Trend following is a strategy normally associated with trading. You wont see it associated with Top Web Entrepreneurs. This is surprising. The strategy serves both types of activities quite well. I intend to set the record straight with this article!
First, A Bit Of Background
If you lookup trend following on Google, it will report that some 286,000 pages mention the expression. I am willing to bet that most, if not all, are related to speculative trading.
However, I am also willing to bet that Top Web Entrepreneurs, whether knowingly or not, use a strategy based on trend following to guide them in their choice of Web endeavors.
Let me explain.
I used to invest my money. That has brought me a certain significant return. But, it took decades of compounding the meager crumbs that the banks and other financial institutions were (reluctantly) giving me in interest.
One day, in 1998, I switched strategy. I became trader. I am what is known as a system trader. I have developed a system to protect myself while trading. My trading is based on a trend following strategy.
Im proud to say that it works remarkably well. For me, that is. Theres a catch, you see. It requires strict adherence to the a plan: my plan.
My plan, discipline, tight control over emotions, and patience make up the name of the game.
What Does Trend Following Trading Have To Do With Top Web Entrepreneurship?
The skills required to become a Top Web entrepreneur are not much different than the ones a consistently successful trader uses. Note the use of the word consistently. Anyone can be a lucky trader. Many think that Top Web Entrepreneurs were lucky to find their niche. Not so. They all worked hard at identifying it, and at planning how to best exploit it sometimes months, or years, before the event makes the news.
Top traders also work hard. Most of their energy goes into preserving their capital, so that they will always have enough to trade the next day, and never go broke. They never take risks! They manage risk. Theres a major difference.
So much so, that managing risks is the most important factor between success and failure, both in trading, and in business.
When the trend becomes newsworthy, it rapidly ceases to be worthy of exploiting! It is cresting, in its adult phase, then. It will soon begin to decline.
Top Web Entrepreneurs, just like Top Traders, plan to get in as close to the (confirmed) beginning of the trend as possible. They avoid entry when the trend has already given most people a good run for their money! The probabilities of cresting are getting bigger, at that point. They do not want to enter a trend, just as it is about to decline.
How does one become a successful Web entrepreneur without taking risks?
By testing your ideas offline first!
Successful traders, do their testing outside of the markets. That use sophisticated computerized systems, either bought commercially, or home brewed. The very Top traders use home brewed systems. They feed their system years of historical data about the stock, or foreign currency they are interested in trading. The tests are computerized, so they take a few moments only. In a flash, they know what potential their idea may have about that given stock or currency. They also know what the risks are. They can prepare to counter them.
Successful Web entrepreneurs also make use of computers, of course. But not in the same way. They do not have years of historical data to test their ideas on. Only uncharted grounds are potentially ripe to give new types of crops. Its in the very nature of innovative ideas to not have a history.
Top Web entrepreneurs use sophisticated systems to mine the Web for the data they need. They develop their own system (around a strategy), but use the computerized applications that are available on the Web. Remember, the data they need does not exist at least, not as a coherent, filtered set yet. They have to look for signs of it. Then they analyze the signs. This analysis leads them to retain some pieces of data, and reject others as irrelevant. Not an easy task at best.
Top Web entrepreneurs will use their brain, and their experience in a given field of interest, to analyze what they find.
Their imagination gave them a business idea. They will carefully validate it, plan for it, and time their move into implementation.
They are like top competition surfers. They know what signs to look for, and they have the acquired a sense of timing to take advantage of a building wave. They are in there even as the wave is beginning to form (below the surface and most everyones radar). Sometimes, like Top traders, they reach the zone, totally concentrated. They are already stalking and preparing for the next profitable wave (trend), in the right spot, at the right time, before the coveted event even begins to form!
To get there, Top Web entrepreneurs use sophisticated, flexible Web searching tools to mine the Web for information. These tools exist, and are mostly free to use. However, they are scattered, uncoordinated, about the Web. Sometimes, they only exist as beta applications that only a few enthusiasts know about.
To give you an idea of what trend stalking might mean on the Web, have a look at the Google Alerts, and Google Trends. Many Web entrepreneurs use them, as general purpose tools, in an attempt to identify the trend they are looking for.
There are dozens of much more specialized and powerful tools for Web research and analysis available. You just have to try them until you find the ones that best fit your requirements, and personality.
When The Signs Are There
When it begins to look like their idea is being confirmed by enough verifiable signs (note the word verifiable), Top Web Entrepreneurs will immediately start planning its implementation carefully. They will give it a structure that will later house what they will be offering their targeted clientele. They will also have identified the latter through thorough research.
Their Web business is taking shape offline, at that stage. No risks involved. I hope you get my drift! They make sure their idea will work, before they commit themselves! Thats what planning is all about.
The First Small Step
If the idea looks viable, they start small. Very small! Just to give you an idea, I never bet more than one percent yes, you have read correctly, never more than 1% of my total equity on any given trade idea. Thats how small a step I am willing to take at any given time. That should give you a measure of how careful, patient and disciplined successful trading is. After a while, if my trade idea works, I will add to my position progressively. If all the conditions of my trading system continue to be met, I continue to execute my trading plan in a very disciplined way.
When Top Web Entrepreneurs have thoroughly researched and tested their business idea offline they will create the home page of their Web site, and publish it online.
They will slowly add to their position, from there. Meanwhile, they keep up their research effort. They watch for signs of their idea drifting away from the trend they have identified, and chosen to follow.
In fact, they go wherever their traffic leads them. They will patiently, and dutifully follow that trend to destination and success.
They will publish one well researched, keyword focused Web page at a time. They will slowly furnish the structure they planned in the first stages of preparation and thus progressively increase their tailor made offer to their target clientele.
A New Web Business Is Born!
As you can see, it did not happen suddenly. Nor, was it due to a stroke of luck.
Top Web Entrepreneurs innovate and follow trends.
Thats the apparent paradox.
Claude Jollet is a former planning advisor to major industrial and commercial clients. He specialized in weather related operational planning issues. He holds a bachelors degree in applied computer science, specializing in business process analysis and automation. Mr. Jollet now devotes all his free time to the promotion of entrepreneurship on the Web. He reaches his following with his Web site http://www.top-web-entrepreneurs-plan-it.com