Success Stories 

Surviving the recent market correction & coming out on top

Brenton Hill’s share trading story - October 2007

Five years ago Brenton Hill barely knew anything about share trading and since then he has quit his full-time job as a mechanical engineer to earn a living buying and selling shares.

In September 2003, the 37 year old embarked on an exploration to learn about trading shares.  After less than two years share trading and a couple of weeks before his second child was born he quit his job and started trading full-time.

“I had made enough from trading part-time for nearly two years to be confident I could trade for a living,” Hill said.

Using a mechanical share trading approach Hill has grown his float by over 200%* over the past three years.

When Hill describes the secret to his success he explains, “The market is not out to get you it’s just the market.  To be a successful mechanical trader it is important to divorce yourself from the daily happenings in the market so that you consistently follow your system.”

This is exactly what Hill did during the July and August share market correction which saw many traders say goodbye to thousands of dollars.  Fortunately Hill was able to make money during this market tumble using mechanical share trading systems and sticking to his trading rules even when the market kept going down.

Hill said, “I gave back a fair chunk of my profit to the market in just one week and then regained this and more. I am well ahead again now.”

The trading style that Hill uses includes 12 systems which he trades in both the US market and on the ASX.  The goal of some of these systems is to identify and buy falling stocks which have dropped significantly and are expected to rebound. This type of system is described as a mean reversion system.

“Mean reversion trading is the revolution to making money quickly.  One trade made me 74%* in two trading days, but those kinds of results don’t happen every week,” said Hill.  Hill tests the performance of each system using historical data from the past 10 years. He refers to this form of paper-trading as backtesting. “All of my systems would have performed successfully over the past 10 years according to my backtesting. These results give me confidence to trade shares in all market conditions.  There are anxious moments but you must stick to your system rules to be successful,” he said.

Hill trades both equities and Contracts For Difference (CFDs) and he stresses that a stock must have sufficient liquidity before taking the trade.  Based in the Adelaide Hills, he explains that he never envisaged himself as a share trader and being at home with his young kids everyday.

If it wasn’t for an advertisement that he noticed in the paper one day detailing HomeTrader share trading courses he would probably still be working long hours as an engineer in the mining industry. Brenton is now involved in Research and Development at HomeTrader.

Remember that CFDs are geared and can result in losses that exceed your initial deposit. They may not be suitable for everyone, so please make sure that you fully understand the risks involved.

All testimonials are provided voluntarily, without payment, inducement or other benefits.

*Past performance is not a guarantee of future performance.