Apr 08

What Does It Take To Be A Professional Trader?

Trading is not just about entering and exiting a trade and making or losing money in between. There is so much more to it that I found most traders are not considering especially since preparation and record keeping are not being taken seriously by most traders. I found that often traders contacted me believing that they had some sort of psychological problem but often after a few questions it already became apparent that their focus was purely on the trade itself, rarely any time is spend on thorough pre- and post trade analysis and evaluation. This lack of professional approach often results in emotional issues such as lack of confidence, fear of failure, anxiety and even as far as depression.

Here are some key points that every serious trader must consider:

1. Do you have a pre-trading session routine?

  • Physical preparation: are you well rested, well fed, had enough water
  • Mental preparation: ‘Getting Into The Zone’: calming the mind, focus exercise, mental rehearsal
  • Market preparation: fundamental research and analysis, technical / chart analysis, announcements, political events

2. How well do you know yourself? Do you know what your Ideal Trading State (ITS) is?

  • Ask yourself: What is the difference between the times when you make excellent trading decisions compared to when you made poor trading decisions?
  • How do you react emotionally and intellectually to making money? How do you react to losing money? Why?

3. How are you organizing your trading session?

  • Do you have a step by step in logical order written down trading plan (checklist style) on your trading desk?
  • Do you have strategies to sustain your ITS during the trading session?
  • How well did you time your entry?
  • How well did you time your exit?
  • How was your mental state during the trade, where you anxious or composed?

4. What is your after trading routine to complete the trading session?

  • How do you ascertain how well you have done in your trading?
  • Do you measure the quality of your trading results such as the relationship between profitable, unprofitable and trades let passed?
  • Do you measure the level of your focus, confidence, patience and discipline during the trade?
  • In a nutshell, do you perform an emotional and performance analysis (metrics) on a daily basis to ascertain what you have done well and what you can improve on?

 

Apr 07

Don’t Quit!

Don’t Quit!
When things go wrong, as they sometimes will,
When the road you’re trudging seems all uphill,
When funds are low and the debts are high,
And you want to smile but you have to sigh,
When care is pressing you down a bit,
Rest if you must, but don’t you quit.
Life is queer with its twists and turns,
As every one of us sometimes learns,
And many a failure turns about,
When he might have won if he’d stuck it out.
Don’t give up, though the pace seems slow –
You may succeed with another blow.
Often the goal is nearer than
It seems to a faint and faltering man;
Often the struggler has given up
When he might have captured the victor’s cup,
And he learned too late, when the night slipped down,
How close he was to the golden crown.
Success is failure turned inside out –
The silver tint of the clouds of doubt,
And you never can tell how close you are –
It may be near when it seems afar;
So stick to the fight when you’re hardest hit –
It’s when things seem worst that you mustn’t quit.
(I found that somewhere on the Internet and unfortunately can’t remember where from – Author Unknown)

Apr 07

What Makes A Great Trader?

Excerpt from http://news.yahoo.com/fx-traders-seek-coaching-battle-dominance-080909184.html By Nia Williams | Reuters – Sun, Sep 30, 2012

 …”Most traders and coaches agreed the most important attribute for making money in financial markets is self-confidence. Along with discipline and a clear process, it can help traders run profitable bets and cut quickly out of losses.

Without it traders may start second-guessing decisions, doubting their instincts and over-reaching for trades, said Graham Davidson, director of FX trading at National Australia Bank. He had a period of coaching around six months ago after slipping into bad habits that led to a 12- to 18-month “rough patch”.

“We talked about all kinds of stuff. It was mostly trading-centric but equally you have to be able to look inside yourself and figure out what motivates you,” Davidson said. “If you understand your subconscious and what the drivers of your behavior are you can become a better trader.”

Feb 26

At Peace with Money

People with money are not good or bad, they are just people with money.

People without money are not good or bad, they are just people without money.

You with lots of money is not good or bad, it is just you with lots of money.

Total acceptance of money can remove the fear of not having it and the guilt of having it.

If you believe people without money are good, you will have the guilt of having money.

If you believe people with lots of money are bad, you will have the fear of having money.

If you believe people without money are bad, you will have the fear of losing money.

If you believe people with lots of money are good, you will have the guilt of not having it.

Guilt and fear lower your self worth, hence the money you can make and have will create guilt and fear and lower your self worth!

Feb 25

Stop It!

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