Your Mama Doesn't Trade ... So Wise Up to Yourself!

[MP-TT 10]

Funny you mentioned Charlie Wright. I have another of his books called "Trading as a Business". I'll have to look at that one again.

 

My mistake. The book I was referring to is called 'Trading as a Business' and is the one that you have.

 

One of the biggest mistakes I made in golf was not getting a qualified instructor/mentor early on in my career. I tried to learn it all from books and watching the pros on TV.

 

I agree that a full-time, experienced coach can be of great benefit - especially if present early in anyone's development. Like you, I've tried learning many things from books etc. - with mixed results. So I accept that 'coaching' can be a great aid to success - but not just any coaching.

 

What I'm less convinced about is the efficacy of a coach who has never competed in the sport and then touts himself as a coach in that sport - providing only books and DVDs plus one hour a month talking over the phone.

 

Maybe that's adequate for someone who's happy with a small improvement in their golf handicap but I don't know of anyone who has reached the top of their sport with such a part-time coaching regime. Do you?

 

I see no reason why trading should be any different.

 

Is it really likely that such paltry, part-time coaching will enable someone to enter the 10% who consistently and successfuly compete against those who have better technology, are better informed and better capitalized? I contend that anyone entering that elite group did not do so because of THAT kind of part-time coaching and was probably very close to reaching the goal anyway. Instead of doing what they knew needed to be done, they sought someone to hold their hand instead.

 

On another note from your next post..

 

If losing this amount still hurts you have to go even lower until you find a value that does not hurt. For most, this will mean trading stocks or forex mini-lots and leaving futures for another day.

 

I don't think the amount is as relevant as you think. The problem here is actually the inability to accept sequential losses. That can often be the result of a lack of faith in the method being used. Lack of faith causes a trader to avoid taking trades after even a very short series of losses - as Steve46 mentioned.

 

e.g. If I tossed a coin and paid you $2x every time you called the result correctly but you had to pay me $1x when you got it wrong, how much 'hurt' would you experience on the losses?

Whatever your 'pain' threshold is ('x'), I bet you wouldn't feel anywhere near as much pain in the coin toss as you would in the market. The only difference is your faith in the methods' profitability over time.

 

In the coin toss, you'd never NOT take a trade - even after 10 consecutive losses.

Edited March 7, 2011 by MP-TT

[johnw 10]

Interesting thread.

 

Personally I cannot see the consistently successful Trader as being anything but the sum of the parts [psychological and technical]

But I do think that the posts are a revealing insight into the Posters.

 

Probably the best thread I have read.

 

Has any Trader here set their sights on $50K+ consistently per trading week.

 

It would be interesting to read your thoughts on your plan that has/ will get you there.

 

kind regards

[MP-TT 10]

Has any Trader here set their sights on $50K+ consistently per trading week. It would be interesting to read your thoughts on your plan that has/ will get you there.

 

It's a fair question but I'm not sure it's in the right thread.

 

However, in an attempt to make it so.........

 

Trying to impose any weekly target on the market is unrealistic and counter-productive. I believe that the goal of any trader should be to execute his plan flawlessly. While such perfection is impossible, it should be the overriding goal nonetheless.

 

To continue the golfing comparison. The best Pros on the Tour only concentrate on the next shot - not how much they will make per week. They seek consistency in performance and know that it is that which produces commensurate consistency in the financial rewards.

 

Placing financial goals too high in the trading process introduces a distraction from concentrating on what needs to be done and can lead to problems.

 

Then, the danger of seeking an unproven pseudoscience to make up for that simple lack of focus increases - and can itself, create yet another distraction.

[steve46 12]

As usual it seems people feel that they can simply ask for a trading plan that gets them to the moon and someone will step in and provide it.....you may want to ask sir or madam just how realistic is that?

 

On a more realistic note, as regards risk...I will post the following for Todds (I think that is who posted the most recent comment on that subject)

 

Generally speaking professionals manage risk by varying position size, timing of entry and exit and size of stop loss. If they are longer term participants they also have to know how to protect positions using options strategies. These are each subjects in themselves but I will give a short example for your consderation

 

If my account permits me to trade a max of 30 contracts, then initially I will go in with 15 (5 at a time) while I monitor the market for "confirmation"......to me "confirmation" means that the data I monitor tells me that I am right and the market is going my way....Initially I postion my stoploss about 2 points away. As soon as I get confirmation one way or the other I take action. If I am right I look to add another 15 ASAP, and then I go into "risk management mode". I do this because I want to be as big as possible when I am right.....In contrast, if I am uncertain or it look as though I am wrong, I will scale out (of my original 15 contracts) or wait for confirmation that I am wrong (that usually means a stop out and a 2 pt loss).

 

* "risk management mode" means that my job is to stay in the market as long I see it is moving my way....alternatively if I see the market stalling or not going my way my job is to take profit and reduce my exposure to "systematic risk" (unanticipated bad news or perhaps a "flash crash" event)...

 

As you can see, professional conduct is much different than retail, where the trader (usually) has a very limited account size, and therefore has fewer options with regard to entry, profit/loss and exit.

 

Finally I want to stress that there is a lot of nuance to this stuff..don't think that you can read about it in a book (or here in a post) and go get a second mortgage on your house to fund an account......hahahaha....(I've actually seen people suggest this in past)....it probably wont work out well in the end. In my opinion the only way to do this is to see it done in front of you and ask questions...and that is probably the biggest roadblock for retail traders trying to transition into professional status.

 

Hope this helps a little bit

[steve46 12]

I guess I will take a moment to post one additional comment about risk

 

Most people (including the so called experts) don't seem to understand what its all about...they describe the subject in terms of "taking a bet", where you either win or lose and thats it, over and done...the problem is that in real time, the trader experiences risk in a much different way....Its not a matter of placing a bet long or short and winning or losing, boom your done....no way....instead the trader gets filled and waits......and waits.....and waits, while the market ticks up......and ticks down...and ticks up....(are you getting the message)...so the real IMPACT of risk is the tension that exposure to risk creates and how the trader reacts to that exposure while in the trade...

 

In other words, there are several elements to risk that you have to understand in order to control your emotions. One is that when you are "at risk" (your position is "on"), then you have to be able to manage the tension associated with not knowing whether you are going to win or lose

 

The second issue is that you don't know how long it will take to determine whether you are going to win or lose (how long should you wait....should you let it run, or get out....should you let it hit your stop, or get out) this is how the retail trader experiences that tension....in terms of "duration".

 

and finally unlike the "bet scenario" that most of you quote....you never really know what the money outcome is going to be.....clearly you THINK you know, but when you are in the trade....you have no idea of whether that market is going to spike up or down, and how much....ultimately you don't know whether you will win or lose a particular amount of money....and THAT tension is what causes the average trader to cave in and take a tick or two.....(thats why we call retail traders "weak hands")...

 

So in summary, there are several elements to risk....and you have to understand and figure a way to handle the emotional stress associated with each one....or you are always going to getting your ass whipped when you try to trade....I may have more to say about it later, but for now thats my thought on the subject.

 

Good luck

Edited March 8, 2011 by steve46

[johnw 10]

Interesting thread.

 

Personally I cannot see the consistently successful Trader as being anything but the sum of the parts [psychological and technical]

But I do think that the posts are a revealing insight into the Posters.

 

Probably the best thread I have read.

 

Has any Trader here set their sights on $50K+ consistently per trading week.

 

It would be interesting to read your thoughts on your plan that has/ will get you there.

 

kind regards

 

 

 

Any other Traders care to have a go at this question.

 

kind regards

[todds 10]

I agree that a full-time, experienced coach can be of great benefit - especially if present early in anyone's development. Like you, I've tried learning many things from books etc. - with mixed results. So I accept that 'coaching' can be a great aid to success - but not just any coaching.

 

What I'm less convinced about is the efficacy of a coach who has never competed in the sport and then touts himself as a coach in that sport - providing only books and DVDs plus one hour a month talking over the phone.

 

 

The full time, experienced coach is what I was talking about. Someone you knew was successful and could interact with face to face. Most don't have that opportunity so the next best thing might be a reputable service on the internet (key word, reputable). I don't think it is unrealistic to expect that one could find a service that would help them flatten their learning curve. Are there cranks, yes. Are there good ones, yes. One has to use their judgment.

 

As an aside, many a champion golfer have had swing instructors that never came close to being champions themselves. However, most work quite hard on their own games and bring that experience with them. Whether the same can be said in trading I could only guess.

 

I don't think the amount is as relevant as you think. The problem here is actually the inability to accept sequential losses. That can often be the result of a lack of faith in the method being used. Lack of faith causes a trader to avoid taking trades after even a very short series of losses - as Steve46 mentioned.

 

e.g. If I tossed a coin and paid you $2x every time you called the result correctly but you had to pay me $1x when you got it wrong, how much 'hurt' would you experience on the losses?

Whatever your 'pain' threshold is ('x'), I bet you wouldn't feel anywhere near as much pain in the coin toss as you would in the market. The only difference is your faith in the methods' profitability over time.

 

In the coin toss, you'd never NOT take a trade - even after 10 consecutive losses.

 

Unless the 10 consecutive losses wipe out your account.

 

The more painful the loss the more faith one must have in their method. The more faith one has in their method the more risk one might be willing to take. We could go round and round. One could trade 6E at $12.50/tick or EUR/USD at $1 a pip. Either way, unless one can find a size that easily allows them to take the next trade, even after a series of losses, they will have a hard time trading their method the way it should be traded. When people say they are having a hard time pulling the trigger live, even though they know their edge is good, I venture that this is the reason. Find a way to reduce size until it becomes insignificant, then slowly ramp it up.

 

As usual it seems people feel that they can simply ask for a trading plan that gets them to the moon and someone will step in and provide it.....you may want to ask sir or madam just how realistic is that?

 

Steve46, if you are referring to my request for successful traders to share their "simple" methods so we can all move on, it was partly said in jest and partly as a challenge to the casual statements I hear to the effect that the edge is the easy part and most of the work is psychological. If it’s easy lets get it over with. No one is looking for a handout here, but if you offered…

 

On a more realistic note, as regards risk...I will post the following for Todds (I think that is who posted the most recent comment on that subject)

 

Generally speaking professionals manage risk by varying position size, timing of entry and exit and size of stop loss. If they are longer term participants they also have to know how to protect positions using options strategies. These are each subjects in themselves but I will give a short example for your consderation

 

If my account permits me to trade a max of 30 contracts, then initially I will go in with 15 (5 at a time) while I monitor the market for "confirmation"......t o me "confirmation" means that the data I monitor tells me that I am right and the market is going my way....Initially I postion my stoploss about 2 points away. As soon as I get confirmation one way or the other I take action. If I am right I look to add another 15 ASAP, and then I go into "risk management mode". I do this because I want to be as big as possible when I am right.....In contrast, if I am uncertain or it look as though I am wrong, I will scale out (of my original 15 contracts) or wait for confirmation that I am wrong (that usually means a stop out and a 2 pt loss).

 

* "risk management mode" means that my job is to stay in the market as long I see it is moving my way....alternatively if I see the market stalling or not going my way my job is to take profit and reduce my exposure to "systematic risk" (unanticipated bad news or perhaps a "flash crash" event)...

 

As you can see, professional conduct is much different than retail, where the trader (usually) has a very limited account size, and therefore has fewer options with regard to entry, profit/loss and exit.

 

"Generally speaking professionals manage risk by varying position size, timing of entry and exit and size of stop loss." I couldn’t agree more. However, I would disagree that being a professional has to do with account size. I assume you are trading ES? So your max loss on a trade would be $1500? I assume $1500 is but a small fraction of your account? How is this different than someone with a smaller account who manages their trades the same way and risks the same % per trade by using other available instruments that allow them to do so? I am sure that you could come up with a position size that would cause even you to choke. That was my point. Figure out a size where you don't choke, no matter what percentage it represents of your account.

[steve46 12]

Todds

 

Your assumptions are incorrect on all fronts. First my initial comment was made in response to another post not yours.

 

My stoploss and placement are provisional and depend on the individual market. As an institutional trader I maintained a presence in the Bond and Euro. For my personal account I often trade the S&P and the DAX futures. I chose an example account for discussion purposes only and to try to make the example accessible to retail traders. In reality, institutional traders often mobilize tens of millions of dollars of account value (more in the bond markets). Talking about this in terms that make sense to a retail trader is not productive, so I used a different example. One hopes that the take away for retail traders is that to manage risk effectively you need specific skills (and now that I am thinking about it again) a specific attitude toward risk that retail traders might characterize as too casual. In fact those of us who do this well always prioritize and manage risk AHEAD OF profit...

 

Finally in terms of your point about % of account, the idea that you can scale down and still operate effectively is simply wrong....for futures markets, unless you have a minimum of $20,000 in your account your odds of success are low. Simply put, you have to be able to withstand the inevitable drawdown and for most retail traders that means at minimum of 25% (if you take the trades)....My advise to retail traders is if you don't have an adequately capitalized account, hang back until you do....and use that time to improve your skills.

 

With respect to choosing an alternative to S&P futures, I think you could try SPY instead. Trading small size of SPY might work.

 

Hope that makes things clearer

Edited March 8, 2011 by steve46

[MP-TT 10]

[

Unless the 10 consecutive losses wipe out your account.

Yes, no doubt. That would be a game ender but I took it as a given that we were employing a legitimate trade size for each coin toss. e.g. no more than 2% of capital.

That's why I didn't say that size was 'irrelevant' but just 'not as relevant' as you think.

 

But your answer does raise the following questions:

 

Is it the wiping out of the account that typically prevents the trader from taking just 3 or 4 consecutive losses in the market if he's only risking 2% max?

If not, is it because of some deep-rooted, psychological issue?

If so, then why is he not affected by this issue on the 3rd or 4th losing coin toss with the same level of paralysing fear? If it isn't due to his confidence in the long-term profitability of the coin-toss, then what is it?

How many traders have you ever heard of who blew their accounts because they took small, consecutive losses? I don't know of any but I do know some who emptied their accounts on just one trade.

 

As an aside, many a champion golfer have had swing instructors that never came close to being champions themselves. However, most work quite hard on their own games and bring that experience with them. Whether the same can be said in trading I could only guess..

 

I completely agree that the golf instructor doesn't have to be a Champion himself. That qualification has never been a pre-requisite for me. No, my concern is with the golf instructor who:

 

1. Has never played golf and therefore, has no experience to bring with them.

2. Has no intention of playing golf.

3. Has no records of how many people have taken his golf course.

4. Has no records of how many have failed to improve as a result of his coaching and has no desire to find out.

 

Do you know of any champion golfers who have had such an instructor?

 

On the subject of risk:

 

Perhaps I misunderstood Steve46's post but I believe that there is a big difference between:

 

1. Defining what 'risk' is as it relates to trading.

and

2. The physical and mental effects upon the trader of taking that risk.

and

3. The choice of whether to hedge that risk or not.

 

They are very different animals and should not be confused.

 

Regarding 1: I would defer to Mark Douglas' Chapter on Risk in 'Trading in The Zone'. It's repetitive and hard work but probably the best dissertation on 'risk', as it applies to trading, that I've ever read - although I didn't realize it until the 3rd attempt to read it .

 

Regarding 2: How a person experiences 'risk' is not the same thing as 'risk' itself. Risk is a constant and, for the same trade, will be identical for everyone.

However, traders' reactions to that risk are variable. That's what causes so many different results because some traders increase the original risk rather than accept it.

 

A trader will know when he has fully accepted 'risk' in trading when there are no adverse physical and/or mental effects. A state of almost total disinterest in the outcome of a trade is the real Holy Grail of trading IMO.

If this is not the case, then survival is still possible but it'll be an uncomfortable survival because he still hasn't fully accepted risk. Many confuse just taking a risk as proof of accepting and understanding it fully.

 

Regarding 3: It is not necessary for a trader to hedge and/or scale trades. Where hedging becomes unavoidable as a strategy is when very large positions or portfolios are held which may be difficult to liquidate in a hurry. Also, if you must have unmonitored positions open for days, then it's prudent to employ some insurance against Black Swan events beyond just Stops (particularly in thinly traded markets). Those tactics have nothing to do with 'risk' itself but are choices a trader makes to mitigate that risk as part of his method.

 

I'm not saying it is either right or wrong to hedge or not hedge. Nor is it necessarily more or less profitable to simply trade full position Outrights and reverse fully when a switch point has been reached rather than scale in/out. Whichever makes a trader more comfortable - go with that.

 

Personally, I prefer to say 'go long' or 'go short' but 'bets' is as good a term as any to describe Outrights - because, in fact, that's exactly what they are.

That doesn't make them any less legitimate as a trading method and I don't believe that calling them 'bets' or choosing to trade that way has any bearing on whether a trader understands 'risk' or not.

 

Understanding risk is more about elimination of emotional discomfort and fear by fully accepting and limiting it - not the trading method or nomenclature used.

Edited March 8, 2011 by MP-TT

[steve46 12]

I am sure its just my clumsy attempt to comment that causes misunderstanding

 

Emotional reaction to risk depends on the skill and experience of the participants

 

If you want to learn to accept risk, simply committ to taking a significant sample of trades (ALL OF THEM within the sample)...in my opinion this can be as few as 20 or 30 trades although realistically more would be better. You then process your result and take a unemotional view of what your result is...This is part of a process that I was taught long ago and that some call "desensitization". It also teaches you to keep good records and if you have a good advisor, how to interpret your result accurately and what to do if you have to "adjust" your program. Very few retail traders do this and that is probably why they have a strong emotional reaction to the result of individual trades...

 

Finally if you ever get a chance to talk to a skilled professional...ask what their attitude was toward their last losing day....Generally speaking they will shrug and say "its not my first loser, and it won't be my last"...and I would hope that if you asked about their last winning day, they would say something along the same lines about winning. For me and I think for most of my colleagues, we are indifferent to any single trade, any single day, or even week for that matter...naturally as you move to longer time frames you are likely to see a little more reaction, but even then we all know that sooner or later we are going to have to deal with loss, and the way you deal with it is by putting it behind you and coming back to work just like the everyone else.

Edited March 8, 2011 by steve46

[PiptopiaX 10]

Interesting thread.

 

Personally I cannot see the consistently successful Trader as being anything but the sum of the parts [psychological and technical]

But I do think that the posts are a revealing insight into the Posters.

 

Probably the best thread I have read.

 

Has any Trader here set their sights on $50K+ consistently per trading week.

 

It would be interesting to read your thoughts on your plan that has/ will get you there.

 

kind regards

 

 

John,

Do you really think any trader pulling down $50K a week would be posting here on the forum?

[johnw 10]

John,

Do you really think any trader pulling down $50K a week would be posting here on the forum?

 

 

Good work Pip, you are the first person to grasp the intent of the question.

 

But in answer to the question, the answer is relatively simple.

 

Firstly, assuming all week days are equal, and they are not, 50K represents 10K per day

after brokerage, which is not excessive at this level.

 

10K is 800 tics.

Now, let us take Steve's figure of 30 lots.

Firstly is it realistic for a 30 lot ES trade ... absolutely, ES will carry a great deal more than 30 lots.

 

30 lots needs 27 tics per day to meet the total of 800 total tics.

 

Is this realistic ... of course it is.... you just need a structure to do it with.

But ...What happens when we have "no trend" days

 

Frankly the shape of the day does not matter... you just trade the day as it comes.

 

Imagine the price is a piece of string of a certain length.

Drag it along the desk and it straightens into a trend day.

Push on the piece of string and it folds in upon itself like a "no trend day"

 

Trading is a job for clear thinking people with unencumbered minds.

There is no place for delusive or cognitive dissonance thinking.

 

Think big and then take baby steps towards your goals.

 

Do not be drawn into thinking " I take what the market offers.

Do not think that confidence only comes from success ... how do you possibly think that you are every going to get started holding this belief.

 

There is no split between technical and physiological... we are talking of you in the singular, not as two people.

You are a seamless well oiled trading machine that attacks the market with great cunning and stealth whilst always protecting your capital.

 

Remember to always break things down into digestible bits before reassembling them.

Build good daily habits if you don't care for the word "discipline" and create a trading structure within which you can trade.

 

They say that if you want to see God laugh then just make a plan.

 

I believe there is truth in this saying.

Trading requires both fluidity and rigidity and a plan tends to be rigid only.

Therefore think towards creating a structure within which you trade.

 

I believe the daily mood of the ES has far more to do with the outcome, than anything that a rigid TA plan can every be expected to yield ... but each has it's place and it is up to you the Trader, to assign weighting to your beliefs.

 

For example, I use a relatively crude alarm to alert me to a possible setup.

The only purpose of the alarm is to return me to the screen and within a few seconds

I can determine whether it is a "no go" or I can play out my strategy.

I never sit continuously in front of the screen ... that is "deer in the headlights" thinking,

and we all know the outcome of that scenario.

 

Bear in mind that price move diagonally across the screen and your traps are set at horizontal lines.

This applies equally to entries and exits.

 

If you can feel any of this post coursing through your veins.

If you can actually feel the excitement of the challenge that trading offers,as a physical change to your body

then you are in this game with a good chance.

 

If any of this rolls around the front end of your brain without stirring any physical reaction whatsoever, then find another job.

Edited March 9, 2011 by johnw

[zdo 20]

...also, for many, at a different level creating the ‘body’, the identity, to actually accommodate taking avg $xx per day is a harder, lonelier job than ‘learning’ how to do it technically...

[Rande Howell 10]

...also, for many, at a different level creating the ‘body’, the identity, to actually accommodate taking avg $xx per day is a harder, lonelier job than ‘learning’ how to do it technically...

 

I would also add: For what purpose does the trader act? Defining money as the source of purpose is a slippery slope long term. My hope, at this level, there is more to the meaning and possibility of money. Templeton and Gates finally began to see money as a tool, rather than the source of power and identity. In Bill Gates situatution, I am thanful for Melinda.

 

Rande Howell

[johnw 10]

I would also add: For what purpose does the trader act? Defining money as the source of purpose is a slippery slope long term. My hope, at this level, there is more to the meaning and possibility of money. Templeton and Gates finally began to see money as a tool, rather than the source of power and identity. In Bill Gates situatution, I am thanful for Melinda.

 

Rande Howell

 

 

Money and trading do not mix in my book.

 

Certainly, over the weekend you could count your spoils if that sort of thing is of interest to you, but if you have more than you need and you know that there will be even more next week, the whole concept of money changes shape gradually as other more interesting things fill your life.

 

Trading is a game in my mind, or at least that is how I configure it, because it suits me.

 

I cannot accept it as a business, because my experience of business is based upon persuading other people to follow my structure and the level of interactivity is always very high. Profits are made largely through the efforts of others in business

 

In trading, I find a purity and a great ongoing challenge.

kind regards

Edited March 9, 2011 by johnw

[TheNegotiator 13]

I think a really important factor to keep in mind, is all of this means nothing without thorough planning for the day/week/month regarding what markets are doing, effective and detailed research on the market you are trading and a trading strategy which is consistently likely to be profitable. Look at traders at banks and hedge funds. How many hours do they put in? I'm not saying all of them 'make it' as there are certainly other aspects. But if you are not making money, don't assume it's because of trading psychology. Do yourself a favour, put the hours in, do the work and give yourself a chance of being confident. If you do this and still have issues, maybe then seek some help with the psychological side of trading. Just my opinion.

[SIUYA 11]

Money and trading do not mix in my book.

 

Certainly, over the weekend you could count your spoils if that sort of thing is of interest to you, but if you have more than you need and you know that there will be even more next week, the whole concept of money changes shape gradually as other more interesting things fill your life.

 

Trading is a game in my mind, or at least that is how I configure it, because it suits me.

 

I cannot accept it as a business, because my experience of business is based upon persuading other people to follow my structure and the level of interactivity is always very high. Profits are made largely through the efforts of others in business

 

In trading, I find a purity and a great ongoing challenge.

kind regards

 

While I get your point, you may as well stick to SIM

 

Seriously though when people talk of it as a business, it should be thought of as such in that those who trade for a living...not for fun, not for purity, not for a few extra dollars, generally treat it as a business. They understand costs, business plans etc.

Trading should fit your definition of a business perfectly - Profits are made largely through the efforts of others in business - as futures markets are a zero sum game;)

[johnw 10]

While I get your point, you may as well stick to SIM

 

Seriously though when people talk of it as a business, it should be thought of as such in that those who trade for a living...not for fun, not for purity, not for a few extra dollars, generally treat it as a business. They understand costs, business plans etc.

Trading should fit your definition of a business perfectly - Profits are made largely through the efforts of others in business - as futures markets are a zero sum game;)

 

Interesting response.

 

First you get my point: and then having said that, you move on to disagree.

 

Does your concept of "The Game" conjure thoughts of fun, stimulation, something that is definitely "not work" ......that is how you appear in your post.

 

The Game" to me requires a highly professional approach to a challenge, but requires no staff and none of the usual organisation that owning and operating a business demands.

 

To give you an incredibly simple example .... take a public holiday ... the Business Owner is paying holiday pay, insurances, rents, in fact all his fixed costs are flowing out of the coffers . yes I know that you may call this the cost of doing business and indeed you are correct.

 

The Day Trader meanwhile is relaxing for the day ... nothing earned and nothing spent.

 

That is how I see "The Game"

 

In fact just to jolt your senses even further, I see life as "The Game"

 

Please bear in mind that society does not raise you to see life in this context.

 

Rather, Society wants you "attached" in several directions simultaneously, and there you stay unless to can unravel the puzzle of your life for yourself.

 

"The Game" is to be taken seriously if you are going to be a Player

[SIUYA 11]

in response..... and while this is all how each defines things....

I see life as fun.....its meant to be about enjoyment and its meant to be as easy as possible given any circumstances.

I see trading as a business, in that you have to have a focus, a plan, you have to approach it as such. etc; etc.

So I guess we do see it similarly.....its just as you point out many businesses require pay slips etc. while day trading requires less of this......and yet I would guess that many many day traders fail because they dont treat it seriously enough.

As I do more than just day trading, and run more a portfolio among other things I have other issues....none involving payslips (yet I still have problems with my accountants, brokers, clearers, data providers and such)

They should rename legal and compliance departments the business blocker department! Now wheres my mama when I need her?

[MightyMouse 12]

Interesting response.

 

First you get my point: and then having said that, you move on to disagree.

 

Does your concept of "The Game" conjure thoughts of fun, stimulation, something that is definitely "not work" ......that is how you appear in your post.

 

The Game" to me requires a highly professional approach to a challenge, but requires no staff and none of the usual organisation that owning and operating a business demands.

 

To give you an incredibly simple example .... take a public holiday ... the Business Owner is paying holiday pay, insurances, rents, in fact all his fixed costs are flowing out of the coffers . yes I know that you may call this the cost of doing business and indeed you are correct.

 

The Day Trader meanwhile is relaxing for the day ... nothing earned and nothing spent.

 

That is how I see "The Game"

 

In fact just to jolt your senses even further, I see life as "The Game"

 

Please bear in mind that society does not raise you to see life in this context.

 

Rather, Society wants you "attached" in several directions simultaneously, and there you stay unless to can unravel the puzzle of your life for yourself.

 

"The Game" is to be taken seriously if you are going to be a Player

 

It seems like a doobie may have been in the vicinity when the "life puzzle" was being unraveled and de-attached. Very enlightening.

[johnw 10]

It seems like a doobie may have been in the vicinity when the "life puzzle" was being unraveled and de-attached. Very enlightening.

 

 

If a doobie is what I think it is, I tried it once years ago and didn't care for it.

I much prefer a couple of drinks.

 

I have watched people with a bent for pharmaceutical products and doobies

and while it may suit them, it doesn't suit me... each to their own

 

If you ever travel in the Andes, the locals will give you coca leaves to chew, to help combat the altitude ... it really works.

Coca tea after dinner settles your stomach and thereby allows you a good nights sleep.

It prevents tooth decay and has many other natural properties ....nothing about coca is additive ... probably habit forming, but then good habits are essential to good fun filled living.

 

All this is denied to the "1st" world population, but you are permitted prescription drugs

 

If you looking up the foods and medicines of Incas and Mayans you will come across several food and extract groups that will have you jumping out of your skin if you can access them in their natural form.

 

Try looking up Quinoa and Maca for a start .... take them for a test drive, you will not be disappointed.

Try reading the history of these two rather than just the usual rubbish posted on the net.

Remember, if you are a big drinker or you are a substance user, you are wasting your time and money trying anything new and beneficial.

[MightyMouse 12]

If a doobie is what I think it is, I tried it once years ago and didn't care for it.

I much prefer a couple of drinks.

 

I have watched people with a bent for pharmaceutical products and doobies

and while it may suit them, it doesn't suit me... each to their own

 

If you ever travel in the Andes, the locals will give you coca leaves to chew, to help combat the altitude ... it really works.

Coca tea after dinner settles your stomach and thereby allows you a good nights sleep.

It prevents tooth decay and has many other natural properties ....nothing about coca is additive ... probably habit forming, but then good habits are essential to good fun filled living.

 

All this is denied to the "1st" world population, but you are permitted prescription drugs

 

If you looking up the foods and medicines of Incas and Mayans you will come across several food and extract groups that will have you jumping out of your skin if you can access them in their natural form.

 

Try looking up Quinoa and Maca for a start .... take them for a test drive, you will not be disappointed.

Try reading the history of these two rather than just the usual rubbish posted on the net.

Remember, if you are a big drinker or you are a substance user, you are wasting your time and money trying anything new and beneficial.

 

The hardest I go is coffee. I prefer my thoughts to be unhindered 100% of the time. Not just with trading. All the time. It does seem to me that a lot of people cannot have fun without drinking which is sad in a way and they are uncomfortable with me being there when I am not drinking.

[todds 10]

[

Yes, no doubt. That would be a game ender but I took it as a given that we were employing a legitimate trade size for each coin toss. e.g. no more than 2% of capital.

That's why I didn't say that size was 'irrelevant' but just 'not as relevant' as you think.

 

But your answer does raise the following questions:

 

Is it the wiping out of the account that typically prevents the trader from taking just 3 or 4 consecutive losses in the market if he's only risking 2% max?

If not, is it because of some deep-rooted, psychological issue?

If so, then why is he not affected by this issue on the 3rd or 4th losing coin toss with the same level of paralysing fear? If it isn't due to his confidence in the long-term profitability of the coin-toss, then what is it?

 

I assume we are talking here about a trader who has never tasted lasting success. For this trader uncertainty abounds, especially if his method is predominantly discretionary. "Does my system still work? Have market conditions invalidated it? Have circumstances in my life altered my judgment? Did I simply get lucky during my testing period?" If 2% represents a dollar figure that the trader finds painful, then losing 3 or 4 in a row will be difficult to handle no matter how much he intellectualizes the expectations of his method.

 

I would agree that if a trader were given the opportunity to trade something as certain and unchanging as a coin toss with a 2/1 payout ratio for winners to losers and still couldn't pull the trigger then they might have some serious psychological issues. That begs the following question:

 

What if the person tossing the coin was a stranger and the trader never had a chance to examine the coin. How many 2% losers in a row would the trader be able to endure before he began to question the "system"?

 

[

 

How many traders have you ever heard of who blew their accounts because they took small, consecutive losses? I don't know of any but I do know some who emptied their accounts on just one trade.

 

I don't know enough traders to answer your question but I bet there are a lot of traders who did serious damage to their accounts, and thus felt a lot of pain, through a hundred tiny cuts trading flawed methods.

 

 

[

I completely agree that the golf instructor doesn't have to be a Champion himself. That qualification has never been a pre-requisite for me. No, my concern is with the golf instructor who:

 

1. Has never played golf and therefore, has no experience to bring with them.

2. Has no intention of playing golf.

3. Has no records of how many people have taken his golf course.

4. Has no records of how many have failed to improve as a result of his coaching and has no desire to find out.

 

Do you know of any champion golfers who have had such an instructor?

 

If a student who was serious about getting good chose an instructor with the above qualifications I would think there was more wrong with the student than the instructor.

[kaiser 10]

Dear Rande, thank you for your words!! I am actually a big fan of what you say - various self-improvement methods starting from past-life regressions to using vibrational essences. That has helped me a lot but not enough to be a good trader. After some period of trading I found I was pre-programmed for loosing money. I would be happy to know what you recommend to overcome these psychological obstacles.

 

I know of people who offer hypnotic sessions, Neuro Lingvistic Programming etc. What is your advice for self-development?

 

Thank you again, Pavel, Czech Republic.

[Rande Howell 10]

Dear Rande, thank you for your words!! I am actually a big fan of what you say - various self-improvement methods starting from past-life regressions to using vibrational essences. That has helped me a lot but not enough to be a good trader. After some period of trading I found I was pre-programmed for loosing money. I would be happy to know what you recommend to overcome these psychological obstacles.

 

I know of people who offer hypnotic sessions, Neuro Lingvistic Programming etc. What is your advice for self-development?

 

Thank you again, Pavel, Czech Republic.

 

Our brain's job is to organizes us to survive in a particular environments. Out of this organization come our beliefs from which we see and interact with the world. You can call this "pre-programming". I personally see it as one potential organization of the self that has become your historical perceptual map. Loser's Mind in this way of understanding is only a hardwired way of being in the world -- it is not you. It is a mindset that, at one time, was a successful solution to circumstance. The problem is that it operates out side of our awareness and continues far beyond its usefulness. You find this out in trading especially.

 

Using one-time tricks to change deeply embedded neural circuitry, to me, is a fool's way of attempting change. What you get is catharsis and feel new for a while, then the old wiring of belief pattern re-establishes itself. In much the same way that 95% of dieters regain their weight, so it is with trying to change external circumstance without changing internal belief structure. Real emotional labor is required.

 

This is what I call confronting your psychological demons. It can be done, and requires a mixture of courage, compassion, and healthy shame to reorganize the belief pattern in the brain. I teach this, but it is not a quick fix solution like is promised in some of the processes you suggested. If you're really interested, I'd suggest you attend one of my free webinars or read my book to see how this is done. I'm only saying this because you asked. If you're looking for magic though, don't look here.

 

Rande Howell