Deciding to be a profitable financial trader is the first step in becoming one. Trite you say? Not really. Missing this one step or doing it out of order xplains why 90% of brokerage accounts go to zero within the first year, many doing so in the first 4 months!
In addition to arbitrarily deciding to be a profitable financial trader, a more powerful and lasting way is to use psychological conditioning on yourself so that you CONSISTENTLY decide that you are a profitable trader Here’s my interpretation of the method for doing this that I learned from the famous success guru I alluded to in my comments two blogs back.
First, write out the sentence below on a piece of paper.
“FROM THIS MOMENT FORWARD, I AM A PROFITABLE TRADER”.
Second, consider the pain you have experienced before because you have not consistently thought of yourself as a profitable trader. Imagine experiencing that again in the present and future. Do this for 30 seconds. Notice how you feel as you do that. (more…)
Know yourself– Understand what style fits your personality. Can you hold a position for a few days or only a few hours? Are you okay with larger draw downs or can you only take small ones? Are you more comfortable trading pullbacks or breakouts? Most importantly, don’t try to use a style that doesn’t “fit” your personality.
Educate yourself – But don’t over educate yourself or fall into the trap of reading to many biographical trading books. They may be entertaining, but you will learn little about the current state of trading. Stick to my ”Holy Trinity” of books “How To Make Money In Stocks” by O’Neil, “The Disciplined Trader” by Mark Douglas, and “The StockTwits Edge” by Howard Lindzon. The rest you can learn from online trading communities and blogs.
As a trader you must have three pieces working in synch. Your equipment, your trading tools, and your mind. The Art of War by Sun Tzu is a book that has been applied to every facet of human experience. While originally meant to be a book that taught war strategies the lessons it imparts can and will change your life. (more…)
There is the famous old adage that as a trader you should cut your losses short and let your winners run.
The best are able to do this.
BUT it’s a very easy thing to intellectualise and yet quite another thing to execute in the real world. After all if it was so easy there wouldn’t be all the writers, books, blogs, tweets, coaches, mentors etc in the trading world. They would be obsolete.
HOWEVER IT ALSO APPLIES TO LIFE AWAY FROM THE CHARTS.
The ego and subconscious are often key adversaries to us gaining flow in our lives and achieving abundance. This is true in both trading and normal life.
If you are unwilling to accept you are wrong and move on it is all too easy to not keep your losses small. (more…)