My three trading rules

[tech/a]

Cartman.

These three rules can apply to anyone.

 

[Cartman]

Cartman.

These three rules can apply to anyone.

Tech, u may have misinterpreted the meaning of my post -----

not discounting 'the rules' at all -----trying to get a bit closer to the bone than that ------

just dont want uninitiated newbies thinking they can go out and wreak havoc on the markets cause they r having a good day -----

they/all of us need to prove that their good days are the 'norm' b4 they start compounding their way to financial freedom ----- slash Oblivion

 

[It's Snake Pliskin]

As simple as it seeems your 3 keys are a guarentee for success in any business.

(1) Dont be undercapitalised.Trade within your limits and stay in the game!
Knowing that if you have consistent profits and low overheads you'll be nett profitable.
(2) Increase your capital base.(Then go to (1))
(3) When you get it right---compound---do it again and again.
Then go to (2)

Most turn the most simple into the most complex.
You have proven that just isnt necessary.

The real message here is in the simplicity.
Brilliant.

Not to mention its context and situational relevance for the individual.

 

[johenmo]

I'm a newb like inenigma, but I have woken to to the fact that adequate capitalisation is needed. People make it through with "small" capital amounts but simple maths on brokerage shows you need to make x% just to cover these costs.

Just a few days ago something clicked and I can see how complicated I have been making the building of my plans (something tech/a commented on a few months back - it's now sunk in). I realise I need a mechanical system, rather than discretionary. And the impatient urge to enter the market again has gone.

So now I will start from scratch but it will be quicker! Thanks for all the food for thought over the last 6 months!

So I would list, in no particular order:
1) Correct frame of mind/mindset/psychology (call it what you like = think right)
2) exit strategy
3) money management - such a broad "rule"!

 

[Trembling Hand]

1) Correct frame of mind/mindset/psychology (call it what you like = think right)

This means nothing if you are trying to turn $5000 into $500,000 and have no skills.

Its a scam the mindset crap. Forget that and replace it with skill development and review.

 

[It's Snake Pliskin]

So I would list, in no particular order:
1) Correct frame of mind/mindset/psychology (call it what you like = think right)
2) exit strategy
3) money management - such a broad "rule"!

What about entries?

 

[MS+Tradesim]

This means nothing if you are trying to turn $5000 into $500,000 and have no skills.

Its a scam the mindset crap. Forget that and replace it with skill development and review.

Have to disagree TH. Having skills won't help if you can't keep your head in the right place. And having right mindset won't help if you don't know what you're doing.

 

[aarbee]

Its a scam the mindset crap. Forget that and replace it with skill development and review.

I would think that skill development itself is a subset of mindset and not the other way around.

One has to have a proper mindset to even begin the journey towards skill(s) acquisition. With a coachable mindset a person can begin the journey towards skill development and being conscious of the need for personal development can undertake the skill development in an even more efficient way.

Successful people have acquired that particular way of thinking or mindset either by happenstance (or unconscious effort) or consciously which johenmo is indicating. I suspect you belong to the former category. Goodonya.

For the rest of the folks, understanding their own current mindset and it's limitations is a great step towards doing something to improve it.

Cheers

 

[Trembling Hand]

BS.

I have been been involved in performance activities of one sort or anther to make my living for more than 20 years. From my observations the mindset rubbish comes from observing the end product of skill development. That people of very high ability are completely in control of their emotions - tiger Wood being the prime example here. But that's the end product. The result of practise and the confidence of ones skills and abilities to achieve something.

I could bang on about this for ever but read this

http://traderfeed.blogspot.com/2008/12/can-i-trade-for-living-quest-for.html

Its a good mind opener.

 

[MS+Tradesim]

I could bang on about this for ever but read this

http://traderfeed.blogspot.com/2008/12/can-i-trade-for-living-quest-for.html

Its a good mind opener.

I read it. It's 100% aligned with my comment. From the link:

Mindset is critical in sustaining motivation, interest, and focus during the learning curve, and mindset is crucial in the consistent application of one's skills. The wrong frame of mind and emotional/cognitive/physical state can disrupt the best of skills, but the best of mental outlooks cannot substitute for developed skills. No positive mindframe and "method that suited me" can provide competencies--in any performance field.

 

[James Austin]

BS.

I have been been involved in performance activities of one sort or anther to make my living for more than 20 years. From my observations the mindset rubbish comes from observing the end product of skill development. That people of very high ability are completely in control of their emotions - tiger Wood being the prime example here. But that's the end product. The result of practise and the confidence of ones skills and abilities to achieve something.

I could bang on about this for ever but read this

http://traderfeed.blogspot.com/2008/12/can-i-trade-for-living-quest-for.html

Its a good mind opener.

TH,

did i read somewhere recently that you wrote you stopped trading for a few weeks a while back due to not being in the right frame of mind?

In this instance, despite your skill level, you recognised that your frame of mind would influence/offset your skill set.

James

 

[tigerboi]

hey TH --- (luv ya work )

this kind of method is used by 'GOOD" punters in the racing game as well --- (not that im saying punting is anything like day-trading lol --- well actually thats exactly what im saying

when a professional punter is 'in the zone' ----- the instinct becomes so focused that the brain seems to decipher the information on a higher level --

and that is when the 'punter' SHOULD be aggressive ---

i think the biggest mistake many of us make as punters/traders is to try and play 'catch up' on our bad days ---- when we should be walking away --- and going in hard when the Karma gods are smiling -----

I used to be a professional punter back in the early 90's so for me its all about discipline...as for 1 or 2% of capital that doesnt do it for me...

if you've got absolute discipline & confidence in your abilities then 75-100% of your coin on the table is no problem...

its all about discipline...tb

 

[Trembling Hand]

Mindset is critical in sustaining motivation, interest, and focus during the learning curve, and mindset is crucial in the consistent application of one's skills. The wrong frame of mind and emotional/cognitive/physical state can disrupt the best of skills, but the best of mental outlooks cannot substitute for developed skills. No positive mindframe and "method that suited me" can provide competencies--in any performance field.

The red bit is the important bit. Yes if your messed up you may trade **** But If you have no skills no matter how hard you try and have the right "mindset" you will lose.

Answer me this,

You & your partner are captured by Somali pirates. They give you the opportunity to go free is you can shoot an apple off your partners head with a pistol from 10 meters. A Jeannie turns up and grants you 1 of two things. The mindset to perform the task calmly OR the skills to shoot an apple from 10 meters,

Which one will you take? Shootings skills or a calm approach to blowing your partners head off???

 

[jersey10]

Which one will you take? Shootings skills or a calm approach to blowing your partners head off???

LOL

 

[MS+Tradesim]

Rephrased: I think you're looking for disagreement where none exists. I am in agreement with the article. Both are important. To push for either/or creates a false dichotomy.

Again: Having skills won't help if you can't keep your head in the right place. And having right mindset won't help if you don't know what you're doing.

 

[Trembling Hand]

My point is MS if you have to work on something like johenmo has put as three points he will work on you are far better working on skill. The rest will follow.

 

[Cartman]

then 75-100% of your coin on the table is no problem...

not all on one race i hope TB

Which one will you take? Shootings skills or a calm approach to blowing your partners head off???

mmmm --- are we talking business partner or girl friend? --- might alter the answer lol

you are far better working on skill. The rest will follow.

its a good point TH ----- i know a cupla pro boxers ----- without the skill level in place, all the head stuff would be a waste of time --- but the brain stuff is important at the tapering stage to hone in on the zone

 

[aarbee]

BS.

That people of very high ability are completely in control of their emotions - tiger Wood being the prime example here. But that's the end product. The result of practise and the confidence of ones skills and abilities to achieve something.

I could bang on about this for ever .

MS+Tradesim is quite right in pointing out that it is not one or the other.

TH,
Your Somali pirate analogy is really irrelevant in view of above.

I am sure you can go on forever on the subject. It’s typical of “Bee in the Bonnet Syndrome”
As for your Tiger Woods example, think of the The Shark’s example of choking repeatedly. It wasn’t that he suddenly lost his skills at the crucial time. It was just that he did not have the mindset that sets Tiger Woods apart from the rest. "people of very high ability are completely in control of their emotions" - Don't you think this ability to control emotions would be a function of mindset. Perhaps, you would say it is skill development. If that is the case, then you are working on your mindset while honing that particular skill.
It’s the mindset that ensures that so many people in all walks of life throw it all away after overachieving in their own field. It was the skill that made Heath Ledger famous and it was his mindset that cost him his life. Without the winning mindset the most skillful can lose all.

I repeat, that in your case despite your protestations to the contrary, development of a particular mindset most likely came about subconsciously or by external nurture or by association or in the guise of "skill development".

Cheers

 

[Trembling Hand]

Ok gents knock yourself out working on mindset. Just keep an eye out for traders that have been at the game for a while people like Nick Radge and Frank D. See what they talk about. More to the point see what they don't

 

[beerwm]

Hi TH

I'd just like to know why you stop trading when u hit a 0.5% loss.

Your system is obviously designed with a positive expectancy which can only be guaranteed the more you trade, likewise your approach to increasing your position size on 'good days.'

wouldnt the more you vary your system the more gamble you take on your expectancy being recognized.

Is your system partial to your daily attitude/mindset? or specific mechanical entry/exits?

thanks