I'm wasting my time?

C

cashmoney69

I bought the book "Trading in the zone" and I like it, but there are some things that I want to ask.

page 35

" The consistency you seek is in your mind, not in the markets. Its attitudes about being wrong, losing money, and the tendency to become reckless, when you're feeling good that causes most losses--not technique or market knowledge "

same page

"Attitude produces better overall results that analysis or technique, because if you have the right attitude, then everything else about trading will be relatively easy, even simple and a lot more fun"



My attitude never changes when I'm trading. I stay calm "neutral", so why am I not consistently profitable? sense after all, according to the author, reading charts, finding patterns, understanding how economic factors affect the market is obviously not as important

- nathan
 
Its not enough to be calm during trading. Do you have an edge?

I could be calm in front of a slot machine and drop quarters all day long, doesn't mean I am going to make any money.

An edge is the higher probability of one thing happening over another.

Speaking of egdes I need to get back to mine, busting my ass for 10 + hours a day starting up a landscaping company, so eventually I won't have to bust my ass for 10 + hours a day.
 
Page 135 - "An edge is nothing more than an indication of a higher probability of one thing happening over another."

If you are in "the zone", and still losing money, then you truly have no edge.
 
I think what he means is: having a "correct" attitude is like having good risk management -- without it, no edge can be successfully exploited. But you must first have an edge.

In regards to remaining calm about losses, emotional imbalances only arise if you have some reason to expect to win. In other words, it's alot easier to remain calm while continuously losing at the roulette wheel or feeding coins in a slot machine, but it's a hell of alot harder to keep your cool if some 12-yr old kid keeps kicking your ass in say chess or basketball. It's the (excessive) expectation for success that's the source of many "attitude" problems traders have, at least imo.
 
"Attitude produces better overall results that analysis or technique, because if you have the right attitude, then everything else about trading will be relatively easy, even simple and a lot more fun"
More...

This is complete garbage. Attitude cannot produce any results on it own. Analysis/technique is required to find an edge. Then you need the attitude/emotional control to strictly follow your rules.

An edge does not guarantee success, if you cant execute it, but attitude aint shit without edge.
 
Quote from illiquid:

I think what he means is: having a "correct" attitude is like having good risk management -- without it, no edge can be successfully exploited. But you must first have an edge.

In regards to remaining calm about losses, emotional imbalances only arise if you have some reason to expect to win. In other words, it's alot easier to remain calm while continuously losing at the roulette wheel or feeding coins in a slot machine, but it's a hell of alot harder to keep your cool if some 12-yr old kid keeps kicking your ass in say chess or basketball. It's the (excessive) expectation for success that's the source of many "attitude" problems traders have, at least imo.
More...

Great analogy~~!
 
Quote from illiquid:

...
In regards to remaining calm about losses, emotional imbalances only arise if you have some reason to expect to win. In other words, it's alot easier to remain calm while continuously losing at the roulette wheel or feeding coins in a slot machine, but it's a hell of alot harder to keep your cool if some 12-yr old kid keeps kicking your ass in say chess or basketball. It's the (excessive) expectation for success that's the source of many "attitude" problems traders have, at least imo.
More...

BS. Before you pull the trigger you expect to win; not to lose or b/e. It is an edge that gives you the confidence to expect to win. Any other expectation is just second guessing your edge, which suggests a completely different problem.

As for gambling, you remain calm because you know before you pull the handle that the edge lies with the house. There is nothing to lose emotionally. Any expectation or confidence for winning is purely self created.

As for competition against say a 12 year old, all I can say is what is your edge? What gives you confidence to expect to win, hence the difficulty to remain calm? Judging a book by its cover is not an edge.

But alas, an edge does not guarantee a win. In gambling, once the bet is made and the game begins there is win or lose. In trading you have opportunity to re-strategize, which can be used to further enhance, refine, or refute the original edge, further increasing confidence and expectation to win.
 
Relax. I didn't say in order to win, you can't expect to win.

I meant that first you will need to expect to win (ie, think you have an edge, whether true or not), before you can actually see if you can remain "levelheaded" through adversity. Hubris, trading never to lose, revenge trading etc all stem from expectations form the initial and incomplete understanding of one's edge.

As for 12-yr olds, if you can't grasp the gist of what I wrote and just like to argue for argument's sake, a big *shrug* to you.
 
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