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EGO

  
  Education
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There is no place for arrogance on the trading floor. The stock market has the uncanny ability to identify and humble arrogant traders. The best traders respect the market at all times. Traders are most susceptible to arrogance after an extended winning streak. It’s amazing how weeks of disciplined trading can be wiped out by one bad day. Arrogance is a virus in your trading, as it eats away at the edges of your discipline. Without proper discipline, the market will eat you for lunch.

Trade Management & Quotes For Traders

  
  Education
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Trade Management

  • Let winners run. While momentum is in phase, the market can run much further than might be expected.
  • Corollary to that rule: Do not exit winners without reason!
  • Be quick to admit when wrong and get flat.
  • Sometimes a time stop is the right solution. If a position is entered, but the anticipated scenario does not develop then get out.
  • Remember: if one thing isn’t happening the other thing probably is. Historically, this has never been good for me…
  • Be careful of correlations. Several positions can often equal one large position bearing unacceptable risk. Please think.

Trading Quotes :

  • I am responsible for risk management, money management, trade management, doing the analytical work and putting on every trade that comes.
  • I am not responsible for the outcome of any one trade. Markets are highly random. I do not have a crystal ball. I am not as smart as I think I am.
  • Risk management is the first and last responsibility. I can make almost any mistake and be ok as long as I do not violate my risk management parameters.
  • Opportunity comes every day. Do not neglect the work. Must do analysis every day.
  • Opportunity comes every day. Get out of poor positions. Move on.
  • I am a better countertrend trader than a trend trader. Sometimes the crowd is right, and they will run me over at those times if I’m not quick to admit I’m wrong.
  • If you’re going to do something stupid, at least do it on smaller size.

10 Questions for Traders

  
  Education
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Traders must have rules and trading plans because in the heat of trading when emotions flare up that is when greed, fear, and ego can easily hijack the trader. Traders all have many different conflicting parts that can interfere with trading execution. The need to be right, the need to make money, the fear of loss, and the greed of making a lot of money can take over any trader that does not have a disciplined approach that is created before the day begins. Mechanical systems, trading rules, along with positions sizing and risk management factors can keep a trader safe from making huge mistakes.

Here are the top 10 Questions Traders must ask to protect them from themselves.

1. Where does the price of my trading vehicle have to go to prove I was wrong about my entry?

2. How much is the maximum I will lose on the trade if I am wrong?

3. What are my rules for entries?

4. How will I exit my winner to bank profits?

5. What is the current trend of the time frame I trade in?Where is my best entry point to trade in this direction? (more…)

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