Overtrading doesn't exist for someone who trades a proven methodology. If you are looking for a Holy Grail trading system, stop the search, there is none! You are the key to the trading conundrum. If you feel uneasy or conflicted, it's probably not a good idea to trade. Take the day off and. Without self-discipline, trading success is impossible, period! Trading is meant to be a challenge, and challenges make you grow.
Those who can free themselves from their thinking will surely make it in the markets. In the end, the monetary gains aren't the real prize. The journey is! In trading or in life, never compare your chapter 1 to someone's chapter Great trading stems from great trading practices. The way to trading mastery is not in the myriads of systems. The way is in the mind.
Can you make money in the markets? Is it easy? Hell no! It will involve all your beliefs about failure, money, being right, uncertainty, etc. Trading mistakes are a function of the internal dialogues we have with ourselves. Trading mastery is the kind of dialogue we don't have! How can you expect consistent trading results if you don't have consistency in your life. Do not dwell on past trades; do not dream of future trades. Concentrate the mind on the current trade. As traders, our biggest problem is our thoughts.
Reduce the thinking to the bare minimum! Good trading will make your day or week, but it takes entrepreneurship to make a trading career. Successful trading is a function of the kind of habits you have. Unsuccessful trading also! You decide which one you want. If you can't turn your attention inwards, you can't be a trader. Simple as that! We cannot flow with the markets when we are too much in our heads. We all have dreams of making enormous amounts of money in trading. But it takes a lot of determination, dedication, and discipline to make that dream a reality. No matter how long it takes for you to become successful in trading, if you work hard at.
Trading is a game of inches. Everything that contributes to providing us with an edge shouldnt be ignored. Sleep, nutrition, hydration, exercise all these things matter!
100 Amazing Psychology Facts
Maturity as traders is when we are able to detach ourselves from our ego. This liberates our potential to trade from a care-free mindset. If you are trying to become a successful trader, there will be roadblocks. I've had them; everybody has had them; but obstacles dont have to stop you.
Trading success is never permanent, and failure is never final. Enjoy the journey! Trading should be made as simple as possible, but not simpler. If there ever existed no possibility of failure, then trading success would be meaningless. If you want to outstanding results in the markets, you have to be willing to fail. The pessimist trader complains about unexpected market action; the optimist trader expects it to change; the realist trader adjusts Trading to the best of your abilities at this moment puts you in the best place for the next trade.
The good trader is a doer, not a dreamer! Don't compare your results to someone else's. You can never be another person; you can only be a better version of yourself. The difference between a pro trader and an amateur lies not in their methodology, not in their knowledge, but rather in their ability to follow their set of rules. We, traders, either suffer the pain of discipline or the pain of regret. Your motivation to succeed as a trader must be absolutely compelling in order to overcome the obstacles that will invariably come your way.
Nothing is ever wrong. There are no mistakes; no failures. We learn from every step we take. Whatever you did today in the markets was the way it was meant to be. Find wisdom in your every action! Every success story in trading is a tale of struggle, reassessment, and adaptation. Your beliefs about myriads of things have the power to create your success in the markets. It also has the power to destroy your account. It is the worry that gets you, not the actual loss. You must expect failure as part of your trading journey. Failure and success go hand in hand; you cannot have one without the other.
We need emotional intelligence when trading the markets. It is not all math and logic. And that is what makes it challenging for most. Trade well in the present and your future results will take care of themselves. Don't just read trading books and blogs. You may be entertained by them, but you will never grow from them without practical application.
As a trader you must face your fears and limiting beliefs about money, certainty, being right, etc. Luck is predictable in the markets. If you want more luck, take more chances. Be more active. There is no overtrading if you have a tested methodology. Successful trading is a matter of waiting for the right moment to act. The point is not to avoid trading losses but to go through them with stability.
If you want to trade for a living, decide today that you won't give up on your dreams and keep pressing. Understand that there is no greater wealth in this world than peace of mind. Work on that instead. Money will take care of itself. You will never trade consistently until you change something you do daily. Your goal is not to be better than the other trader next to you. Your goal is to be better than the person you were yesterday.
I think all traders should find the time to sit in meditation for 20 minutes a day -- unless they dont want to, or they're too busy, then they should sit for an hour! If you are not a risk taker, you should get the hell out of trading. However many trading books you read, however many traders you follow on social medias, what good will they do you if you do not act?
It is the trader's own mind, not the markets that causes him to lose. That's trading in a nutshell. As traders, we've got one job, and it is to get better at what we do. Forget the damn money already; it is causing you to shoot yourself in the foot! No one can bring us trading success but ourselves.
We, ourselves, must walk the path. Keep calm. You will not be punished for your anger and frustration; you will be punished by them! It is imperative to make your trading decision before you enter your trade, before you are subject to the wild emotional swings. Trading small will help you keep emotions in check.
You will have plenty of time to increase your trading size once you become a competent trader. Be sure to put on many small trades and carefully document every entry and exit. Good records allow you to learn from experiences. If you don't have these three, don't compete! Even though we talk about "trading the markets", we can only trade our rules. So trade them well. Every time you choose to perform a good or a bad trading habit, its a vote for that type of identity. The longer you trade, the more you learn -- practice will make you a better trader. Believing that markets will conform to your expectations on a trade by trade basis will be met by sheer frustration, disappointment, and ruin.
You have power over your mind not the markets. Realize this, and you will improve your trading. People erroneously see trading success as an event. It is not! It is a process! If you know neither the markets nor yourself, you will succumb in every battle. Fear, greed - these only exist in your mind! So when you practice staying outside of your head, that's when you begin to see markets objectively.
If you have lost money today, think of what a privilege it is to be able to participate in this game. What challenges us makes us grow. Discipline as a trader means doing what you should do rather than what you want to do. Anyone can call himself a trader; however, a good trader shows what he is really worth when he is tested by the markets. If we want better trading results, the quality of our decisions has to improve. Never give up on a trade until a risk management stop-loss has triggered. Desire is what gets you started as a trader; discipline is what gives you results.
You will rarely catch the top or the bottom, so most of the time be content with a chunk out of the center. If you know the markets and know yourself, you need not fear the result of a hundred battles. Most people dabble their way through trading, never deciding to properly test and master a particular trading strategy. Big Mistake! Experience is knowing when to enter a trade and when to exit it. Skill is knowing how to do it.
Virtue is doing it. Dont blame markets for your decisions.
Take responsibility, your trading will improve. Nobody's a natural at trading because all of this stuff is counter-intuitive to our nature. You have to work hard to get good at it. Once you choose to accept yourself as a trader, then, and only then, can you work on being the best version of yourself that you can ever be! The function of risk management is not only to preserve your capital; it's also to protect. Be thankful if trading is a little harder than you'd like.
A chunk of coal cannot become a diamond without heat and pressure. Traders who accept that the future is unknown generally don't personalize their positions and cut ties quickly. Dont give up what you want most market success for what you want now short term emotional gratification. When you embrace uncertainty that is when markets start giving to you, instead of taking from you. Trading is a very psychologically rewarding endeavor because it often looks like it cannot be done. Trading success can be a function of two things: Luck, or skills.
One can leave you in an instant; the other is more durable in time. It is not a problem to make trading mistakes; everyone does, but it is a problem if you don't learn from them. Losing traders think they have all the answers. They cant learn because they're busy telling everyone what they know.
Being a trader is ultimately an act of competing against yourself. It's about selfimprovement; about being better than you were the day before. Good traders come in each day with a plan formed outside of market hours. They know their levels; all they must do is click.
4 Trading Psychology Pitfalls that Might Blow Your Forex Account
Only to the extent that you expose yourself over and over again to trading losses and failures, can that which is indestructible arise within you. It is much easier to trade fearlessly when you embrace failure as your teacher. Trading success isn't the key to happiness. Happiness is the key to trading success. If you love trading and work hard, you will be successful. It is ok to admire someone else's trading results, but never compare them to your own.
We all trade different time frames, methods, and beliefs. To become a trader is to study the self. To study the self is to forget the self. Show me a trader who has never made a mistake, who has never experienced failure, and I'll show you someone who has never achieved success. The goal of a good trader is not to make money but to trade well. If a trader trades well, money will follow. Every trading decision you make is not a decision about what to do. It's a decision about who you are! Traders: above all, enjoy the ride!
The market itself is your teacher, and you are in a state of constant learning. Accept the lessons with grace. If when you lose on a trade, you learn from your mistakes if any , and it motivates you to work even harder, youre onto something! Knowing the game is not enough, we must apply. Willing is not enough, we must do! To improve as a trader is to be open to change. Discipline in the markets is the bridge between goals and accomplishment. Trading success is an iceberg. People only see the top. What lies beneath is failures, mistakes, losses, persistence, and hard work.
Adversity causes some traders to break; others to break records in terms of results. It is ok if you trade and lose, but it's not ok if you fail to trade. Success comes when you take your chances. Stay active, trade small, and keep learning. If you follow your dreams and spend your life doing what brings you joy, you are more likely to find success.
Our health always seems much more valuable after we lose it. Don't make trading the center point of your whole life. Money is just something we need in case we don't die tomorrow. Trade for the love of trading, not for the love of money! If you assume that your excellent math and analytical skills will automatically translate. The mental resistances you fight in the markets and the ones you fight in life are one and the same. Once you prevail over them, you take control of your life. The voice in your head that says, "You can risk it all on that one trade" is a liar.
Winning in the markets can be a function of skills or luck. If it comes through luck, take the damn money and run! If it comes through skills, rinse and repeat. Success in the markets isn't something that just happens. It is acquired through sheer perseverance in the face of failure. Everyone gets their ass handed to them by the markets at some point. Only the best get back up. If trading success is important enough to you, you will find a way. If it is not, you will find an excuse. If you believe enough in your trading process, success will come to you.
You just have to be willing to see it through to the end. New traders: don't find the time to research the efficacy of your system, make the time! Losses are intended to make us better, not bitter! Never let a winning trade go to your head, or a losing trade to your heart.
Be decisive in your trading. A wrong decision is generally less painful than indecision. Durable success in the markets isn't given. Its earned! Trading opportunities are like taxis, there's always another one coming. Dont get attached to any single trades. In the markets, we will act consistently with our view of who we truly are, whether that view is accurate or not. After each trade, I want to be able to say "I executed the trade to the best of my abilities.
There are two types of traders: Those who truly desire success and those who are trying to avoid failure. The question is which one are you? First rule of trading: everything is your fault! The sooner you accept this, the sooner you can work on improving the quality of your decisions. As a trader, your job is to befriend uncertainty!
If you struggle with losses, ask yourself this: What's the worst thing that could happen as a result of those losses? Your answer should put a stop to your cataclysmic thinking. In the end, trading is simply acting on what you can control as opposed to acting on what you cant control. A good trader knows himself and works on leveraging his strengths as opposed to fixing his weaknesses. Profits, although amazing, dont teach you much. Losses are the real prize!
Remember this: Its not how you start; its how you finish! You can do this; you can be a successful trader. His writing is easy to follow and you can tell he genuinely wants to make you aware of the dangers, and advise you on how to manage them. This is one of the top books because there is so much detailed instruction on how to set up trades. He leaves no stone unturned as he breaks down numerous strategies and different markets. One of the best selling day trading books, you get to benefit from the experience of one of the most highly regarded analysts in the forex world.
A lot of good books focus on technical analysis, strategy and risk management, but not so many focus on the complexities of trading psychology. The book details why not yielding to your emotions is harder than it sounds and offers you a multitude of tips for keeping calm and getting in the right headspace. The author focuses on market philosophy and delves into his own trading psychology. The only thing to point out is that this book was written during the highly volatile period of the dotcom boom, so some information may be outdated.
If you want strategies you can take from the book and apply with ease then this is a good choice. You get a number of detailed strategies that cover entry and exit points, charts to use, patterns to identify, plus a number of other telling indicators. This book gets glowing reviews and is written in an engaging way, giving it appeal to a wide audience. The book explains why most strategies such as scalping struggle to overcome high intraday costs and fees. This is a self-proclaimed step by step guide, taking a complex system and making it easy to follow.
The success of this book comes from the clear instructions you get around entry and exit rules, how to capitalise on small intraday trends, plus advice on the software you do and do not need. The author also keeps it light-hearted and engaging throughout, making it one of the must read trading books. There are no mincing words, it offers you practical advice from page one on how to trade futures effectively. You can also apply the philosophies and strategies found here to any number of intraday markets. ETX Capital are currently offering a range of educational tools to traders.
They are free to enrol for any traders who have made a deposit of any size. More details can be found here. Courses are delivered by in-house experts at ETX, and an independent trading company. After trading fix time period, you may switch on those stock that shows movement at that time. Some Key points are given below Price movement Good bouncing history in a trading day Selective stocks with high degree of volume Be flexible to target- so habitual to book profit Trade intra-day while keep in mind for intra-week for square off purpose Do not try to break your own made rule If you have trading experience less than 2 year, please avoid trade on margin money completely.
But extremely avoid margin money during panic time. Key Points for Yourself Friends — Intra-day trading require some essential things. Mind Controlling Power — Friends doing intra-day trade is like driving a car riding bike. How fast or slow you are driving is not much important, how much control you have on your car it is the main thing.
Frankly I am saying here if you have mind Good Analytical Power, how fast you can observe the things happening surrounds you , then only you are made for Intra-day Trading. So please re-study yourself about this features you know yourself more than others. If you think you are not fit here, just focus on investment, forget intra-day trade.
Skills Knowing everything means not confirm here, you can do everything. Doing needs regular practice. So person, who wants to be in intra-day trading, needs mind and skill more than others. It is extremely essential things. You should know very well that how to place order quickly you may go virtual trading for making yourself skilful 3.
If any movement show opportunities to earn just do it…..
The Psychology of Money · Collaborative Fund
Emotionless It is the thing which decides that you are going to make profit or loss. My advised to choose a brokerage house which give unlimited trading facility, at the same time, never compromised with quality features and value added services. In better word, there should be lowest cost of trading. Presently by last 2 year, I am happily trading Ventura and making good profit. Use of Margin Money facilitated by broker. An Intra-day trader is like mobile shop owner who is dealer cum retailer precisely only dealer ……here you work start…..
Many people in share market consider intra-day trade like gorilla war…. They go in war with pseudo confidence you know why. As long as they face small kind of contenders, they win and acts like a king. But when real attack comes from all corners, they not only lost the war, but also, they have to work for own survival for existence. You work very hard to generate tools to fight; you should know how to use the tools. So train yourself. Generate skills But be sure, it does not come in one day, need regular practice Intra-day traders lose money just because of working like gorilla war. This type of person wants to just live their life.
They understand themselves a king. These traders win days in small amount , and lost all with one big attack that come around all corners…. Thanx Manish for sharing your story. It seemed like my story. Since realising that it is no gain game for me, I have been trying to detoxify my self from trading addiction and you have reinforced my resolve. I am now buying shares only in form of Monthly Equity Plan and holding on to them to satisfy this urge of trading.
Hi Manish, This is the story of every first time trader who enters stock market. If you are a fn0 trader, you would not trade many; Many serious traders stick with only one e. NIFTY and be with it forever. Although, options look simple min. Sharing it so that someone might find it useful. Just investing niftybees on a periodic basis could give a new comer a good introduction to stock market.
Just wanted to know your opinion.
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I also want to share my experience in this field.. I have been investing since My rolling money is very less close to 5 L…usually trade equities and IPO. As your said there are times we will be in greed , confusion while trading. I am happy if I get atleast Rs profit excluding the brokerage.. I will calculate and compare — how much I will get if I deposit in FD for so many days and what is the return if I hold the stock for some many days…it always gives me profit of atleast bucks more then FD value.
Hence satisfied. I always keep switching sector of stocks.. I will put ny bet on hot stocks only. Not sure is this is correct strategy.. One advantage is I can easily withdraw money if I ma in need.. Thats great.. Once upon a time was heavy trader. Collected around Rs. Its all about guessing what millions of other people are guessing. No model on this earth can predict human behavior which is irrational. Better to buy entire market via Index funds.
Takes care of everything. I am a vivid reader of your blog. Investment is an Art not a Science. I am not good in number but i have invested in good stocks. In stocks of company which have grown along with me. Anyway good information from your side. It seemed like I am reading my own story in your words. I have felt each and every fact mentioned in this post. Just used to look at the charts and predict a turn-around or continuation which used to reverse after some time and I used to see my profits getting converted to losses and still try to hold them till them become too much.
Both occasions caused me huge losses. Finally, I am into Value Investing and doing great there. Will get back to options when I have enough of money, strategy and knowledge on how they practically work. I went through the exact same thing in I thought of investing in stocks, when one of my friend told me about options. I made all possible mistakes. But 1 fine day I decided to quit. After that the market has grown but I am afraid to trade again. Manish Wonderful peace of knowledge i felt it was exactly my own story. Slippage a stop loss at one price but it gets filled at a substantially different price is very common in options and futures esp.
And one needs to be very very accurate in timing the whole thing ; I mean your intended move has to happen before expiry or it expires worthless. But in FnO it is very very many times difficult to make consistent profits. The whole thing can make you feel you have a control but actually you may not. If someone to ever try FnO sticking to fewer lots is must. Or we can even lose our shirt. When it comes to Technical Analysis ; it is easy to come back and say this move was so obvious; but doing analysis and coming to an actionable item when it is actually about to happen is not.
Very thought provoking article. Now this is needed as the stock trading is picking up pace even in smaller towns in India. Those who invested in ,I believe are first time investor in the age of 30s. Hello All.. Most of the people here are discussing the fallacies of trading in markets.. How and what were the reasons for the losses that they have encountered..
All true.. But here, I remember a line from one ebook which I read on markets from one pro trader.. Stock trading or any trading cannot go so easy.. It has to b done with proper knowledge and research.. Just ask yourself, r u ready to do any business in the world even the same business ur next door neighbor is doing?
This is bcoz we dont understand all businesses equally well.. As a lawyer cannot operate a person, so does a doctor cannot file legal cases.. Same applies to stock trading as well.. Trading also requires a dedicated approach.. The approach should be clear.. Market is ruthless, unless u r strong enough to safeguard yourself from its blow, u r bound to be injured.. And the injury here is on your financial front as only money is concerned here and money in current day is the blood for life..
Understand the business of trading.. Clear yourself of wat return u will get for the amount of risk taken.. The beauty of market lies in the fact that, both risk and returns can be quantified beforehand.. In the process of attaining efficiency in Point No. That is the goal.. They take things professionally.. My analysis says, that Mutual Fund houses, brokerage firms, hedge funds are some names who win this battle..
And the biggest looser here is the retail trader.. My experience is positive about stock market. Started investing in Felt i ll be millionaire soon, here comes great crash in January Did not know what was going on, lost all my gains in less then 6 months. But i am earning enough to digest those losses. I never borrowed a penny to invest in market and no one should do it.
My whole portfolio was probably less then 6 months savings. Realised not for me, started learning about principles of market, read good few books. Which has tripled in value. So I have positive things to say about it. My learnings are,.
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Be prepared for losses. If there were only gains why would i waste my 5 days a week working for someone. Change your allocation periodically and never put all your eggs in one basket. Invest profits from stock markets elsewhere in physical assets preferably or in recurring FDs. Thanks for sharing your experience Amit.. I am sure there is a lot to learn from it for others! I am working in Financial Services Industry for last 16 years.
I feel for making money in Stock Market, you need to stay put in stock market. Though there can be more than one way of making money, the most important thing according to me is that never leave stock market. Those who are able to survive for long in Stock Market automatically learn their own rules to make money from Stock. Hence Safety of Capital is of paramount importance at all points oftime.
I am not a newbie or veteran of markets. Investing in market for the last 12 years on and off. It is not about profits or loss, am trying to fight some addictions to get rid of. Earlier I used to refresh on hourly basis. Now I came down to times in a day. When I consider myself as LT investor, unable to get on why am tempted to see the market status hourly or daily basis.