Mark Douglas

[TSGannGalt]

Quote from markd85:

Thanks Guys
My local bookstore only had The Disciplined Trader so I picked it up and so far it's really good. I never realized how important the right mindset is to trading.
Mark

I'd just like to remind you that, you shouldn't be making conclusions.

It's just one way of approaching the market, and not all of it. It's just part of what makes a good trader, for some of the people.

I've met guys who don't give a damn about trader psychology (and equally opposite of what Douglas, Tharp, or others mention) who makes a great deal of money. Eventually, you can't be a saint.

Just be a bit flexible. All this psychology stuff is very subjective, not definite. It's good to know that not.

This is not a balance issue.

 

[rjv27]

Quote from markd85:

Hi Traders
I've heard so many good things about the Mark Douglas books that I'm going to buy one this weekend. Would it be necessary to read both or will the last one (Trading in the Zone) do the job of straightening out my clouded mind? Thanks for your opinions.
Mark

I read "Trading in the Zone" after I was trading for 6 mons. I have been profitable ever since. I think understanding Psychology has helped me 60%, risk management 20%, and my method 20%.

 

[CharlesTrader]

I keep a copy of this on my desk, and read it out-loud before the market opens. It's my way of shifting gears, leaving other aspects of life behind, and mentally preparing myself for the trading day:

The Disciplined Trader

STAY FOCUSED ON WHAT YOU NEED TO LEARN

Focus on Market Structure rather than money.

There is nothing worse than missing a “Perfect” opportunity; however, there really isn’t anything to miss as long as price keeps changing, there will always be another opportunity.

DEALING WITH LOSSES

Predefine what a loss is in every potential trade

Execute your losing trades immediately upon perception that they exist.

BECOME AN EXPERT AT JUST ONE MARKET BEHAVIOR

Let other opportunities pass.

Release anxiety to trade too often

Eliminate the psychological damage of fear. The trader’s past mistakes will generate so much fear that he won’t be able to execute his trades properly or at all.

Perception and execution of opportunities are separate skills. They can and do work in tandem if there are no mental components blocking execution.

LEARN HOW TO EXECUTE A TRADING SYSTEM FLAWLESSLY

There is no guaranteed income in trading.

Patterns that repeated in the past may not repeat in the future.

Even though all systems have a percentage of losers, do not try to outguess your trading system.


THINK IN PROBABILITIES

“You will want to determine the prevalent beliefs being expressed in the market and how those beliefs will affect price movement. That identification process requires a detached objective perspective, where you are watching and listening to what the market is telling you, instead of being focused on what the market is doing to you personally.”

BE OBJECTIVE

You feel no pressure to do anything, and have no feeling of fear.

You recognize what the market is telling you, and this is what you need to do.

You are not focused on money but on the structure of the market.

MONITOR YOURSELF

Monitor yourself by knowing what you are thinking about and what market information you are focused on.


Charles

 

[4re]

Quote from markd85:

Thanks Guys
My local bookstore only had The Disciplined Trader so I picked it up and so far it's really good. I never realized how important the right mindset is to trading.
Mark

It is a great book, like I said earlier once you get to chapters 15 and 16. Read them several times until it just clicks with you. You will come away a better trader. I actually typed those 2 chapters and carry that document with me in my briefcase. I read those 2 chapters all thime to keep me focused. It also keeps my trading very simple.

Good Reading To You,
4re

 

[Batterup]

tsganngalt

I am a little perplexed why you would say some psychology is not as useful as many claim. Discipline in any field is a major factor in anyones career, be it a trader or a bricklayer. A bricklayer learns a trade and basically uses the same techniques over and over for many years. Traders, investors etc on the other hand are dealing with a game of probabilities and are constantly making decisions with inaccurate, incomplete, improbable, etc inputs. Since these inputs lead to constant errors in judgement, timing, decisions etc ....the average person must adjust the game by controlling the emotions which are part and parcel of all the mistakes and losses.

Being able to control ones psych is not an easy task when bombarded with false hope and wishful thinking. Emotions are the number ONE trader killer out there. 95% of the losers are not morons, many were very successful in other fields and or trades. WHY do 95% of trader wannabe lose?

Mark Douglas and others are trying to help others in this very difficult game. There is an old saying out there: LEARN FROM THOSE THAT WERE SUCCESSFUL.

Personally i own and read Marks books and highly recommend them. I never went to a professional on my own to even out the swings in days past, my training was from the loss column, i do not like pain so with losses i had to sit down and find out why. I am glad the days are past where most of the losses that occurred after a good understanding of Technical analysis and "mkt sense" were almost 100% psychological mistakes rather than mkt mistakes from poor judgement, etc. We all make mistakes from poor judgement even later in the trading career, but i venture to say these were stupid psych errors where we let ourselfs down and not where the mkt let us down.

PSYCH is the most important part of trading once one learns the mkts mechanics and the proper signals etc to play.

Many of us are sitting at home in front of a screen playing the trading game, psych still matters. I would love to trade with a pair of sunglasses on so not to "TELL" the mkt about my emotions like a poker player at a table. that might work in poker, but in trading the only person that can control my mind is me, the mkt has no control over me at all.

PSYCH is real in all human beings, it is magnified a thousand times the second a trade shows a tick loss.

Thank You......Not trying to rattle any cages here, just trying to help.............


PS: The Disciplined Trader readed that and have it sitting by the can, great time to pick up and review a paragraph at a time. ...

 

[JMowery1987]

Trading in the Zone changed me... I don't know how, I don't think it even tought me anything I was supposed to already know.

But the book did explain it in a way to better bring it to my attention and with examples and such, it just finally gave me that "click" in my mind that understood what I was finally supposed to do, along with the help of some good traders on ET, and reading that book, it changed the way I traded and have since then had confidence to execute and be able to trade well.

 

[volente_00]

I own both books. TITZ did not seem very beneficial to me, but
The Disciplined Trader is one that had a positive influence on my trading. The most important concept in it to me is that you must first learn how to lose before you can win and that you will never make it in trading using scared money.

 

[TSGannGalt]

Quote from Batterup:

tsganngalt

I am a little perplexed why you would say some psychology is not as useful as many claim.

Thank You......Not trying to rattle any cages here, just trying to help.............


PS: The Disciplined Trader readed that and have it sitting by the can, great time to pick up and review a paragraph at a time. ...

Well...

Look at this way. Let's say you have a strategy or trading style that doesn't work. You may be psychologically "optimal" towards trading, but you would eventually lose in the long run... As an example, Try making a living as a professional gambler in a casino. You wouldn't be doing it if there is no edge, you wouldn't just go into a casino playing under their edge and expect to make a living out of it.

Now, there's an issue about identifying a profitable strategy. In my opinion, again... OPINION, it comes from knowledge and experience. Are knowledge and experience, psychological aspects??? Rather debatable but my OPINION is, it's not psychological.

....

Re-mentioning what I've written above, it's not all of what makes a trader profitable. It's just part of it and blindly concluding that trading is psychological is immature.

Personally, I've also gone through all of what is mentioned here. I bought all of Van Tharp's courses that was available back then, read Mark Douglass' books, gone through psycho-analysis books like Freud, Lacan, Derrida, Jung and NLP material. Eventually, it really didn't do much help as a trader.

It was good to know as an individual but eventually you trade the market. Even with all the materials I've gone through, it didn't change who I was. Studying the market and actually trading them was what eventually made me profitable.

Though, one good thing about all these "psychological material" is that you can look back at these and say "This is where I am at..." or "Ahhh... this is what xxxxx was talking about...". Eventually, you have to reach that point to actually relate to the material. Simply, a qualia issue. (You may know how a apple tastes like but you have to eat it to "really know" how it tastes)

One question I can give is:

Aren't you looking for what works in the market, rather than learning about the market?

 

[CharlesTrader]

Quote from TSGannGalt:



. Studying the market and actually trading them was what eventually made me profitable.

What's funny here is that this is what Mark Douglas is suggesting in his book(s). Focus on the market, study the market and trade what the market is telling you.

Charles

 

[TSGannGalt]

Quote from CharlesTrader:

What's funny here is that this is what Mark Douglas is suggesting in his book(s). Focus on the market, study the market and trade what the market is telling you.

Charles

I'm sure it's funny. But who's laughing?