Archives of “telling the truth” tag

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You are Accountable

  
  Education
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Traders like to think that they only need to be accountable to themselves in order to get the best out of their trading. But it has been my experience that most traders fail miserably at this task.  So why are traders not able to do this?

They do not want to:

  • Be wrong
  • Admit that they are changing their rules
  • Face up to the fact that they do not have good rules
  • Realize that they need psychological help
  • Realize that they do not have what it takes

If you are committed to doing whatever it takes to follow your rules to reach a higher level of profit, you should consider asking someone to help you with this task if you are not doing a good job of it yourself.

Who could take on the role of a trader’s accountability?

  • A significant other
  • A friend
  • A trading buddy
  • A teacher
  • A coach

What would a person need to help you be more accountable?

  • A clearly defined set of rules from you
  • Your commitment to telling the truth to them
  • An accounting of the trades you took
  • Why you think the trades you took were good opportunities
  • The risk/reward ratios before the trade
  • The money management procedure you followed
  • Whether or not you followed your rules
  • The lessons you learned
  • And at the four month periodical review, the changes you would make and why

Reward or punishment

There should be a clearly defined predetermined punishment or reward that both of you agree upon for not following your rules.  Here are some examples of punishments or rewards to consider.

Punishment

  • No trading the rest of the day
  • Walk around the block before taking the next trade
  • Twenty push ups
  • Limit the size of your trades for the rest of the week

Rewards (more…)

"Truth and Trading"

  
  Education
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1. Truth: Truth is an absolute value. Some things are true in all places and times. Resisting evil, for example, is always right.

2. Justice: Justice consists of treating others as one would wish to be treated. “Do unto others as you would have them do unto you” summarizes this concept of justice.

3. Courage: Courage means standing up for justice.

4. Moderation: Nothing should be carried to excess.

5. Wisdom: Wisdom enables a person to know what justice is, to recognize when courage is required, and to do what is right.

So how do these values play out in our trading? In this column, let’s explore truth as it applies to your trading.

One of the clear, clean things about trading is that truth is immediately and finally manifested. The price goes up or down or nowhere. Your trade or position is profitable or not. You can’t spin it any other way. You’re right when you make money. You’re wrong when you lose money. That’s just the way it is.s

There are also other truths involved. You just got lucky. You have a robust and proven method for trading that you can rely upon over time. Your methods are flimsy at best, unpredictable at worst. You have no method or you have a million methods which amounts to the same thing. Your impulses frequently and easily override your methods, or you rigidly apply your rules even when you clearly should not.

You keep clear records so you can assess what works best, or you don’t and at the end of the day (or the week or the month), you have no idea. Your record of action is either clear or murky. To correct it, it needs to be clear.

You need to tell yourself the truth as you go along. No excuses. No complaints. No trumped up stories. If you can truthfully analyze your trading mistakes as well as your trading strengths, you can make adjustments, and develop a personal style that will lead to trading success.

Telling the truth about each day’s (week’s, month’s) trading doesn’t mean you have to be brutally cruel to yourself or gloomy about your trading. What it does mean is that you don’t have to do that again, and you can optimistically look forward to the next day’s trading. You will know the truth, and the truth will make you free.

You want to keep your trading in true alignment with any known or possible clues as to the on the ground truths in relevant areas. There are fundamental truths, technical truths, methodological truths, inter-relational truths, and personal truths. The closer you can get in any or all of these areas, the better your prospects. You will seek to know the truth, and those truths will power your trading.

Did You Know

  
  Education
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Know that the market never lies.I have met so many liars in the stock market business over the past 15 years. I think that many of them actually believe what they are saying but, the truth is, people’s judgment is clouded by greed.The stock market is a giant polling mechanism allowing people to cast their opinion with their money. If you think the stock market is going up, you buy. If you are right, you make money. It is a simple and powerful machine that determines value and, since no one wants to lose money, it is very efficient at telling the truth.The truth may change from one moment to the next but one thing will not change. Arguing against the market is a fast way to lose money.

Truth

  
  Education
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“Truth kills those that run from it “-Persian proverb

Traders must be able to face the truth.Great traders have learned these lessons early in their careers.Roy Longstreet in his classic book view points of a Commodity Trader started that “the first mistake teaches -then second mistake kills !”

Facing the truth in trading is necessary to prevant the consequences.Truth is necessary at all levels of trading.It is just as important to the novice as it is to the  seasoned veteran.The main difference lies in the ability to face the truth.

Truth seems so somple !But the psyche can do amazing tricks through rationalization.Some of these tricks seen to have no other purpose  then to prevent you from seeing the reality of the truth.The Bible states -“The truth shall set you free “Every religion has a saying echoing the same theme.Overcoming not facing  the truth can be accomplished by writing down the pros and cons of telling the truth.Once it is committed to paper the decision should become self-evident.

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