Best Thread Featured Quick reference for real trading profit. Tips that work
SwingDoctor
Newbie
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Here are some of my rules and they seem to be working for me:
1) Buy stocks in a long steady upward trend in the hottest sectors.
2) Set tight stops every morning, you can always buy it back if you want it.
3) Set tight stops so you never lose more than 5% on any one trade. Protect capital at all costs.
4) Keep a notebook with all trades, support, resistance, target, stops and rationale, and when you closed the trade, what you learned from it.
5) Whenever you get burned badly, make a rule out of it, or figure out which rule you broke.
6) Always recheck the market in the afternoon 'cause things can turn ugly quick.
7) When the whole market tanks, sell everything and then short immediately, don't wait.
8) Keep it simple.
1) Buy stocks in a long steady upward trend in the hottest sectors.
2) Set tight stops every morning, you can always buy it back if you want it.
3) Set tight stops so you never lose more than 5% on any one trade. Protect capital at all costs.
4) Keep a notebook with all trades, support, resistance, target, stops and rationale, and when you closed the trade, what you learned from it.
5) Whenever you get burned badly, make a rule out of it, or figure out which rule you broke.
6) Always recheck the market in the afternoon 'cause things can turn ugly quick.
7) When the whole market tanks, sell everything and then short immediately, don't wait.
8) Keep it simple.
optionsmonster
Newbie
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entries
It has been my experience that how you buy wins the game. " a good entry covers a multitude of sins" ( bad exits)
It has been my experience that how you buy wins the game. " a good entry covers a multitude of sins" ( bad exits)
dont open in texas hold em with less than an ace-king , happens 4 out of three hundred hands, but when you take that pot,profit,now a pair of nines is a good staying hand...when your confidence is low you wait for the free money hand,4 out of 300, never make thenext trade,whn you havent made profit for awhile,and your still in business build your confidence with quick one lot trades , your charts, account,bottomline,sexlife,none of it works without your confidence,thats a long oneliner
rols
Experienced member
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Traders Log
Good stuff here by Brett Steenberger.
I think he gets to some core issues....
http://www.traderslog.com/steenbarger.htm
1. Trading affects psychology as much as psychology affects trading – This was really the motivating factor behind my writing the new book. Many traders experience stress and frustration because they are trading poorly and lack a true edge in the marketplace. Working on your emotions will be of limited help if you are putting your money at risk and don’t truly have an edge.
2. Emotional disruption is present even among the most successful traders – A trading method that produces 60% winners will experience four consecutive losses 2-3% of the time and as much time in flat performance as in an uptrending P/L curve. Strings of events (including losers) occur more often by chance than traders are prepared for.
3. Winning disrupts the trader’s emotions as much as losing – We are disrupted when we experience events outside our expectation. The method that is 60% accurate will experience four consecutive winners about 13% of the time. Traders are just as susceptible to overconfidence during profitable runs as underconfidence during strings of losers.
4. Size kills – The surest path toward emotional damage is to trade size that is too large for one’s portfolio. We experience P/L in relation to our portfolio value. When we trade too large, we create exaggerated swings of winning and losing, which in turn create exaggerated emotional swings.
5. Training is the path to expertise – Think of every performance field out there—sports, music, chess, acting—and you will find that practice builds skills. Trading, in some ways, is harder than other performance fields because there are no college teams or minor leagues for development. From day one, we’re up against the pros. Without training and practice, we will lack the skills to survive such competition.
6. Successful traders possess rich mental maps - All successful trading boils down to pattern recognition and the development of mental maps that help us translate our perceptions of patterns into concrete trading behaviors. Without such mental maps, traders become lost in complexity.
7. Markets change – Patterns of volatility and trending are always shifting, and they change across multiple time frames. Because of this, no single trading method will be successful across the board for a given market. The successful trader not only masters markets, but masters the changes in those markets.
8. Even the best traders have periods of drawdown – As markets change, the best traders go through a process of relearning. The ones who succeed are the ones who save their money during the good times so that they can financially survive the lean periods.
9. The market you’re in counts as much toward performance as your trading method – Some markets are more volatile and trendy than others; some have more distinct patterns than others. Finding the right fit between trader, trading method, and market is key.
10. Execution and trade management count – A surprising degree of long-term trading success comes from getting good prices on entry and exit. The single best predictor of trading failure is when the average P/L of losing trades exceeds the average P/L of winners.
Well, I’ve already hit ten and I have at least ten more I could jot down. Number 11 would be that successful performance mentors have content expertise in their particular domain. What I mean by that is that teachers of concert musicians themselves have experience as musicians; basketball coaches invariably have played the sport themselves. You learn trading by seeing your mentor trade and by having your mentor observe your trading. The right mentorship goes a long way toward shortening learning curves.
Figure it out: what proportion of baseball players, golfers, actresses, chess players, singers, or bicyclists can make a consistent living from their performance activities? Is trading really so much easier than those activities? The stark reality is that expertise in any performance field is the exception, not the rule, requiring dedicated practice and training. If you are emotionally prepared for the learning curve—and excited by the challenge—you are well ahead of the game. Start with finding the Three M’s: right methods, markets, and mentors. Those are the foundation of success, upon which you build skills and experience. Enjoy the journey!
Good stuff here by Brett Steenberger.
I think he gets to some core issues....
http://www.traderslog.com/steenbarger.htm
1. Trading affects psychology as much as psychology affects trading – This was really the motivating factor behind my writing the new book. Many traders experience stress and frustration because they are trading poorly and lack a true edge in the marketplace. Working on your emotions will be of limited help if you are putting your money at risk and don’t truly have an edge.
2. Emotional disruption is present even among the most successful traders – A trading method that produces 60% winners will experience four consecutive losses 2-3% of the time and as much time in flat performance as in an uptrending P/L curve. Strings of events (including losers) occur more often by chance than traders are prepared for.
3. Winning disrupts the trader’s emotions as much as losing – We are disrupted when we experience events outside our expectation. The method that is 60% accurate will experience four consecutive winners about 13% of the time. Traders are just as susceptible to overconfidence during profitable runs as underconfidence during strings of losers.
4. Size kills – The surest path toward emotional damage is to trade size that is too large for one’s portfolio. We experience P/L in relation to our portfolio value. When we trade too large, we create exaggerated swings of winning and losing, which in turn create exaggerated emotional swings.
5. Training is the path to expertise – Think of every performance field out there—sports, music, chess, acting—and you will find that practice builds skills. Trading, in some ways, is harder than other performance fields because there are no college teams or minor leagues for development. From day one, we’re up against the pros. Without training and practice, we will lack the skills to survive such competition.
6. Successful traders possess rich mental maps - All successful trading boils down to pattern recognition and the development of mental maps that help us translate our perceptions of patterns into concrete trading behaviors. Without such mental maps, traders become lost in complexity.
7. Markets change – Patterns of volatility and trending are always shifting, and they change across multiple time frames. Because of this, no single trading method will be successful across the board for a given market. The successful trader not only masters markets, but masters the changes in those markets.
8. Even the best traders have periods of drawdown – As markets change, the best traders go through a process of relearning. The ones who succeed are the ones who save their money during the good times so that they can financially survive the lean periods.
9. The market you’re in counts as much toward performance as your trading method – Some markets are more volatile and trendy than others; some have more distinct patterns than others. Finding the right fit between trader, trading method, and market is key.
10. Execution and trade management count – A surprising degree of long-term trading success comes from getting good prices on entry and exit. The single best predictor of trading failure is when the average P/L of losing trades exceeds the average P/L of winners.
Well, I’ve already hit ten and I have at least ten more I could jot down. Number 11 would be that successful performance mentors have content expertise in their particular domain. What I mean by that is that teachers of concert musicians themselves have experience as musicians; basketball coaches invariably have played the sport themselves. You learn trading by seeing your mentor trade and by having your mentor observe your trading. The right mentorship goes a long way toward shortening learning curves.
Figure it out: what proportion of baseball players, golfers, actresses, chess players, singers, or bicyclists can make a consistent living from their performance activities? Is trading really so much easier than those activities? The stark reality is that expertise in any performance field is the exception, not the rule, requiring dedicated practice and training. If you are emotionally prepared for the learning curve—and excited by the challenge—you are well ahead of the game. Start with finding the Three M’s: right methods, markets, and mentors. Those are the foundation of success, upon which you build skills and experience. Enjoy the journey!
For day trading. Find the time frame that suits your style and personality, trade the direction of the trend, only put on a trade once the conditions for a trade has been met, do not try to be in every trade and most of all PATIENCE when you are in and when you are out. When you miss a trade, remember that there will always be another trade - you won't know when, but trust that it will come. Like someone mentioned in this thread: Rather be out of the market and wish you were in, than be in the market and wish you were out.
MAmijee232
Junior member
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Good advice there mikemike!
I also like to add, remember that the market adapts and evolves. Always keep up! A factor that doesnt impact the markets today, doesnt mean it will not impact the market tommorow! Try to get a 'bigger picture'. Also remember that politics plays a big role in the financial markets
If this hasnt been said before, there isnt a 'holy grail' method out there that carries no risk. The key is to manage your risk and preserve your capital. Define a strategy that works for you
I also like to add, remember that the market adapts and evolves. Always keep up! A factor that doesnt impact the markets today, doesnt mean it will not impact the market tommorow! Try to get a 'bigger picture'. Also remember that politics plays a big role in the financial markets
If this hasnt been said before, there isnt a 'holy grail' method out there that carries no risk. The key is to manage your risk and preserve your capital. Define a strategy that works for you
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How to Limit the Damage of a Losing Trade...
The following 3 steps explain how to limit the damage of a losing trade:
1) Accept without reservation the reality that "No matter how good a trade looks, it can turn into a loser".
2) Predefine the risk of EVERY trade by establishing a maximum amount that you are willing to lose on it.
3) Honor your predefined risk when it is reached. Do not rationalize, hesitate, justify or hope. Close the trade. There is always another trade just around the corner.
These three steps will help you avoid the common trading error of letting a small loss turn into a big loss.
They will preserve your capital and enable you to return to trade another day.
The following 3 steps explain how to limit the damage of a losing trade:
1) Accept without reservation the reality that "No matter how good a trade looks, it can turn into a loser".
2) Predefine the risk of EVERY trade by establishing a maximum amount that you are willing to lose on it.
3) Honor your predefined risk when it is reached. Do not rationalize, hesitate, justify or hope. Close the trade. There is always another trade just around the corner.
These three steps will help you avoid the common trading error of letting a small loss turn into a big loss.
They will preserve your capital and enable you to return to trade another day.
