Trading for Morons - tips, pros cons etc.
- Thread starter JII
- Start date
BALLS
BRAINS
CHARISMA
BRAINS
CHARISMA
I'll take those first two, but trade the charisma for discipline or quickness.
Never stop learning and observing. It never ends. It's what you have to do to be successful.
You must also have an open mind, realize when you are wrong, and understand that anything can happen.
You must have an edge in every area, from the computer you use, data service, data feeds, software platform, the broker you use, oh yeah, and your strategy.
You have to have the best of everything around you. Then you can go to work in the marketplace. But, make sure that you have an edge.
Always remember to get out of your positions when you can and not when you have to. You must always be in control of yourself.
Those are just a few things that come to mind.
If you're really just getting started, I'd stress your need for a highly successful mentor. 'Trading software' or some online guru isn't good enough. You need your mentor to teach you what to do, watch how you're trading, and correct your mistakes while explaining what you're doing wrong.
Otherwise....well, 90%+ fail at this for a reason...
Otherwise....well, 90%+ fail at this for a reason...
I don't recall many market wizards having any trading mentors if at all. I am referring to Jack Schwagger's books. Not all of them were successful at first too. In fact some were total failures. If you really cannot figure out what you are doing wrong then you are too dumb to trade in the first place and you won't get much help from your mentor. Most people do know what mistakes they make, the problem is they are not capable of avoiding them because this requires some self-discipline which is the hardest thing to get.
My advise: papertrade for as long as it takes, then try small positions and learn from your own mistakes. A mentor is no guarantee of success and can cost you more than your own experiences. Still a trully good dedicated mentor is not bad and can speed your learning process, but beware of those who are in the mentoring business because they failed as traders.
90% fail because they lack a trading plan, the discipline in executing it and cannot perservere long enough until they become profitable.
Okay I know it is commonly accepted as good advice to have a mentor. I can see that there is some benefit to having someone show you what works for them.... more precisely, why what they do works. However, unless what the mentor does is 100% mechanical, it still must be learned from experience. Experiencing why he would take the trade this time, why not the next time.
While experience is the best teacher, the chart is the best tool. With online charting so cheap, and the methods of using charts so readily available, there is no excuse for a new trader not to view a bazillion charts.
I think the best advice is find no more than three indicators that you like, and look at a bazillion charts with them. Look at every major time frame. Heck there are only 500 stocks in the SP500 so start there. And then go back and scroll forward. Watch what happens. And watch real time. Read everything you can find about your favorite indicators.
The so called Market Wizards are highly overrated.
Richard Dennis and his little reptillian friends couldn't trade their way out of a paper bag.
I'm not saying it's impossible to find your own path without a qualified mentor, it just lowers your odds quite a bit.