When I finished the trading courses I dreamed to be a successful intra-day trader. In those days I didn't thought about something else except speculation trading and intra-day setup's; I worked so hard to gain few dollars and in the day after I worked harder to keep them in my pocket.
Like most traders- the first year was not profitable at all. I lost more money than I could afford and after the first year I get kicked out from the game.
loosing almost tree times monthly salary is something that single can live with, but without serious conclusions I cannot make sure it will not happen twice.
There is nothing depressing than sitting on the fence
While I'm understanding what's happened and why for god sake I cannot afford myself trade anymore I decided to create 'Path for success'
I mean recipe, ToDo list:
- Reading professional books – If you like to be a successful trader – you have to expose yourself to known names who succeeded and wrote about it. You have to learn the way they think and act.
- Plan your trade, Trade your plan – Raschke first rule says that you have to understand what you're looking for. don't trade like a leaf in the wind. Trading without plan can be very expansive!
- Invest in your social network – Keep in touch with other traders especially in the beginning, Sharing positions and consultation together can shorten your learning curve and even assist you being profitable early.
- Break up your self-esteem and ego – The capital market is the best gym for mentally. Always remember you're only a person. Don't trade with ego or honor. If you do not learn how to give up your self-esteem and ego, the capital market will teach you that, and it will be extremely expansive
- Stay simple – yes, I know you learned how to trade like the greatest names but you have to keep in mind that trading in the capital market require SIMPLE thinking. Don't waste your time on unclear situations. if you don't understand something don't test it with your own money. Always remember that the capital market is a microcosm of the society we live. Keep your focus on the meaning, not on technical matters.
There are many great tips, but I choose the best five tips for beginners.
You can add your own in replies
Have a great weekend!
Linda Bradford Raschke known as one of the top traders in United States, She mentioned in The New Market Wizard, one of the most popular trading book.
She also published excellent trading advice that every successful trader have to know.
I want to expose this wonderful asset, just because it may assist you, as this wonderful trading rules assist me to be the trader I always want.
Have an enjoyable reading:
- Plan your trades. Trade your plan.
- Keep records of your trading results.
- Keep a positive attitude, no matter how much you lose.
- Don’t take the market home.
- Continually set higher trading goals.
- Successful traders buy into bad news and sell into good news.
- Successful traders are not afraid to buy high and sell low.
- Successful traders have a well-scheduled planned time for studying the markets.
- Successful traders isolate themselves from the opinions of others.
- Continually strive for patience, perseverance, determination, and rational action.
- Limit your losses – use stops!
- Never cancel a stop loss order after you have placed it!
- Place the stop at the time you make your trade.
- Never get into the market because you are anxious because of waiting.
- Avoid getting in or out of the market too often.
- Losses make the trader studious – not profits. Take advantage of every loss to improve your knowledge of market action.
- The most difficult task in speculation is not prediction but self-control. Successful trading is difficult and frustrating. You are the most important element in the equation for success.
- Always discipline yourself by following a pre-determined set of rules.
- Remember that a bear market will give back in one month what a bull market has taken three months to build.
- Don’t ever allow a big winning trade to turn into a loser. Stop yourself out if the market moves against you 20% from your peak profit point.
- You must have a program, you must know your program, and you must follow your program.
- Expect and accept losses gracefully. Those who brood over losses always miss the next opportunity, which more than likely will be profitable.
- Split your profits right down the middle and never risk more than 50% of them again in the market.
- The key to successful trading is knowing yourself and your stress point.
- The difference between winners and losers isn’t so much native ability as it is discipline exercised in avoiding mistakes.
- In trading as in fencing there are the quick and the dead.
- Speech may be silver but silence is golden. Traders with the golden touch do not talk about their success.
- Dream big dreams and think tall. Very few people set goals too high. A man becomes what he thinks about all day long.
- Accept failure as a step towards victory.
- Have you taken a loss? Forget it quickly. Have you taken a profit? Forget it even quicker! Don’t let ego and greed inhibit clear thinking and hard work.
- One cannot do anything about yesterday. When one door closes, another door opens. The greater opportunity always lies through the open door.
- The deepest secret for the trader is to subordinate his will to the will of the market. The market is truth as it reflects all forces that bear upon it. As long as he recognizes this he is safe. When he ignores this, he is lost and doomed.
- It’s much easier to put on a trade than to take it off.
- If a market doesn’t do what you think it should do, get out.
- Beware of large positions that can control your emotions. Don’t be overly aggressive with the market. Treat it gently by allowing your equity to grow steadily rather than in bursts.
- Never add to a losing position.
- Beware of trying to pick tops or bottoms.
- You must believe in yourself and your judgement if you expect to make a living at this game.
- In a narrow market there is no sense in trying to anticipate what the next big movement is going to be – up or down.
- A loss never bothers me after I take it. I forget it overnight. But being wrong and not taking the loss – that is what does the damage to the pocket book and to the soul.
- Never volunteer advice and never brag of your winnings.
- Of all speculative blunders, there are few greater than selling what shows a profit and keeping what shows a loss.
- Standing aside is a position.
- It is better to be more interested in the market’s reaction to new information than in the piece of news itself.
- If you don’t know who you are, the markets are an expensive place to find out.
- In the world of money, which is a world shaped by human behavior, nobody has the foggiest notion of what will happen in the future. Mark that word – Nobody! Thus the successful trader does not base moves on what supposedly will happen but reacts instead to what does happen.
- Except in unusual circumstances, get in the habit of taking your profit too soon. Don’t torment yourself if a trade continues winning without you. Chances are it won’t continue long. If it does, console yourself by thinking of all the times when liquidating early reserved gains that you would have otherwise lost.
- When the ship starts to sink, don’t pray – jump!
- Lose your opinion – not your money.
- Assimilate into your very bones a set of trading rules that works for you.
Want to learn more? Wanna be successful trader? Contact me!
In the middle of the 60's professor Eugene Fama developed the Efficient Market Hypothesis;
Eugene argued that stocks always trade at their fair value- witch means the price contains all the news stories, opinions and expectations for now and for future. This theory making it impossible for investors either trader to purchase undervalued stocks or sell stocks for inflated prices. Because the share price, at any given moment, reflects the full economic value of the company.
When the hypothesis first published, investors thought EMH is conspiracy because perhaps in the same period of time, the fundamental analysis was the common method for most of traders and saying that:
Stock price contains all the news stories, opinions and expectations
eliminates the basics of the faith of fans fundamental analysis. But over the years, more studies have been published witch confirmed the efficient market hypothesis. These studies found a positive correlation between EMH and price action. Naturally, with the strengthening of the technical analysis theory among many traders – the EMH has become more popular.
There's a huge gap between the different theory (technical & fundamental) and as I understand if you want to succeed you have to combine both fundamental and technical analysis. Last two month I invest my all learning the principles of Fundamental analysis so I don't think this theory is wrong, I just think that sometimes this theory doesn't working.
Something made me stop believe that price contains all the information all the time.
No, sometimes it just doesn't work at all. This is a true opportunity as trader or investor to get in and taking a fantastic position. My philosophy combine both technical and fundamental analysis – we're looking for unfair price in very good company and the rest is history 🙂