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10 Famous Quotes for Trading

  
  Education
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There are some meaningful and aspiring quotes that i have read from books or i heard from my coaches. Today i’m going to share with you guys. Hope that it will inspire you and you might use the quotes as a daily reminder or as a form of motivation.

“Trading is hardwork, laborious and boring, just like any other jobs. If you are excited about it, you are gambling” by Conrad

“There is no calamity greater than lavish desires. There is no guilt than discontentment. And there is no greater disaster than greed.” by Lao Tze

“Its not about being right or wrong, rather, its about how much money you make when you’re right and how much you don’t lose when you’re wrong” by George Soros

“Luck is what you have left over after you give 100 percent” by Langston Coleman

“In the business world, the rear view mirror is always clearer than the windshield.” by Warren Buffet

“Experience is a hard teacher because she gives the test first, the lesson afterwards.” by Vernon Sanders Law

“Human beings, by changing the inner attitudes of their minds, can change the outer aspects of their lives.” by William James

“The only that overcomes hard luck is hard work.” by Harry Golden

“A goal without a plan is just a wish.” Antonie de Saint-Exupery

“If i can do it, so can you” by Adam Khoo

15 Fundamentals To Win Stock Market Battle

  
  Education
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Gerald Loeb was a founding partner of E.F. Hutton, a renowned and successful Wall Street trader, and the author of the books The Battle For Investment Survival and The Battle For Stock Market Profits.

Mr. Loeb promoted a contrarian view of the market as too risky to hold stocks for the long term in direct contrast to many of his generation. At the time, many considered Loeb’s comments heresy to the buy and hold doctrine so common among many in the industry. While Loeb never had the opportunity to trade in an environment now ruled by quants, algorithmic trading and massive government intervention, his wisdom and insight is still applicable in today’s environment. After all, the more things change, the more they always stay the same!

Based on his two books, here are 15 fundamentals Loeb argues that you need to understand to win the battle not only against yourself, but also against the market:

  1. What everyone else knows is not worth knowing.
  2. Stocks are always way overvalued in a bull market and way undervalued in a bear market.
  3. The best stocks will always seem overpriced to the majority of investors.
  4. Expectation, not the news itself, is what moves the market.
  5. Three basis elements should be considered when evaluating a stock – 1) quality (fundamentals, liquidity, management), 2) price, and 3) trend (the most important).
  6. Stocks act like human beings and go through the same stages and phases as people do, including infancy, growth, maturity, and decline. The key in trading is to be able to recognize which stage the stock is in and to take advantage of that opportunity.
  7. Pyramid your buys – start with an initial position and then add to it only if the trade moves in your favor.
  8. The more experienced and successful you become, the less you should diversify.
  9. Traders must always resist the urge and temptation to change their strategies for each and every different market cycle.
  10. To succeed in trading you must 1) aim high, 2) control the risks, 3) be unafraid to keep uninvested reserves and 4) be patient.
  11. Successful traders are intelligent, they understand human psychology, they practice pure objectivity, and they have natural quickness.
  12. You must always trade with the actions of the market and not simply by how you might think the market should trade.
  13. Knowledge through experience is one trait that separates successful stock market speculators from everyone else.
  14. The stock market is more an art than a science and far more complex than most people understand.
  15. Always sell when you start patting yourself on the back for being smarter than the market. (more…)

Greed, Fear, Hope, and Regret

  
  Education
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There are four psychological states of emotions that drive most individual decision making in any market in the world. They are greed, fear, hope and regret.

Since the stock market is made up of individual human beings who tend to act in similar manners, a group is formed. It is only the group’s opinion that matters during a trend, but it is the individual trader’s job to identify the subtle clues as to when a market is about to shift direction.

The clues are there, but they are subtle. An awareness and detailed understanding of these emotions is what keeps the astute technical trader out of trouble by providing a means to identify individual weaknesses. We shall now take a closer look at these emotions, and provide examples of how they influence a trader’s ability to consistently make money.

What is Greed?

Greed is commonly defined as an excessive desire for money and wealth.

In trading terminology, it can specifically be defined as the desire for a trade to provide an immediate and unrealistic amount of profit. When greed sets in, all a trader can focus on is how much money they have made and how much more they could make by staying in the trade. However, there is a major fallacy with this type of reasoning. A profit is not realized until a position is closed.Until then, the swing trader only has a POTENTIAL profit (aka. “paper profit”). Greed also frequently leads to ignoring sound risk management practices.

What is Fear? (more…)

5 Trading Quotes

  
  Education
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Traders who are eternal optimists get absolutely killed because they have a habit of staying in long after the trade has turned into a loser. – Dan Zanger
Good trading is not about being right, it’s about trading right. If you want to be successful, you need to think of the long run and ignore the outcomes of individual trades. – Curtis Faith
Human beings are risk seekers when faced with negative outcomes and risk averse when faced with positive outcomes.
Great traders offer no excuses.
The less I cared about whether or not I was wrong, the clearer things became, making it much easier to move in and out of positions, cutting my losses short to make myself mentally available to take the next opportunity. – Mark Douglas

Trading Wisdom

  
  Education
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Traders who are eternal optimists get absolutely killed because they have a habit of staying in long after the trade has turned into a loser. – Dan Zanger
Good trading is not about being right, it’s about trading right. If you want to be successful, you need to think of the long run and ignore the outcomes of individual trades. – Curtis Faith
Human beings are risk seekers when faced with negative outcomes and risk averse when faced with positive outcomes.
If you can’t wait for good setups, you will be ready for them with less cash to trade. – Dan Zanger

The 12 Steps and Counting

  
  Education
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I admitted I was powerless over my affliction to taking small profits.

I made a decision to turn myself over to the care of those who affably might help me as God has helped others.

I made a searching inventory of all the losses I have taken.

I admitted to other human beings especially the spec list the nature of my wrongs.

I am ready and willing, but perhaps not able, to remove these defects.

I humbly ask all my supporters and friends to help me remove them. (more…)

Money solves all of your problems.

  
  Education
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It is often said, trading introduces you to yourself. I was in my second year of trading when I heard that phrase.  She would go on to ultimately teach me much about life and myself.  The benefit of being in my early 20′s and teaching people in their 40′s and 50′s.  I helped them with trading, they helped me grow up.

What that phrase means is that who ever you are that day will show up in your trading.  This of course comes in varying degrees.

In many professions your emotional state may not effect your earnings or employment.  In trading, a “bad” day can  create a cascading effect. You lost when you should have made money.  You created a bad habit.  Losing doesn’t trigger the right response, etc.

A trader views the market through themselves.  Now, most of the time it is little things that can be easily passed over.  Human beings are always going to have to deal with things they rather would not have to.  Every person has a bad day. (more…)

Happiness and Trader

  
  Education
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“Happiness is not to be achieved at the command of emotional whims. Happiness is not the satisfaction of whatever irrational wishes you might blindly attempt to indulge. Happiness is a state of non-contradictory joy—a joy without penalty or guilt, a joy that does not clash with any of your values and does not work for your own destruction, not the joy of escaping from your mind, but of using your mind’s fullest power, not the joy of faking reality, but of achieving values that are real, not the joy of a drunkard, but of a producer. Happiness is possible only to a rational man, the man who desires nothing but rational goals, seeks nothing but rational values and finds his joy in nothing but rational actions. Just as I support my life, neither by robbery nor alms, but by my own effort, so I do not seek to derive my happiness from the injury of the favor of others, but earn it by my own achievement. Just as I do not consider the pleasure of others as the goal of my life, so I do not consider my pleasure as the goal of the lives of others. Just as there are no contradictions in my values and no conflicts among my desires—so there are no victims and no conflicts of interest among rational men, men who do not desire the unearned and do not view one another with a cannibal’s lust, men who neither make sacrifices nor accept them. The symbol of all relationships among such men, the moral symbol of respect for human beings, is the trader. We, who live by values, not by loot are traders, both in manner and spirit. A trader is a man who earns what he gets and does not give or take the undeserved. A trader does not ask to be paid for his failures, nor does he ask to be loved for his flaws. A trader does not squander his body as fodder, or his soul as alms. Just as he does not give his work except in trade for material values, so he does not give the values of his spirit—his love, his friendship, his esteem—except in payment and in trade for human virtue, in payment for his own selfish pleasure, which he receives from men he can respect. The mystic parasites who have, throughout the ages, reviled the trader and held him in contempt, while honoring the beggars and the looters, have known the secret motive of the sneers: a trader is the entity they dread—a man of justice.”

Trading psychology

  
  Education
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The market is always right–except at significant tops and significant bottoms.

Keep and open and flexible mind. When in doubt, get out.

If you must have a guru, take him or her with many grains of salt

Do not add to losing positions.

Try every day to make yourself stronger, better and more integrated as a person.

Stay true to yourself. Lying to yourself and others, and trading on hope and prayer do not work

Most importantly, accept and recognize that you are not perfect. You are human and are going to make mistakes. Trading is the only profession where losing is actually winning. BUT— unless you accept mistakes as mistakes and learn from them, you will not progress and be upside down. Unless you are able to get your trading brain out of the cave you will not accumulate regret. It is only through the true acceptance of a mistake as a mistake that we accumulate regret. This is how we learn and grow as traders and human beings.

Revolutionary Trading Psychology

  
  Education
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Everyone thinks the market is a game of numbers. We use complex models, umpteen oscillators or retracement calculations and even a fundamental analysis of supply and demand – all based in numbers and about numbers.

But in reality, the numbers of the market are but an illusion.

Markets are only the vacillating prices that other human beings, using the same mathematically based tools, are willing to pay. For example, what can be expensive one day can be very cheap the next if a trend has ensued.

It is only a matter of perspective. And perspective is a matter of the judgments you make.

Judgments on the other hand will be influenced by both impulsive feelings and by intuitive feelings – or pattern recognition. The trick is to have all the data on the table so you can tell the difference.

In order to do this, us market participants need to do a couple of things – give up the notion of a iron-clad trading plan based purely on historical probabilities and replace it with a trading plan based on historical probabilities (yes you read that right) AND a systematic way to leverage your judgment under uncertainty. This way you can make a decision about factors that may now be in play for the future probabilities. I mean who thought the VIX could stay over 30 for 6 months? … I am just askin.

Now in order to do this successfully, you have got to learn to optimize your judgments – which means spending more time focused on deciphering and understanding them than you spend on deciphering and understanding the charts.

This is revolutionary trading psychology – and it works.

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