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bootstrap

I Look Back Now and Wonder

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I wasn't sure where to put this, so the powers that be can move it if they see fit. I put it here for anyone who is just starting out and wondering what it really takes to become part of that elite club of profitable traders.

 

I lurk on several trading forums. I join a few and make a few posts. One thing that I rarely see is the painful path one took to becoming successful. So for all you beginners here is what becoming successful took. For my fellow brethren that are already in the club have a good laugh.

 

The markets had always lured me as a kid. I would read the paper and make predictions. Sometimes they were right; sometimes not. Then one day I got that famous commodity-trading flyer, sent my money off and took the plunge.

 

My first stab at trading was commodities and I started with $5k in 1991. I was using the strategy as outlined by the guru. The account was gone within a few months. Well that didn’t work. I thought, people do this everyday and make money why not me.

 

So off to the library. I read every book the Memphis library had on trading and investing. I paper traded the strategies I found while I built my bankroll back up. I learned exits, set-ups, position, expectancy, market psychology, and portfolio management. I soon realized that I was reading the same thing over and over no matter which book I checked out.

 

Time to build my strategy. I am ready to do this. I bought a new computer, Metastock Pro 6.0, and opened an account with $30k. Its 1995, and this is my shot. By 1997 I was toast again. The family life went to hell in a hand basket, and I thought I could trade through the difficult times. The result was an account with a balance of $2500.

 

Back to the drawing board. Took care of the personal stuff. Lived like a monk raising capital. Worked nights and watched the market during the day. Took a second job on the weekends to raise more money.

 

Then one day out of the blue, the little red and green candles started to make sense. I saw patterns develop over and over in the same spots. I placed a trade and made a profit. But I had done this before. I removed the MACD from my charts. Placed another trade and made a profit. Maybe I am on to something. Removed the channel indicator that I stumbled across. I could still see the action and new what the MACD was doing and where the action was in the channel without them even being on the chart. I even stopped drawing trend lines.

 

It was just me and the screen. I planned every trade. I knew exactly when, where, and why I entered and exited. I was patient. I became a predator. Lurking and waiting. I took every shot the market gave me. If it started to go wrong, I got out quick and waited. If the market did not give me an opening, oh well. There is always tomorrow.

 

By the fall of 1999, I was consistently profitable and have been ever since. For those that are waiting for the sales pitch, there isn’t one. For those that are waiting for me to expose some great secret, well there isn’t one of those either.

 

What I will give you are a few simple pointers that I learned the hard way. And the sad part is, most will stilll learn these the hardway.

 

1)Take everything you read with a grain of salt. That includes this post.

 

2)Never pay for a system. It is just not that easy.

 

3)If something comes up in your life that is distracting, stop trading.

 

4)Plan every aspect of your trade down to the smallest detail, and plan for every possible outcome.

 

5)Develop your own strategy. Don’t let someone tell you that you can’t trade a simple moving average if you truly believe you can.

 

6)Test the strategy in the market that you will be trading. If you like the results, trade it in another totally unrelated market and see if it still holds up.

 

7)Paper trading is ok, but there is nothing that truly tests the strategy like hard earned cash.

 

8)You will have to make sacrifices in order to make it. I still do. In the middle of my learning period I was working 18 hours a day during the week and 12 on the weekend.

 

9)You are responsible for everything when it comes to trading. That includes stop running, bad fills, limit moves, your PC crashing. I mean everything. See #4

 

10)And last but probably most important, don’t be afraid of failure. Just do like Edison and go, “Well that didn’t work”.

 

Good trading to you all.

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you are quite welcome. i am about to sign off and head to florida for a few days. i will check back in with you guys when i get back home on wednesday morning.

 

Just got back from a whirlwind tour of the Wild West counties myself, think you will find that vast majority of successful trader(10%) go through the many phases you have described (Market Wizards testimonies), then there are many (90%)who get trapped in the eternal search for the holy grail.

Anyway have a good break in Florida, looks like you deserve it.

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Great post.

 

I think it's important new traders (and old traders) realise how much there is to do for point #4.

 

Do you have an plan for when your trading software goes down?

What about when the exchange goes down?

Do you know how to hedge your trading instrument/size and do you have the excess capital available to?

Do you have another brokerage account if you can't access your current one?

PC Crash?

Internet Crash?

Your local phone exchange crash? (Yes, I actually have had that happen, and yes I was in a position.)

Power outage?

Godzilla?

 

You get the drift.

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Brilliant post Bootstrap.

 

You deserve all your trading success and $$$$'s you make, for never giving up.

 

Do you have a $49 e-book for sale ? ................ only joking :o

 

As anyone with half a brain can see from bootstrap's history, there is absolutely no substitute or short-cut to trading profits apart from years and years of blood, sweat and tears, trial and error and mkt experience.

 

Tawe

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Man you guys have been busy since I was out. Vacations are never long enough and as usual, I had to check in on the markets while I was relaxing. Called my trading partners a dozen times, glanced at the ticker scrolling across the bottom of the radio when i could and listened to CNBC all the way down to get my fix. Drove the girlfriend crazy.

 

As you can tell there was alot of banging my head on my desk during those early days. Everytime I thought I was over the hump, I ran into another wall that had to be climbed.

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Man you guys have been busy since I was out. Vacations are never long enough and as usual, I had to check in on the markets while I was relaxing. Called my trading partners a dozen times, glanced at the ticker scrolling across the bottom of the radio when i could and listened to CNBC all the way down to get my fix. Drove the girlfriend crazy.

 

As you can tell there was alot of banging my head on my desk during those early days. Everytime I thought I was over the hump, I ran into another wall that had to be climbed.

 

I'm sure your post is an inspiration for many of us.

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hi bootstrap. thats a good one. gone thru myself way back in 1988. I was trading then with the illegal operating fx company in my country malaysia and in fact it is still illegal to trade spot fx here. at that time I didnt know that they are bogus operator. but grateful for the intro to spot fx. now Im trading with a foreign bank in singapore.

 

I started having faith and deep believe that spot fx trading is my only way to be wealthy, I mean truly wealthy. It seems clique and found that its so easy making money from fx. I believe most important is your own faith and believe. started with usd 1000 in 10 months have my merc 280se then in cash. no one believe it ! the believe must be deep rooted inside every trader heart's that IT IS SO EASY MAKING MONEY FROM SPOT FX TRADING OR WHATEVER MARKET THAT YOU ARE TRADING. my personal experiences, I sense that the market is talking to me for every move. I do meditate and other mind calming activities. I also believe our inner soul know the truth all the time.

 

I notice most traders do not have the right attitude towards the market, they seem to curse when losing instead of learning what went wrong. never ever curse the market, ALWAYS BLESS AND HAVE DEEP GRATITUDE. HAVE FUN AND ENJOY EVERY SINGLE MOMENT.

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I started having faith and deep believe that spot fx trading is my only way to be wealthy, I mean truly wealthy. It seems clique and found that its so easy making money from fx. I believe most important is your own faith and believe. started with usd 1000 in 10 months have my merc 280se then in cash. no one believe it ! the believe must be deep rooted inside every trader heart's that IT IS SO EASY MAKING MONEY FROM SPOT FX TRADING OR WHATEVER MARKET THAT YOU ARE TRADING. my personal experiences, I sense that the market is talking to me for every move. I do meditate and other mind calming activities. I also believe our inner soul know the truth all the time.

 

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Great post, I love it. I've noticed over the last year and a half it really comes down to passion. Show me a trader who hates his job, and I'll show you a trader who will never make it ;)

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Great post, I love it. I've noticed over the last year and a half it really comes down to passion. Show me a trader who hates his job, and I'll show you a trader who will never make it ;)

 

Ha. What about a trader who hates his day job and is working his/her ass off to get out of said day-job to trade full time for a living? :)

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Ha. What about a trader who hates his day job and is working his/her ass off to get out of said day-job to trade full time for a living? :)

 

By job, I meant as a trader :o

 

But I know what you mean, because I'm in that exact situation right now :angry:

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Ha. What about a trader who hates his day job and is working his/her ass off to get out of said day-job to trade full time for a living? :)

 

Sledge, I reckon that's probably getting very, very close to the definition of passion!

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I guess it is now time to explain the "Wonder" in the title.

 

I sometimes look back and wonder if I had to do it all over again, "Would I?"

 

Would I spend almost 8 years learning to do this? Would I let my desire to do this cost me a marriage? Would I let my desire to do this cost me thousands of dollars? Sleepless days and nights? Friends?

 

To be successful, I thought I had to put my whole heart and soul on the line.

 

I was wrong.

 

And the answer to would I do it all over....YES. Just a little different.

 

It all worked out in the end. The friends are still there and I am close to the ex even though we are not married.

 

I would spend more time with the family and friends. I would listen to what they had to say, even if I disagreed. Explain that this is what I wanted to do. That this was what I was born to do.

 

But just like going to medical/law school, sometimes your future has to come first. Don't be afraid to take a stand if you have too. There will most likely be personal sacrifices. That is just part of the fee you have to pay.

 

Hopefully they will not be as severe as mine.

 

Chris

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Well, this is the real wonder here. Unlike medical or law school, you know when you will graduate in certain amount of years. The real wonder in trading is that you don't know when you will graduate. My question to all of you is how do you keep the faith and keep on running when you don't know how far you are from the finish line ?

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By job, I meant as a trader :o

 

But I know what you mean, because I'm in that exact situation right now :angry:

 

I'll give you an oar brother- and we can row the boat together!

Aaron

 

P.S. Ed- Passion is an understatement! ;-)

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