“When I was 20 to 25 years younger, every move in the
markets would make me excited. By the mid-90s, I got my emotions under control.
I learned to focus on eliminating risk on the front end, so that I would have
fewer problems on the back end.” –
David J. Merkel
Mr. Liam* was attracted to a trading strategy software as it
was being pitched. The 2-year historical results were amazing, as shown by the
vendor of the software. The results showed a historical hit rate of 70%, but
the software was very expensive. In order to purchase the software, Mr. Liam
had to pay in 4 installments. After that, he was able to get the software.
However, Liam lost money with the strategy, and he got the
vendor arrested.
Because Liam was a good reader – reading many trading
article and magazines – he discovered that there were successful traders. Since
he was inspired by testimonies from super traders, he continued working to
improve his knowledge.
When he attained some level of competence, he put the
strategy to test again and saw that the strategy was wonderful. He realized
that he himself, not that strategy, was responsible for his loss. He felt sorry
for the strategy vendor, and as a result of that, he visited the vendor and
tendered his heartfelt apology. He even gave the vendor a cash gift of $1000.
A great strategy can’t work for a suicide trader.
The Power of Choice
Anyone who says she/he can never lose is an accomplished
fabricator. Anyone who says their strategy doesn’t lose is also a distinguished
fabricator. Losses are a blessing in disguise because they’re the secrets that
help us become better traders. When you lose money with a good strategy, after
being faithful to it, it’s up to you to decide whether to quit or
continue.
There was a legendary trader who made and lost fortunes in
the markets. We got much to learn from such a great trader, so that we know what’s
behind his success and imitate him. We also want to know the cause of his
failure so that we can avoid that in our trading. The truth about trading is
timeless and it will forever be. Humans drive the markets, and as such, various
human emotions are reflected in price actions. When things go wrong, we want to
make sure that the effects on our portfolios are minimal.
Successful traders lost in the past. Yet, they continued
until they reached a stage where they start making money effortlessly. When
they were losing, some people tried to discourage them, thinking they’d their
best interest in heart. If you allowed yourself to be discouraged because of
the current fleeting losing streak, in future, you’ll only be green with envy
when you hear how much successful traders are being paid.
Super stars, celebrities, politicians, athletes, etc.; have
always faced ignominious defeats now and then in their careers. Greatest role
models accepted defeats in the past, but they moved on. Greatest role models
accept defeats today, and they move on. Their transitory failures were the
secrets of the enviable breakthroughs they enjoyed later.
Check the stories of very great people in various walks of
life, past and present. You’ll understand what I’m talking about.
Super traders today refused to be discouraged when things
were tough, when their friends and folks were asking them to try another “safe”
ways to earn livelihood. The other “safe” alternatives that many members of the
public prefer to trading are the major reason why more and more members of the
public are getting poorer and poorer. Those who allowed themselves to be
discouraged paid a heavy price for their short-sightedness.
The Inevitable
Experiences
It’s easy to criticize others while we’re being blinded to our
imperfection. Everyone thinks they’re right, until the markets prove them
wrong. We’ll do ourselves great favor by focusing on our own weaknesses and
working on them: instead of focusing on other people’s weaknesses.
All traders will experience negativity. You can continue to
experience negativity, irrespective of what you do, until you start asking
what’s really wrong with your life. At this stage, you’ll doubt your
possibility of becoming a profitable market speculator. Yes, all traders
experience negativity, and sadly, that’s the stage where most others quit. No
wonder then that few people can share testimonies to the possibility of
everlasting success in the markets.
Very few traders move beyond the stage where they lose, no
matter what they do. Indeed, very few people will rise up and continuing
struggling again, after they’ve been floored by the markets. You must master yourself before you master
the markets. Bad trading results are an evidence of personality flaws in you
and good trading results are evidence that you’ve controlled those flaws.
The few people who rise up to struggle again will inevitably
reach a stage when they start making money effortlessly and consistently. These
are the people that the public call “market wizards,” “super traders,” “pros,”
“expert speculators,” “gurus,” “witches,” “mad geniuses,” etc. The public think
something is special about them, but these people know that there’s nothing
special about them. They’re consistently
profitable because of their many years of experiences, plus their winning
speculation principles have been practiced again and again until they become
their second nature. You think they’re smarter, more brilliant, more fortunate,
more intelligent, and more innovative. Nevertheless, they think they’re not
better than you. What makes the difference is that they decided to continue
fighting for success at the stage that most others quit.
We’re given the power
of choice to use for future glory or future regret. Even if we’ve
challenges in the markets, why can’t we seek help from professional traders and
coaches? If you got a persistent toothache, you go to a dentist. Then why not
seek help from a trading professional when you’ve a challenge?
The quote below ends this article:
“You also need to be able to trade a setup even when it
is profitable. By that I mean that you need to stick to it throughout all the
ups and downs. After all, it takes several tries with some setups for the trade
to work. Until it does, you must be able to continue trading with confidence.” – Ruediger Born
*His name has been changed.
Source: www.tallinex.com
Learn from the Generals of the Markets: Market Generals
No comments:
Post a Comment