Drawing a brilliant analogy between war tactics and trading.
Archives of “February 1, 2019” day
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Discipline for Traders
- Discipline is doing whatever needs to be done to achieve your goals. You do what needs to be done whether or not you feel like it.
- If I have a goal, then my actions support that goal. If I don’t act upon my goal, then I’m just wishing. Successful traders know what needs to be done, and they do it. No excuses. No evasions. Simple, clean thought and action.
- If you’re trying to do or not do something in your trading and you’re not succeeding, you need to shift something. Ask yourself, “What would I need to believe in order to do or not do this?” “How would I have to interpret this event in order to handle it differently?” “What are my real underlying intentions in regard to this situation?” “How would I have to feel about myself in order to succeed at this?”.
- Don’t try and try again. Do something different. Discipline is doing, not trying. Change your interpretations, modify a belief, alter your guidelines, allow yourself to feel differently about the consequences of the behavior you’re trying to do or not to do.
Hard work
Shortcuts rarely lead to trading success.Develping your own approach requires research ,observation ,and thought.Expect the process to take lots of time and hard work.Expect many dead ends and multiple failures before you finds a successful trading approach that is right for your.Remember that you are playing against tens of thousands of professionals.Why should you be any better ?If it were that easy ,there whould be a lot more millionaire traders.
Focus on being consistent
“It doesn’t matter what size you’re trading or how much you’re making. Put in the hard work, be disciplined, and the consistency will come. Once you have that, then you cant start worrying about increasing your size”.
The Power of Regret
Everyone knows that chasing price is usually not beneficial, we either end up catching the move too late, or we get poor trade location, which makes it more difficult to manage the trade.
However, there are other forms of chasing that are just as common, maybe more common, and just as counter-productive. As a trading psychologist I see these all the time.
Traders who are not profitable are often too quick to chase after new set-ups and indicators, or a different chat room, if that’s your thing. Obviously, we need to have a trading edge, whether it is from the statistical perspective of a positive expectancy, or simply the confidence in a particular discretionary strategy such as tape reading, following order flow, market profile, etc.
Chasing a trade is the fear of missing out. The fear of missing out is associated with various emotions, including regret. In my work with traders and in my own trading, I’ve seen the incredible power of regret. There’s a lot of talk about fear and greed in trading, but the power of regret is often overlooked. Some of my own worst trades, and those of my clients, often have a ‘regret from missing a prior opportunity’ component. When I finally finish my book on the psychology of financial risk taking, I will include much about this overlooked but very powerful emotion. (more…)
Characteristics of Profitable Traders
They are experienced – Probably the most horrifying and worst myth shot out to anyone considering trading for a living is that you will compound millions in an extremely short amount of time. The only true way to make every day profitable comes through experience, and countless hours learning is crucial to longevity of success.
They know the damage they are capable of – Notice I didn’t say potential or profits here. The best traders I know of understand their limits, and seem to focus more on what can go wrong than what can go right. They are not easily convinced of lucrative outcomes, and have a very high sense of self-awareness.
They trade to make money, not to be right – They understand the strengths and possible pitfalls of what it is they do for a living, and use that knowledge to curb their emotional output.
They have an edge and know how to use it – They understand that without it they wouldn’t last long
They have a gameplan, and follow it explicitly – Each trade is planned and opportunities are scouted for before any trading takes place. They steer away from the killer of all killers: overtrading.
They manage risk – Regardless of how much conviction they have on a trade, they will still do what they can to avoid the potential of any losses and understand rule #1 about trading: anything can happen.
They work obsessively – They follow each turn, each piece of info that comes out in regards to their trade, and follow any underlying information relevant to failure or success.
They only access the best information – Information rules in trading, and having some of the best translates to money. Using the wrong information leads to failure.
They think about the trade, not the money behind it – Focusing on money can destroy your means to objectively assess the trade itself.
They are constantly learning – Just when you think you know it all about trading, a new curveball gets thrown your way, not to mention there are continued means and methods to be learned about making money. Even the most highly successful trader I ever knew, a multi-billion dollar portfolio manager, has a team of fundamentalists and technicians come in to train and retrain himself and his traders.
They are active – Activity sparks creativity, a very crucial part of trading.
They have patience – They understand that the money will come, but everything needs to be in place, first.
Ain't that the truth…
India Media engages Sherlock Homes / Detectives ?? !!
See this Screen-shot from CNBC Channel. Every Indian should ask what are these mysterious “SOURCES”. Is it a Ghost or any Jaadugari ??? What are its authenticity, what are its accountability. In the name of Media anything can go on. But if any individual genuinely gathers and collaborates facts about a forthcoming event he would be branded as Insider Informer. This Anarchy and Media barbarianism will not meet the eye of our regulators. They are so much afraid of Media Spying !!!
To catch Saddam Hussain in Iraq, US spent massive forces and Billions of Dollors. To catch Veerappan in our own backyard Indian Govt took a Decade. LTTE chief Prabhakaran was untrappable for several years. All Governments should abort their CID Teams and engage these Media Source gatherers for catching the invisibles !!!!!!!!!!!! Else ban this Malady. Highly DEPLORABLE.
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Anirudh Sethi/Baroda/India
Thought For A Day
