I may officially retract some of my previous statements concerning you WmWaster, but only if you clarify how you see yourself fitting into the above quote. Who are you on this list? I myself would have to claim Intermediate for the channeling of my psychological emotions. As well as both Intermediate and Expert as pertaining to the education from mine and others' lessons.
I'm glad you become calm again, 2manywhiners!
I usually leave the person alone when it is furious. It's the best to both parties. Only time can cure one's emotions. Only if it's calm will I come back and explain since only calm people will open their ears.
I'm glad to answer your questions from now on since I know you will listen now.
First what's the use of a
complete simulated trading. It's to:
- help testing your trading methods/rules/systems
- help testing your money management & position sizing
- be familiar with your trading software and execution procedures (it's more important if you intraday)
- be familiar with your decision making procedures & reaction (it's more important if you intraday)
- simulate your psychology (
the hidden values!!)
Now ignore what I say about psychology first. Do you agree the above criteria are important as a successful winner and simulated trading can help you achieve all of them (except psychology)?
If so, there's no reason why you need skip the step of simulated trading, no matter your status about psychology.
So the next question is whether a successful
simulated trading guarantee a successful
live trading. That's the distinction between intermediates and experts. An intermediate has to go through live trading, learn from their mistakes, and grow up. It's nothing wrong but you need to spend more bucks before you win. An expert can avoid these unnecessary costs.
An intermediate who needs to learn from live trading will somewhat follow the following stages:
- They get the key towards success. They "understand" the danger of emotional trading.
- However, instead of following their plans strictly, they involve in emotional trading as their start. They keep losing but they don't know what's wrong. Their emotions are getting stronger and stronger.
- After enough real losses, they get too many pains. They sit down and ponder on their failure. They know how to win, but they couldn't. Why?
- They realize it's their emotions which make them lose. What should they do now? They can't keep going on like that or they will be eliminated finally.
- They stand up, swear and determine that they will never let their emotions screw their well-thought plans up anymore. They get out of emotional trading WITH NO EXCEPTION
- They stick with their well-thought plans religiously ALL THE TME. They win at last.
Don't you feel what they do is similar to the following case?
People have told you already the danger of smoking. You know it. But you smoke out of curiosity when you first encounter a cigarette. You seriously affect by smoking and your health declines. You now sit down and realize how stupid you are to smoke. You swear and determine you can't smoke anymore or you will get all sorts of illnesses like lung cancer. You get rid of this habit and become healthy & refreshing again at last.
Emotions are like "smoking" in trading. If you follow your emotions, you are destined to lose. Following your plans strictly is what you need to do. That's simple! There's nothing more you need to do.
An expert will simply do the following:
- They get the key towards success. They understand the danger of emotional trading.
- They stick with their well-thought plans religiously ALL THE TME. They win at last.
They have spent enough time to prove the validity of their trading system. They know they can simply succeed as long as they stick with their plans. They know more than enough how bad emotions are. No hesitation! No worry! No greed! They don't need to see how their emotions spoil their trades before they grow up. They won't "smoke" when they're trading.
If you compare between the 2 stories, you will see what intermediates and experts do are exactly the same, except that intermediates do more - the italic part. They just need walk through the wrong way before they know where to go.
As far as being right or wrong, each side has its merits. But the main idea is that being prepared is, by leaps and bounds, more important than having simulation experience. Many traders have Live trading experience. Most traders are not profitable. Having Live or Sim experience does not make you prepared. This is of course all connected, and I want to point out to the beginners that either path you choose has significant consequences for being unprepared.
You may try to think in this way:
Most traders are losers, so does it mean trading is not profitable? No, definitely not. One can consistently win in long run. Trading can be its full-time job too.
The same applies to simulate trading. Some people may regard it useless or not helpful, so does it mean it is useless / not helpful? No, definitely not. Most new traders lose when they first trade, so does it mean new traders must lose? No, definitely not.
Why do people lose even if they have sim trade? That's easy. You may ask similar questions for other things too. Why do I lose even if I have a trading plan with me? Yes, you lose because your trading plan suxks! The same applies to your sim trading. Your sim trade suxks! That's why you can't get full benefits from sim trade. People commit all sorts of mistakes when they sim trade. No wonder they will lose when they trade live. You can win
only if you know how to sim trading and so get useful sim trading experiences, NOT if you just sim trade, no matter how you do your sim trade.
As to how to sim trade correctly, I have explained all these in my previous posts. so do yourself a favor and read back.
PS Thank you New Traders, and Inquiring Ones, for the PMs. Keep them coming. Like I've said before, I don't push a narrow minded approach. I'm not selling a thing. I'm here to help, so don't be shy.
Don't you think we are doing all the same?
Do you think we get paid for these posts?
Last but not least, I think this question is most concerned by you. "
Did you gain just after your sim trading?" I'm reluctant to answer because I know you cannot gain by a straightforward answer. I wish you can understand and judge based on the descriptions, reasons & explanations I offer, not just a simple answer. You can't learn from it. You might even fail since you have no faith/understanding on it. It's like you'll probably screw things up if I just give you the secrets of trading straight away. If you see & understand
my way of sim trading will lead you to success, you will follow religiously and follow successfully.
But I think you wish to know now because you can't judge based on my explanations, or you need some confirmations. Then I can tell you: "Yes, it's what I did, and how I succeeded for the very first time I trade with my first trading methods! New traders, you could do the same as long as you know how to
sim trading in my way!"
If you have any question, feel free to ask.
Best regards!
