Self-discipline = Key for Daytrading

[gethim 10]

I have 6 years of stock trading experience, tried all strutegies that can give any profit. All my life I depended from my boss or employer, but I hated all that work . So when I learned about stock trading, I really like it. I never felt so easy and relaxed, and saw my great future in trading. That was only the beginning.

Then disappointment, a lot of work, the nerves. There was a time when everything works and you earn lot, and then you lose a lot. There was no stability. I was searching everywhere for it, read many books but all was as before. Smoothly in the selection of literature, I switched to psychology, and in my trading began to notice that the stability can be provided only if there is discipline. I began to understand that this work is not for everyone

 

Stock trading is a privilege to discipline. If you'll be a manager you'll manage the others, which is 1000 times easier than manage yourself.

Self-discipline has helped me solve my problems in trading. I would like to share my story and listen to others

[natedredd10 10]

meh...to me while I love Dr. Brett's work I think "trader pyschology" is complete nonsense..

usually this type of thought in your developement as a trader comes after a random streak, winning or losing streak matters not at all, you are just looking for a variable to attache meaning to what is ultimately a stochastic process.

Of course though there is a comfort level with betting, just like there is a comfort level with women. A virgin isn't going to PUA a woman at the grocery store..just doesn't have the experience...not to say they could not but there is a comfort level that comes with repeated trial and error that has nothing to do with the outcome.

An EV+ trade ultimately comes down to your ability to front run liquidity and information, information that is almost entirely uncertain...simple but extremely complex. How comfy you are with your ability to click a mouse is one of the most meaningless variables in the equation.

[collegetrader 10]

I have a strategy with positive EV and don't care about psychology. Discipline is overrated. Just execute. SOunds to me you don't have an edge.

[pedropips 10]

Discipline is overrated

 

Discipline is everything.

 

Many military personal turn traders do very well indeed.

[brownsfan019 17]

I have a strategy with positive EV and don't care about psychology. Discipline is overrated. Just execute. SOunds to me you don't have an edge.

 

In order to execute w/o emotions requires discipline.

 

You'll find that out when you trade for a living.

[ektrader 10]

In order to execute w/o emotions requires discipline.

 

You'll find that out when you trade for a living.

__________________

 

Hi Brownsfan,

 

It's pretty clear that collegetrader nor natedredd10 trade for a living and will probably have a difficult time trying.

 

Good luck guys and Happy Trading

 

Ektrader

[chulaihuey 10]

I have a strategy with positive EV and don't care about psychology. Discipline is overrated. Just execute. SOunds to me you don't have an edge.

I am a new trader, and I have to say that at this point in my development the only real edge I do have is to be disciplined enough to stick to my trading plan. Before when a stock I was holding went down I hung on and "hoped" for the best.....Now I get rid of it like a hot potato, as long as that is in my plan.

I agree that I do not want emotions getting in the way of my trading, but for me that takes discipline. Just my opinion.....

[FulcrumTrader 10]

I have always loved this statement.......

 

"Save you from yourself"

 

Psychology and the human nature of the modern man has many embedded TRAPS. For the importance of what I present, just look at all the supposed "smarties" who just had their a$$ handed to them at the institutional level throughout the financial world. Trillions where just blown out these past years from the improper psychological relationship with known reality.

 

Human nature, even within the context of financial ascension through seeming profitable trading mechanisms, is always wide open for psychological based complete failure. The inability to interact with realtime or long term reality, through psychological misdirectives such as EGO and PRIDE alone, can in an instant set you on a perilous financial course. The decision string of actions created from wrongfully based mentalities, triggered from improper psychology, will place you on a path of doom even as you enjoy short term gains in a realm of invincibility.

 

It all goes back to "saving you from yourself", and the ability to honestly understand your own ability through improper psychology to at some point completely destroy everything you have worked very had to build.....never forget that unfortunate power that is always within you!

[collegetrader 10]

In order to execute w/o emotions requires discipline.

 

You'll find that out when you trade for a living.

 

Discipline is not useless, but very overrated. It's what people without an edge look for as the holy grail. However without EV+, discipline alone won't make you profitable. It's how people sell books like "Trader Psychology", which are in essence useless, because you still don't have a profitable strategy...

 

I may view discipline as less useful, because my strategy is much more mechanical than most other strategies I have seen on the internet. I don't need as much discipline as say, the people who trade based on "price action" or gap fills or "sentiment".

 

I view trading as a science, not an art.

[brownsfan019 17]

Discipline is not useless, but very overrated. It's what people without an edge look for as the holy grail. However without EV+, discipline alone won't make you profitable. It's how people sell books like "Trader Psychology", which are in essence useless, because you still don't have a profitable strategy...

 

I may view discipline as less useful, because my strategy is much more mechanical than most other strategies I have seen on the internet. I don't need as much discipline as say, the people who trade based on "price action" or gap fills or "sentiment".

 

I view trading as a science, not an art.

 

Like I said, when it's your livelihood on the line, things tend to be treated differently. While just playing around with charts in college as a hobby, then it's easy to talk like that.

 

If you don't believe me, join us over in the p/l thread and show us how it's done day in and day out.

[Kiwi 16]

I agree with you brownfan and recall some wise trader saying something like:

 

"If you don't believe discipline, your self-knowledge and your psychology are important then you are not betting big enough."

 

There is a size were almost everyone starts to need more than "just" an edge and money management. It combines dollars, your immediate need, and your conditioning. I'm not saying you don't need an edge but you'd be surprised how weak an edge some of the big pros consider acceptable. I generally seek a profit factor of 2 to 3 (sum of wins over sum of losses) but when you read the truthful writings of some of the current big players you discover that a 1.5 pf is all they're looking for in their edge. They seem to swap return for robustness - at least that is my current assumption.

[DugDug 10]

Discipline is not useless, but very overrated. It's what people

 

I may view discipline as less useful, because my strategy is much more mechanical than most other strategies I have seen on the internet. I don't need as much discipline as say, the people who trade based on "price action" or gap fills or "sentiment".

 

I view trading as a science, not an art.

 

I think you have answered the question - my making your strategy automatic/mechanical/systematized you reduce the need to be as disciplined on a discretionary basis.

HOWEVER - the discipline you will require is to believe in your system. To trust your system when it has losses, to not be tempted to tinker with it too much. Yet to continue to do research to improve the system.

 

Same thing - different thing?

 

I think the discipline required regardless of how you wish to define it is to regard trading as a business - it requires hard work, research and a plan - the discipline to stick to those things.

[gethim 10]

that helps me personally to improve my results in trading:

1. Schedule of the day

2. Two leading journal, the first describes all my trades, the second describes my emotional state, feelings, depression, readiness to work, fears.

3. Put specific targets and goals. Encourage or limit myself, depending on the results

4. Clearly defined rules for trade

5. Trade analysis and conclusions

[sep34 10]

Some of the previous posts reminds me of a conversation I had with a friend whom traded and also introduced me to trading about more then 11 years ago.

 

One day in a conversation with my friend, the trader mentioned above, the subject of Discipline and its influence on a trader was injected into our conversation by my friend.

I too remeber rejecting his claim that discipline is as important of a factor as he claimed. My argument was that if one is confident in his approach then discipline should not be that large of a factor, which at the time I truely believed that I was correct.

The problem with that statement is that I automatically assumes that trading is like other endeavors, where infact it is not.

I still remeber when I first realized that my friend was indeed correct--However I did not fully appreaciate his comments until I was trading fulltime many years later and had to make money to support my lifstyle.

 

Its also important to mention that when a group of people describe something as important that its importance is relative for different individuals.

Generally the more experienced a trader is, disciplin is less important and the more green(new) the trader is the more important discipline is. However disciplin is allways an important ingriedient.

[atac5922 10]

discipline is important PERIOD.

 

those who don't believe are DIGGING THEIR OWN GRAVES!!!!!

[MoreYummy 10]

atac5922, how you find this site and thread to post your first post... Just curious

 

Yes, discipline is important part of a successful trading life. It is just not everything.

[atac5922 10]

hi moreyummy,

 

still going around the site. i am more interested in forex trading and had recently started a Live trading acct. had been a rollercoaster ride so far.

 

u from toronto? was there nearly 30years ago while in university at buffalo,usa. had friend in the U of T. still remeber shopping at eaton centre, going to the amusement park etc etc...

 

of course it is not everything, but it is the KEY ingredient to long term success. no point making BIG winnings to lose it again without proper discipline in trading, whether stocks, futures, commodities or forex.

[MoreYummy 10]

cool. Eaton center is still there, but only the name itself. Everything else is changed.

 

Perhaps the the original eaton owners need some discipline in managing business as well.

[FulcrumTrader 10]

Hey, someone call Tiger Woods and ask him what he thinks about discipline!

[srag&birdie2 10]

I want to know how do you define discipline? What is it that I must do to get it?

[DugDug 10]

Discipline can be bought in a can down at the local store or off a website offering trading tools that will turn you into an instant millionaire..

 

Discipline defined to me - planing, developing a process (that involves thought, and testing), and applying the plan. On a regular recurring basis. (Practice, practice, practice the more you do the easier discipline becomes (be it good or bad habits))

 

General tips to get/improve discipline (of course these come with the caveat that you have to have some sort of discipline to do these)

 

1) Develop a trading plan, this should include strategy/edge/beliefs etc;

2) Plan your trades - know why you are doing them, what your entries, exits are etc;

3) Follow your plan. (tweak it, improve it, but stick to it if it works)

 

If you cant do steps 1-3 (in some form or another) then I suggest try another job. They are not hard, and the format and the detail is up to you. But if you cant really be bothered to even first think about and try and follow some sort of plan/methodology/style/system/idea then I feel that a successful long term trading career will evade you.

As you do 1-3, and the more you do 1-3 then the easier trading seems, the more relaxing it seems, and the less of a chore it seems. (Thats probably where intuition kicks in as its second nature and experience, easy as ABC - 123)

 

I am sure others will add to or detract from this, but that's my 2 cents.

[Head2k 10]

I want to know how do you define discipline? What is it that I must do to get it?

Discipline is sticking to your plan and strategy. In order to be able to define discipline, you must have a thoroughly defined strategy which allows for consistent application. Then, discipline means doing what you planned to do and not doing what you didn't plan for.

 

The better, the more precisely defined strategy you have, i.e. the better you know what you should do, the easier is to maintain discipline, i.e. the easier is actually doing it.

 

If you are not really sure what you are looking for in order to enter or exit a trade, then it is imposible to evaluate discipline. I thanked collegetrader for his posts because I think many aspiring traders seek problems in discipline or emotions while their problem lies in the fact that they don't know what exatly they are looking for, i.e. in their strategy and/or tactics. They seek problems in discipline while discipline can't be even defined in their case.

 

Another factor is confidence in what you are doing. Some people might take some mechanical strategy found on the internet, a strategy which is objectively defined, but they fail in sticking to it. Then the problem is not that these people wouldn't know what they should look for, but that they don't know why they should look for it. They don't understand the strategy and without understanding they have no trust in it.

It is much easier to maintain discipline if you know why you do what you do (and why you don't do what you don't). It is much easier to trust something which you developed and fine-tuned yourself, because then you know exactly all the whys. And of course, for confidence it is better if you base your strategy on some sound logic than on pure statisctics and/or back-test optimization. Because the logic is the piece you understand and trust, not the statistics. The statistics serve to test and confirm the logic. They are a tool to build your trust in the logic. But they can't become the confidence-founding logic themselves.

 

So my advice on how to "get" discipline is to develop a precisely defined strategy which allows for consistent, reproducible application in order to be able to even define the discipline.

[JEHs 10]

So my advice on how to "get" discipline is to develop a precisely defined strategy which allows for consistent, reproducible application in order to be able to even define the discipline.

 

Therein lies the problem for most. All this talk of discipline, but what is required is something to be disciplined at.

:bang head:

[Charlton 10]

Discipline means proper assessment of risk.

 

Risk is something you an evaluate and control.

 

You can control risk because:

 

(1) You can simply choose not to trade in any particular market situatioin

(2) You can choose to trade but adjust position size to take into account the likely risk

 

In a lottery for example there is huge risk and hugh rewards, so you adjust risk by betting/trading just £1 (1$).

 

As risk reduces e.g. safe stocks or government bonds your position size can increase.

 

(3) You can reduce risk by proper money management and stops. Stops should not be based on fixed percentages, but based upon what the market tells you. First the market will tell you if your assessment of market direction was correct. If price patterns, indicators, common sense tells you that you called the wrong market direction then get out asap. You can always re-enter the market if it turns and proves you right.

 

Market direction is the only thing that matters. You are either right or wrong.

 

Stops should look at what the market tells you, which is why volatility based stops (e.g. ATR) are the next best thing after readiing market direction. They tell you how far in the wrong direction you are prepared to go based upon how volatile, how irrational, how unpredictable the instrument that you are trading is in that particular market at that particular time.

 

Thie is where the true disicpline lies. It is in reading the market and taking the necessary steps to respond to the market without being arrogant enough to think that you can predict the market. All you can really do is assess risk and probability.

 

Charlton

[enochbenjamin 10]

everybody has a different take on discipline. to me its simple

 

• take your trade everytime you see the setup
  
• take your loss as soon as your wrong