Thread by @chartians

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HOW TO BECOME 37.78 TIMES BETTER AT TRADING

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Have you ever struggled and thought about why aren't you making money in the markets ? The mere fact that you're thinking to make money than to enjoy the process makes your process to make money difficult in the market where money is made by money.

Hehe... Confused ?
Basically if you want to make money in the market. DONT THINK ABOUT MAKING IT.

We often forget to follow process and focus on the end result that is money.

Let's see how Atomic habits in Trading can make us 37.78 times better in Trading, or maybe not lol.

Full credits to - @jamesclear for his Book.

1. Massive action vs 1% improvements
Our brains have always been conditioned to be the best and have always told that massive success needs massive actions. But that isn't true and the same goes with trading.

1.01 for 365 days is 37 times better
But
0.99 for 355 days is 0.03

But hey in trading this equation doesn't help. Correct ? So what should we do to be better at Trading.

Instead of focusing on making your trading better or making money. Make yourself better.

Solution to your bad habits :

1. Exiting your postions based on your MTM value and not the charts and setup

2. Cloning trade ideas without assessment of risk on your own setup and your risk appetite.

3. Constantly hopping from one trade to other before the target and SL.

Linear progress are never noticable in the short run. Things like compounding, small losses and big profits with lower success rate. Strictly following your Stoploss. Staying in the trade and giving market it's own time.

These things are often boring and as James clear says. It is the Valley of Disappointment. This is the time where most traders give up. Usually the time when drawdown occurs, they give up on system thinking it's not profitable.

Be there. Things take time.

2. Forget about goals and Focus on system
As the statement says the best thing fir a trader to do is to focus on the system. Don't hop on to goals directly. Enjoy the process.

Goal is the outcome of religiously following the system.

Traders often want to change but they can't. The reason can be circle of incompetence. We usually talk about circle of competence. But least talked about is Circle of incompetence.

Be with traders that are very dynamic in their decision. Make or form a group of traders. Add a Bull, a bear, a person who had good index trades, a person who tracks OI, a person who had food fundamental knowledge and a person who is good in Algos.

This will help you evaluate every aspect of trading. Imagine you gng long but the bear listing a short trade. You might make money and he would learn what went wrong. He would earn and you would learn what went wrong.

Same goes with the guy with good Fundamentals. You might buy a bad business that's turn around in charts and he could give you a good business that's bad on chart.

Habit loop 🔄

Cue - Watch twitter gurus MTM

Craving - Urge to make the same amount

Response - Trade the same trade without analysing the risk

Reward - You suffer a loss but the reward is you get to learn not to clone others trades.

Let's get to know some laws of Atomic habits in trading that can be used in trading.

Law 1 - Make it obvious

Make it obvious, goals tend to fail not because of demotivation but due to lack of clarity. Clarity here means a Trading plan

Make Good Atomic Habits.
Trade - Setup - Risk

I will (Trade) stocks that come under my (Setup) with proper mngmt of (Risk)

- Use stick notes
- Place reminders in system
- Place price alerts at retest areas
- Risk first
- Make a risk calculator in Excel

Bad example
I will trade with SL

Good example
I will trade only in Nifty 500 after 9.30am with a trade not more than 2% of Risk on my Capital.

Law 2 - Make it attractive

Use a system called as temptation bundling so that your habit is attractive.

Let's say you make a profitable month or profitable week or a quarter. Reward yourself. Spend on yourself.

Ways to Temptation Bundling

- Fyers 30 days challenge (win and get 5,000₹ brokrage back)
- Buy a good setup with RGB lights out if your profits
- Go for dinner, meet your trader friends, subscribe to some good software (Falcon, Spider)

These things will keep you in the game.

Law 3 - Make it easy

Repitition is the biggest compounder of good habits.

Take an example of reading 15 mins of news before trading from 9 - 9.15 will give you a good idea of market outlook.

Pre marking of levels a day before so that you just have to go and punch orders at your terminal and levels.

Placing GTT orders for target and stoploss in system.

Do your homework everyday in the night to find out potential Breakout stocks.

Deactivate the FNO segment if you have suffered huge losses in FNO section and pratice with small qty in cash market.

Do it everyday. And see the magic.

Law 4 - Make it satisfying

If anything that you do doesn't give you satisfaction and isn't what you love you will ultimately have a slow death.

Make trading satisfying. One trick you can use is using Green and Orange colour to your win and lose trades instead of RED.

Use green for your winner days and Orange for your losing days trade logs (Personal trick)

Place reminders in system to update excel sheet regularly. Like a timer or alarm.

Satisfaction comes through comfort. And comfort in trading usually comes when you arent over leveraged.