How many times have you broken the rules?
For many traders, promising to follow rules doesn’t work for long. One reason is willpower fatigue, a well-documented phenomenon. I regularly receive emails from traders who are very bright and hard working – often with a degree from a top school or a successful prior career– and they are so frustrated with themselves about ‘breaking rules’ in trading.
For most traders, the work required to succeed is not what was expected. Trading discipline is not about willpower to follow rules. It seems like that on the surface, and it sort of is in the beginning of one’s trading career, but there are three reasons why simple willpower is not the answer for long-term success:
First, discretionary trading means by its very definition that we must use our judgment to make a decision – not simply use willpower to follow a rule. (more…)
“What actually registers in the stock market’s fluctuations are not the events themselves, but the human reactions to these events. In short, how millions of individual men and women feel these happenings may affect their future.