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SUCCESSFUL TRADING by @TraderHMS.
(thread)
(thread)
1/ Have a PLAN
You need to have a solid trading plan. The trouble is that most traders trade without any definitive WRITTEN plan. Trading is a business and all successful businesses need a business plan to guide decisions and operations.
You need to have a solid trading plan. The trouble is that most traders trade without any definitive WRITTEN plan. Trading is a business and all successful businesses need a business plan to guide decisions and operations.
2/ DEFINE your methodology
What exactly is your methodology? If you cannot answer that question, you are not ready to be risking money in the markets.
What exactly is your methodology? If you cannot answer that question, you are not ready to be risking money in the markets.
3/ No EDGE, no trade.
No amount of focus on the mental game can substitute for skill and preparation and the need for strategies that possess an objective edge in the marketplace.
No amount of focus on the mental game can substitute for skill and preparation and the need for strategies that possess an objective edge in the marketplace.
4/ Avoid short-term COMFORT.
Short-term comfort translates into a downward sloping equity curve. Sitting with losers and taking small profits may feel good but will cost you a disproportionate quantity of money over time. Don't do it.
Short-term comfort translates into a downward sloping equity curve. Sitting with losers and taking small profits may feel good but will cost you a disproportionate quantity of money over time. Don't do it.
5/ Stop looking at your P&L during the trading session
Traders who are obsessed with the value of their accounts during the course of the day are destined to fail. Attachment to money will make you trade poorly. TRUST your process and check your account balance ONLY on weekends.
Traders who are obsessed with the value of their accounts during the course of the day are destined to fail. Attachment to money will make you trade poorly. TRUST your process and check your account balance ONLY on weekends.
6/ THINK before you act.
Successful traders spend more time identifying good trading opportunities than actually putting on and managing trades.
Successful traders spend more time identifying good trading opportunities than actually putting on and managing trades.
7/ Don't OVERTRADE.
The ability to watch the market and not being tempted to trade it outside of your predefined trading plan is rare and very valuable. Stay strong.
The ability to watch the market and not being tempted to trade it outside of your predefined trading plan is rare and very valuable. Stay strong.
8/ You need EXPERIENCE.
There are no overnight successes in trading. The most important thing to becoming a good trader is to trade. You have to pay your tuition fee (time and losses).
There are no overnight successes in trading. The most important thing to becoming a good trader is to trade. You have to pay your tuition fee (time and losses).
9/ Don't trade too BIG.
If people can tell by looking at you whether you're having a good or bad day in the markets, your positions are too big. SIZE accordingly.
If people can tell by looking at you whether you're having a good or bad day in the markets, your positions are too big. SIZE accordingly.
10/ After you do the work, you must have CONFIDENCE in yourself.
You must believe that you will win in the long term if you stay on course. You cannot win if you don’t believe in yourself.
You must believe that you will win in the long term if you stay on course. You cannot win if you don’t believe in yourself.
11/ Find your NICHE
A trader that chooses to be master a specific type of trading method or trading vehicles has a much better chance of success than the traders that dabbles in many different things and is unable to make much progress.
A trader that chooses to be master a specific type of trading method or trading vehicles has a much better chance of success than the traders that dabbles in many different things and is unable to make much progress.
12/ QUANTIFY everything you can about your trading.
Quantified trading is knowing if you trade your pattern/setup enough times your edge will show up.
Quantified trading is knowing if you trade your pattern/setup enough times your edge will show up.
13/ Trading EDUCATION is important but there is no substitute for EXPERIENCE.
More anatomy study won't make you a surgeon.
More anatomy study won't make you a surgeon.
14/ Be ORIGINAL and FLEXIBLE
You need to find a trading niche (11) and need to adapt to changing market conditions.
Originality and flexibility are two good predictors of long-term trading success.
You need to find a trading niche (11) and need to adapt to changing market conditions.
Originality and flexibility are two good predictors of long-term trading success.
15/ Learn to LOSE
What winning traders share: they all understand that losing is part of the game, and they have all learned to lose. Accept losses gracefully and move on to your next trade(s). New highs on your equity curve will come from trades you are yet to make.
What winning traders share: they all understand that losing is part of the game, and they have all learned to lose. Accept losses gracefully and move on to your next trade(s). New highs on your equity curve will come from trades you are yet to make.
16/ A TRADE is just a TRADE
Each trade is just one of the next 100 if position sized right. Do not lose sleep over it.
Each trade is just one of the next 100 if position sized right. Do not lose sleep over it.
17/ Being in SYNCH with the markets
If you act in sync with the market, you will do fine. If you choose to argue with the market, it will surely make you poor. Learn to watch the market as you watch a game where you have no interest in both teams. A dispassionate look.
If you act in sync with the market, you will do fine. If you choose to argue with the market, it will surely make you poor. Learn to watch the market as you watch a game where you have no interest in both teams. A dispassionate look.
18/ TEST the market
You learn a lot about a position just by having a small trading position on.
You learn a lot about a position just by having a small trading position on.
19/ Be SENSITIVE to change.
The market conditions do change. The real skill for a system trader is to understand when to change a system or when to tweak it or when to adapt it or even when to throw it into the waste paper basket and develop a new one.
The market conditions do change. The real skill for a system trader is to understand when to change a system or when to tweak it or when to adapt it or even when to throw it into the waste paper basket and develop a new one.
20/ Be CONSISTENT
You want to get in the habit of making the same trades over and over again.
You want to get in the habit of making the same trades over and over again.
21/ MOVE around. Stay HEALTHY.
Physical exercise sharpens the mind. Drink a lot of water during the trading session. Trading is a game of inches. Every single detail counts.
Physical exercise sharpens the mind. Drink a lot of water during the trading session. Trading is a game of inches. Every single detail counts.
22/ Avoid BURNOUT
Burnout occurs when four key components of well-being are absent from our daily experience: joy, satisfaction, energy, relationships. Feed them.
Burnout occurs when four key components of well-being are absent from our daily experience: joy, satisfaction, energy, relationships. Feed them.
23/ Put MONEY aside just for trading.
Distance yourself a little bit from the money. You have to take that money and you have to say this is for trading.
Distance yourself a little bit from the money. You have to take that money and you have to say this is for trading.
24/ Trading is HARD
It is easier to lose money when trading poorly than it is to make money when trading well.
It is easier to lose money when trading poorly than it is to make money when trading well.
25/ Write a trading JOURNAL
Make little observations about what the market is doing and you’ll come up with lots of ideas. Write your notes on a trading journal.
Make little observations about what the market is doing and you’ll come up with lots of ideas. Write your notes on a trading journal.
26/ Fight for your MONEY
When a trader loses money trading futures, it isn’t gone. It has just been moved into another trader’s account.
When a trader loses money trading futures, it isn’t gone. It has just been moved into another trader’s account.
27/ Have a BALANCED life.
There is more to life than trading.
There is more to life than trading.
