There are young people in the market that are really bad traders and there is also old traders that are very good, but there are no old bad traders in the market because they went broke and gave up a long time ago.
You might be a bad trader if……….
…your primary method is to try to call tops and pick bottoms.
“Don’t try to buy at the bottom and sell at the top. It can’t be done except by liars.” -Bernard Baruch
You might be a bad trader if……….
…instead of benefiting from the 200 point run in Apple this year you actually lost money by fighting the trend.
“Cardinal Rule #1 is to sell short only during what you believe is a developing bear market, not a bull market.” -William O’Neil (more…)
Patience is important not only in waiting for the right trades, but also in staying with trades that are working. The failure to adequately profit from correct trades is a key profit-limiting factor. Quoting again from Lefevre in Reminiscences, “It never was my thinking that made big money for me. It was always my sitting. Got that? My sitting tight!” Also, recall Eckhardt’s comment on the subject: “One common adage … that is completely wrongheaded is: You can’t go broke taking profits. That’s precisely how many traders do go broke. While amateurs go broke by taking large losses, professionals go broke by taking small profits.”