February 4, 2019 - Page 11 of 19 - Financial Occultist

After the trader has learned the mechanics of trading, we then enter into the world of Greed & Fear.

When you have your trading system in place, and know all about technical analysis, money management, probability, risk to reward and all the other components needed to be a successful trader, we are then introduced to our two friends Mr Greed and Mr Fear.

Greed and Fear = Emotions

It is sad to say this is the area that most traders cannot master, and if there was ever a secret attached to trading, this has to be one of the biggest, just behind money management.

If the trader can stay focused, and still show discipline to take the trades their system is generating after a string of losses then this is a quality that will result in becoming a great trader.

Most traders will be deeply affected after taking a few hits, and their discipline will waver by making changes to the plan. These changes mainly come in the form of exiting too early, cutting the trade’s potential for the need to be correct. Not realizing that doing this reduces the profits on the winners, and places the whole money management plan in jeopardy.

Handling a string of losing trades is not the only hazard because landing on a winning streak will places demands on your discipline. (more…)

What Can We Learn From Expert Gamblers?-Must Watch Video

04-Feb-19 11:36 am

Anirudh Sethi

Dylan Evans is the founder of Projection Point, the global leader in risk intelligence solutions. He has written several popular science books, including Risk Intelligence: How to Live with Uncertainty (Free Press, 2012) and Emotion: The Science of Sentiment (Oxford University Press, 2001). He received a PhD in Philosophy from the London School of Economics in 2000, and has held academic appointments at King’s College London, the University of Bath, the University of the West of England, and the American University of Beirut.

The Power of Elimination

04-Feb-19 11:24 am

Education

Anirudh Sethi

One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity.” – Bruce lee

So what do Bruce Lee and Leonardo Da Vinci have in common? They both understood, as any good trader should, the essentials of making an impact…the power of subtracting noise.

As a trader you should do the same:

1) Subtract your emotional baggage

In close to twenty years of trading, I have yet to meet ONE successful trader that is emotionally unbalanced. Bring your emotional baggage, your demons, your insecurities to your trading terminal, and you likely to make wrong decisions.

2) Subtract financial entertainment

Blue Channels and other financial media are a great source of info-tainment and you can surely learn a lot. But if you sit in front of the TV all day without having a solid plan thinking that’s what professional traders suppose to do, you virtually guarantee to trade yourself out of capital very shortly. Understand that the delivery of TV news is designed to hit the emotional part of your brain. You might benefit from shutting it off in the short run.

3) Subtract noise

Good trading is not about having 8 screens, 1500 indicators, live steaming news, Twitter feeds, and a phone line with direct connection to god. Clean up your charts to the essence, price, volume and maybe one or two indicators. Clean up your screens and eliminate as much noise as possible, go over your trading diary and identify which inputs produced the most output, then go back and close the applications that add nothing but flicking lights and funny sounds, subtract until you are left with the essence of your system. (more…)