MightyMouse

Ptcman, I appreciate your honesty. It seems to me that in spite of your love of the markets, after 11 years, you do not really want to make money in the markets or you would. It may be that you are simply happy to be around the markets whether you make money in them or not and for you that is enough. It doesn't sound like you need money If you left your job and are able to sustain yourself without an earned income. This may be an issue. When you trade, you are trading against others who want to make money and you are easy pickings because you give up your capital without a pause. In short, they do a really good job of convincing you that their position is the right one and yours is wrong. There are lots of others like yourself who trade because they love the action so you are not alone. In fact, you are in the majority. I do not know what your financial threshold is but before you reach the end of your rope, I would suggest you do something like buy a box of used books and go door to door and try to sell them all at a profit. If you can do that, then you can come back to the market and start to convince traders that your position is better than theirs. It may sound crazy but you have to do something to break the pattern you are stuck in. If you don't want to try to break the pattern then it is probably true that you are just happy to be around the market even if you continue to lose. MM

The many faces of Tams

Of course institutions use the futures market for other reasons than speculation. That doesn't mean that they enter randomly. It doesn't mean that they are right when they buy or sell or wrong when they buy or sell. All it really means is there is more size in the market. A lot of traders think that institutions are better informed. I don't think so, but that is just me. Does it make you feel badly that the money might be coming from a small trader?

You can think of it any way you like. Nothing will change the fact that when you enter a live trade, you are trading against other traders. You win if someone or some others lose. Someone else wins when you lose. You can suspect that when you enter a trade the rest of the traders, who are opposite your position, would prefer that you lose money to them. No one makes money if money isn't there to be taken. I do not think it is critical to accept this to make money trading. Some people think of it as surfing or as a video game or whatever makes them feel better.

You do not have to think that way. But, if you don't take money from other traders where do you think it comes from?

The market wants you to think you are wrong when you are right and it wants you to think you are right when you are wrong. In sum, it wants you to make mistakes. If you get those feelings when you are in a trade, you are doing exactly what the market wants you to do which means it is in control of you when you enter a trade and you will make mistakes. Profits will come to you when you are in control of yourself. MM

Matt, It may not be as obvious as the exchange of a cookie for a slice of pizza, but an exchange is being made with a certain outcome or you will not enter into the trade. Some traders know how to trade. Call them accomplished. They will trade only when they are reasonably certain that they can take money from the market. They put up their money with an expectation of getting back money plus gain. So he wins. A new trader will take a trade knowing that there is a tuition to be paid to learn and he is willing to pay that tuition because he wants to become an accomplished trader. He gets back money minus tuition plus the utility from the lesson learned, but the value of the utility for which he paid tuition, is far greater than the actual loss, so he wins. If the value he gains from the utility gets smaller and smaller and his loss does not get smaller and smaller, then he will stop trading or become a seasoned loser. A seasoned loser who has no chance of becoming an accomplished trader will continue to trade and lose. He is getting some sort of pleasure out of it (like gambling) or he would not continue trading. He is getting back money minus loss plus utility gained from trading. So he wins. Oddly enough the accomplished trader can enter a long with 10 contracts and win money from the new trader and the seasoned loser and all three can win even though 2 of them lost. Yes, I am missing quite a few reasons to trade to make this a complete analysis, such as hedging, portfolio rebalancing, and etc., but i am not going to do that in 200 words or less. You can also gather from this that the accomplished trader can only profit to the extent that the new trader and the seasoned loser continue to gain a high enough utility from trading in spite of their losses. Casinos parade hot waitresses around to keep the gamblers interested in coming to the casino. Maybe traders need hot brokers to spice up the markets and keep them here. MM

I have disagreed with Rande's statement before. Trading does come naturally. Through our social interactions, religious beliefs, and upbringing we learn to become non-traders, but we are born with the the basic characteristics needed to trade.

David, I have no fear of losing. I hate losing. I get annoyed when I lose. I certainly do not want to lose and i lose more than i win. I am not afraid to be wrong. I hate being wrong. I do not want to be wrong, and i am wrong more than I am right. I do not think i walk on water. I have no fear of losing because i risk a very tiny amount. A very bad day for me ends up being about a 2% loss in my account. Not a bad trade, but a bad day with multiple, multiple losses. Fortunately, good days are far better than bad days for me. I do know how to milk a position for almost everything that it is worth. Can things change for me? There is no doubt in my mind that they will. I hope that I can adapt when they do. I think 1-2% stops on a trade are crazy if you are day trading. It's almost a guarantee that someone will drain their account or deflate their ego to where they are afraid to trade The quickest way to reduce or remove your fear of loss is to reduce the amount you lose. You do not need years of psychotherapy. If I used 2% stops and took a few losers in a row, i would be afraid to trade too. If you can't reduce your stops to a level that you could care less about, then you probably do not have enough money to trade the instrument you are trying to trade. MM

I am not suggesting that if someone else is against you that wants to make money you will lose. That is silly. You can certainly win too and you may be the one with deeper pockets. You may be the guy gunning for the stops for all that I know. My point was that trading is all about money. Furthermore, a trader who follows his rules to the tee runs a great risk of losing if his plan is flawed from the start. There are lots and lots of traders with flawed plans. Follow the rules and you are guaranteed to lose. I have discussed this elsewhere. Second to not having enough money, a flawed plan is the greatest reason that aspiring traders fail.

David, The list of fears are a lot longer and more complicated than that. Hopefully, for your sake, they are that simple. MM

Sure, it can be looked at as a game. The only way one can win the game is if in the end, he or she makes makes more than is lost. The tactics and strategies that are used, are used to make money or lose as little as possible. There are lots of other games that can be played that do not involve money if someone doesn't want to open up that can of worms. However, in this game, as soon as you put yourself at risk, money is involved. At least one person who is opposite you at a point in time is trying to take money from the market. If there were a way to make you lose so that they can win, they would do it and not care how well you are following your plan, rules, or set up. They simply want your money. I personally think that one should really understand the money part. All the traders you trade against want your money. When you enter, you want their money. If you are winning and you don't want the money that you are winning, then its not very likely that you will be able to hold onto your gains. If you lose and don't care if you continue losing, then you will continue losing. Money. If trading ability matters, then the guy who wants the money the most, will win. It will not matter how good your set up was or plan, etc. He may sell right into support that is supposed to hold simply because he saw that traders were there who would give up their positions quickly at a loss if he pressed hard enough or better yet, they may get stubborn and add. His trade could have been a horrible trade, but it made money this time. In essence, he took advantage of your money management. If you go home at the end of the month and your wife asks you how well you did, and you tell her that you didn't make money but you followed your plan to the tee. I am sure she will agree that playing the game well is important. No doubt she will set in motion her own game. MM

Dcash, In trading money is the only thing. Money is the way you keep score in trading. It is true that a lot of people get more out of trading than just money, which is probably a justification of not making money in the same way that blackjack players "enjoy" playing blackjack while the casino picks their pocket. As a trader you have to learn how to take money from other traders before they take it from you. You are trading with other traders and collectively we all want you to leave your money behind when you exit a trade. MM

Tradewinds, I do not know if everyone struggles with fear, but i know i did. Time dampened the effect that fear had on me. It is honestly a vague memory at this point. I watched trade after trade go on to do what it was supposed to do without me because I either didn't get in, got out too early, or some combination therein. Eventually I simply got sick of it and it really didn't take long after you get sick of it. How many times can you enter a room and I scream "BOOO" and startle you before you adapt to it and expect it? MM

If you take greed to be reckless pursuit of riches, then, sure, it can be destructive. I am referring to greed simply in the sense of wanting more than you need and attempting to achieve it with patience and discipline. In which case it is not destructive. Society and religion have given greed a bad name.

You only think about fear if you are comfortable. If you are hungry or greedy enough, you will ignore the fear. If you were walking along a path and you saw horse dung, you may or may not notice that there is undigested corn in it. The thought of eating the corn wouldn't even cross your mind.However, if you were starving enough, you would examine it closely hoping to find the corn so that you can eat it. Comfort and Hunger When you have enough and are no longer hungry, then you need to become greedy. If you don't, the market will take your fat and happy ass and make it hungry again. MM

Every trader is a Noob from their first trade to their last trade. And you are right. a delta of 500 could very well mean 2 completely different things if they have very different trade volumes. Sounds like you are on the right track.

Maybe the trader is trying to make you think he is uncertain.

I start each day trading small size in CL and if I get a few winners, I will risk a great deal more on the next trade. To borrow a gambling term. I try to "parlay" my win to a bigger win. If I lose, I am still ahead for the day ( and pissed as all hell that I gave some back. I am human). To stay at the higher amounts, you are going to need to win at the higher amounts. In short, you need a lucky break. You really need to fight to get to higher levels and fight to stay there. We are trading traders who want your money as badly as we want theirs. One day you have to step up to the plate with more risk. And there is a good possibility that you are going to start losing a losing streak when you decide to step up. Reading Market Wizards, you will see that most of those guys did have a lucky break. Chances are that had they not had that lucky break when they had it, they may never have made it into that book. One bond trader who is a scalper, his name slips my mind, tells his story of one day taking 100 contracts. Before that the most he had done was 50.According to the story he started 6 months earlier with 25k. Subsequently he traded as many as 2000 contacts in tbonds. The point is that he went from 50-100 and he won with 100 and never looked back. Had he lost, he might have become a clerk at the CBOT. Personally I have gone from trading qm to trading cl, but have not been able to build enough yet to increase the starting size of my trades in CL. I see this as the quickest way. I suppose you can do it more gradually, but that could take a very long time.

I am sure that if you keep doing "extensive research" you will conclude that nothing gives you an edge over time.

Noob, People go to psychologists for years and years Most never overcome their issue. A lot never even get to fully understand their issue. Probably for most, the only issue is that they think there is an issue and there isn't. I don't have real stats, but it is very difficult to measure success in that field. Sorry that I do not have more concrete data. Maybe Rande would like to share.

Noob, Success in the psychiatric community is very low. Very, very, low. In fact, some of those guys need therapy themselves because they cannot help as many people as they would like. So, a guy that helps 2 out of a hundred is doing pretty well compared to the average guy who helps 1.5 out of 100. Would you want to work with a top person who helps 2 out of 100? 3? 10? MM

I can completely envision you on the treadmill and trading at the same time. However, in my mind you get into a bad trade and are trying to manage the trade and the speed of the treadmill at the same time. I can hear the Benny Hill music playing.

How much did he charge you?

I completely disagree with you. You need a coach who can help you as a person achieve your full potential. That coach is more than likely not going to be someone in the trading industry. A coach is someone who can bring out the most in his team. It will be hard enough for you to find a successful trader. Then, you will have to find one who is willing and able to coach.