Consistency and Compounding. These 2 words are possibly the most important words to be successful. But without patience and discipline, these words comes to naught.
What is consistency? It is to make every market execution a sure-fire one. Which means, to have a 100% hit rate.
What is compounding? In basic terms, double up. Otherwise, add on to your current stakes.
How does these both, work hand in hand?
Example;
Let's say, you are one heck of a patient guy and you look to add on 1 contract every month in a year. First of all, you need to be patient as hell, next you must be able to control your emotions, and lastly, you have to develop a mentality thinking that with a loss in a day, it is not the end.
So to avoid a 'loss' day, one have to be consistent at any given day! Most people would agree that with each +tick and +contract, the stakes are much higher. So thats where consistency comes into action.
Let's say you paper trade for a consistent 2 ticks per trade, or sometimes 4 ticks or more for a few months. You are pretty much ready to trade. But when you are paper trading, you have to try to do it like it is REAL MONEY. Psychology is important in every expects of trading.
Anyway, The goal is, to stay in the market as short as possible, make a minimum of 2 ticks and call it a day. From my own experience, you make a trade or 2 and you have gathered quite a nice amount of profit, and your brain tells you, 'hey man, keep going. It seems like a good day for you!'.
The next thing you know, all your profits for the day are wiped out, and you are eating into your account balance, not to mention excluding the exchange fees and commissions which would only add on. Now this is where, your discipline comes in play. Switch on your laptop, open up your trading platform. Look for that desired execution which you have been doing so for the past few months. Get the 2 ticks. Close the damn platform and go do whatever you want. Now, that is discipline.
To improve your discipline and patience, one must have CONVICTION. A conviction is to realize that I WANT TO DO THIS. I NEED TO DO THIS. That already means, you have a strong character right there. Trust me, failure for people with strong character and conviction is rare. Failures are people with insufficient patience and discipline.
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So back to my thread's title, $40,000 a year;
This amount of money, CAN be made with just a measly 2 ticks a day. Yes, you read that right. 2 ticks. one day.
How? Now thats the beauty of compounding. But to start compounding, you first have to be CONSISTENT! Without consistency, the art of compounding will just be a splat of paint here and there without a purpose.
2 Ticks a day is really quite small. Honestly, there are people out there getting 10 -100 ticks a day. But in that same sentence, you have to realize that, what I was talking about, was about THEM. Not you. You. Yes, you. You are more important to yourself, than them to yourself!
Back to topic. 2 ticks a day on the G6E or ES would amount to $25. We shall not include commissions and exchange fees for these calculations as this thread I am composing is for educational purpose only.
So with consistency of 2 ticks per trade and just one time a day. That's a cute $25 profit. In a month, that $500 based on 20 trading days.
Every month, you add 1 contract; eg: 2 Ticks a day ($25) x 20 trades a month (we will classify this as %yz.
January 1 contract x %yz = $500
February 2 contracts x %yz = $1,000
March 3 contracts x %yz = $1,500
April 4 contracts x %yz = $2,000
May 5 contracts x %yz = $2,500
June 6 contracts x %yz = $3,000
July 7 contracts x %yz = $3,500
August 8 contracts x %yz = $4,000
September 9 contracts x %yz = $4,500
October 10 contracts x %yz = $5,000
November 11 contracts x %yz = $5,500
December 12 contracts x %yz = $6,000
So after all these compounding, by the end of the year, you should have amassed a whooping $39,000! That's roughly over $3,000 a month on average. With just 2 ticks a day. That's all. Of course, if you are a better trader averaging a consistent 5-15 ticks a day, that would only do more good to your account balance with these actions in play.
Consistency and compounding. When used properly, is one of the recipe for success. I believe in this more than anything else when we speak of making money.
**
I hope you guys read this and contribute ideas or methods to make trading more enticing to the rookies out there like me!
PS: I just took about under an hour to compose this thread because I needed some motivation and I even realized certain things while composing this thread as well. I am not a veteran trader or someone with unparalleled market knowledge or experience, But I hope this thread would benefit the majority!
Thanks and Regards,
-Yubesh
What is consistency? It is to make every market execution a sure-fire one. Which means, to have a 100% hit rate.
What is compounding? In basic terms, double up. Otherwise, add on to your current stakes.
How does these both, work hand in hand?
Example;
Let's say, you are one heck of a patient guy and you look to add on 1 contract every month in a year. First of all, you need to be patient as hell, next you must be able to control your emotions, and lastly, you have to develop a mentality thinking that with a loss in a day, it is not the end.
So to avoid a 'loss' day, one have to be consistent at any given day! Most people would agree that with each +tick and +contract, the stakes are much higher. So thats where consistency comes into action.
Let's say you paper trade for a consistent 2 ticks per trade, or sometimes 4 ticks or more for a few months. You are pretty much ready to trade. But when you are paper trading, you have to try to do it like it is REAL MONEY. Psychology is important in every expects of trading.
Anyway, The goal is, to stay in the market as short as possible, make a minimum of 2 ticks and call it a day. From my own experience, you make a trade or 2 and you have gathered quite a nice amount of profit, and your brain tells you, 'hey man, keep going. It seems like a good day for you!'.
The next thing you know, all your profits for the day are wiped out, and you are eating into your account balance, not to mention excluding the exchange fees and commissions which would only add on. Now this is where, your discipline comes in play. Switch on your laptop, open up your trading platform. Look for that desired execution which you have been doing so for the past few months. Get the 2 ticks. Close the damn platform and go do whatever you want. Now, that is discipline.
To improve your discipline and patience, one must have CONVICTION. A conviction is to realize that I WANT TO DO THIS. I NEED TO DO THIS. That already means, you have a strong character right there. Trust me, failure for people with strong character and conviction is rare. Failures are people with insufficient patience and discipline.
----------------------------------------------------------------------------------------------
So back to my thread's title, $40,000 a year;
This amount of money, CAN be made with just a measly 2 ticks a day. Yes, you read that right. 2 ticks. one day.
How? Now thats the beauty of compounding. But to start compounding, you first have to be CONSISTENT! Without consistency, the art of compounding will just be a splat of paint here and there without a purpose.
2 Ticks a day is really quite small. Honestly, there are people out there getting 10 -100 ticks a day. But in that same sentence, you have to realize that, what I was talking about, was about THEM. Not you. You. Yes, you. You are more important to yourself, than them to yourself!
Back to topic. 2 ticks a day on the G6E or ES would amount to $25. We shall not include commissions and exchange fees for these calculations as this thread I am composing is for educational purpose only.
So with consistency of 2 ticks per trade and just one time a day. That's a cute $25 profit. In a month, that $500 based on 20 trading days.
Every month, you add 1 contract; eg: 2 Ticks a day ($25) x 20 trades a month (we will classify this as %yz.
January 1 contract x %yz = $500
February 2 contracts x %yz = $1,000
March 3 contracts x %yz = $1,500
April 4 contracts x %yz = $2,000
May 5 contracts x %yz = $2,500
June 6 contracts x %yz = $3,000
July 7 contracts x %yz = $3,500
August 8 contracts x %yz = $4,000
September 9 contracts x %yz = $4,500
October 10 contracts x %yz = $5,000
November 11 contracts x %yz = $5,500
December 12 contracts x %yz = $6,000
So after all these compounding, by the end of the year, you should have amassed a whooping $39,000! That's roughly over $3,000 a month on average. With just 2 ticks a day. That's all. Of course, if you are a better trader averaging a consistent 5-15 ticks a day, that would only do more good to your account balance with these actions in play.
Consistency and compounding. When used properly, is one of the recipe for success. I believe in this more than anything else when we speak of making money.
**
I hope you guys read this and contribute ideas or methods to make trading more enticing to the rookies out there like me!
PS: I just took about under an hour to compose this thread because I needed some motivation and I even realized certain things while composing this thread as well. I am not a veteran trader or someone with unparalleled market knowledge or experience, But I hope this thread would benefit the majority!
Thanks and Regards,
-Yubesh
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