risk management structure. He describes his method as a hybrid of dollar-cost averaging, recovery trading, and grid trading, which he cautiously likens to a martingale system. Shawn trades with very small position sizes, using one to two lots on a $200,000 account with regulated broker Forex.com. He cites a recent 14% monthly gain, or $30,000 profit, with a peak drawdown under $5,000. The core of his process is a two-step decision: first, he intuitively decides if a price will go up or down, and second, he applies his risk structure to manage the trade. He argues that profitable manual trading ultimately depends on a trader's intuition and discretion, which are honed through experience rather than rigid rules. Shawn compares learning to trade to learning to ride a bike—it's a skill developed through practice, not just theoretical study. He acknowledges that accounts using his method will eventually blow up, but he mitigates this by regularly withdrawing profits after hitting growth targets, like doubling the account. For gaining experience, he recommends starting with a small, risk-defined account or a demo, using a 0.01 lot size per $2,000 to trade numerous pairs on higher timeframes. This framework aims to protect capital while building the experience needed to recognize favorable trades. A significant mindset shift involves accepting the defined risk upfront, which he believes removes emotional attachment and fear from trading decisions. The episode includes a practical chart example where Shawn illustrates entering a trade based on a simple directional guess and then adding to it at predetermined levels if it moves against him. The conversation is educational and philosophical, blending personal anecdote with practical trading mechanics. This episode is ideal for traders disillusioned with conventional strategies and interested in psychology, risk management, and alternative approaches like DCA. Listeners seeking guaranteed, back-tested systems or those uncomfortable with the premise of no stop losses would likely find it less appealing.

As heard by us

A trading discussion that puts capital protection and low-risk learning ahead of profit chasing.

Nick Sean frames trading as a way to manage risk before it is anything else. He lays out a mix of DCA, recovery trading, and grid logic, with the aim of getting a trade back to break-even or a small profit even after a rough entry.

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Why you'd press play

If you want a risk structure built to survive bad entries, start here.

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