One of the first books I read in this business oh-so many years ago was Stock Market Wizards. It had a profound impact on my thinking about trading, psychology, risk, capital preservation, etc.
- All successful traders use methods that suit their personality; You are neither Waren Buffett nor George Soros nor Jesse Livermore; Don’t assume you can trade like them.
- What the market does is beyond your control; Your reaction to the market, however, is not beyond your control. Indeed, its the ONLY thing you can control.
To be a winner, you have to be willing to take a loss
HOPE is not a word in the winning Trader’s vocabulary;
When you are on a losing streak — and you will eventually find yourself on one — reduce your position size;
Don’t underestimate the time it takes to succeed as a trader — it takes 10 years to become very good at anything;
Trading is a vocation — not a hobby
Have a business/trading plan
Identify your greatest weakness, Be honest — and DEAL with it
There are times when the best thing to do is nothing; Learn to recognize these times (Nothing Doing)
Being a great trader is a process. It’s a race with no finish line.
Other people’s opinions are meaningless to you; Make your own trading decisions
Analyze your past trades. Study what happened to the stocks after you closed the position. Consider your P&L game tapes and go over them the way
Vince LombardiBill Parcells reviewed past SuperbowlsExcessive leverage can knock you out of the game permanently
The Best traders continue to learn — and adapt to changing conditions
Don’t just stand there and let the truck roll over you
Being wrong is acceptable — staying wrong is unforgivable (I liked this one! – BMB)
Contain your losses
Good traders manage the downside; They don’t worry about the upside
Wall street research reports are biased
Knowing when to get out of a position is as important as when to get in
To excel, you have to put in hard work
Discipline, Discipline, Discipline !