What are the most valuable lessons you have learned?

HuntingBenjamins said:
I haven’t been doing this long but with each trade I try to pick up knowledge along the way. If you-today could go back and tell you-that-just-started-trading something that you’ve learned along the way and would make your life way easier back when you started, what would it be? (Not talking about a stock that you now know took off…talking about skill-set)
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1. Daytrading is a mug’s game. You make far more money with far less stress by focusing on multi-week, -month and -year trends or themes.

2. Profits don’t scale with activity. It’s far better to focus on identifying the top 5% of opportunities and acquire the skills and guts to really pile on the size and risk, plus the patience to wait for them.

Taking the above principles to an extreme… a buddy of mine worked for TSLA from 2011 to 2021, got a bunch of stock options, and in one single “trade” exceeded my lifetime grinding-it-out profits by a large margin.
 
HuntingBenjamins said:
Good point here. It is VERY addicting. I’ve got 3 trades going right now and once they are closed out I plan on taking a cool-down break.

So far I’ve got 33 wins and 4 losses. 2 of those losses I simply stayed in them too long. The other two were big time rookie mistakes. In fact one of the bigger losses was a lot of different mistakes rolled into one that I won’t be repeating. Both recovered fully after I got out of them. Knowing what I know now those losses wouldn’t have happened. I’ve got a better plan for dealing with those scenarios in the future.
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I am not going to try to discourage you but to get consistently profitable is a tough road. It's a journey through hell that will put you at the brink of insanity.

I wish that I paper traded a lot more before I put my own money at risk. You have to use your natural talents and gifts to create a strategy and test it on every single timeframe, every single chart, and market condition(s) and make sure that your strategy holds up everywhere. If it fails under any condition then you have to tweak it and re-test it. Then you should go back and paper trade that strategy against different market conditions and to make sure that you have the cajones to execute that strategy when push comes to shove. I felt prepared to trade September - November of 2022 because I went back and practiced paper trading the fall of 2018 correction until I could get it right.

And then if all of that by itself isn't enough you need to figure out how the entire market and financial system is structured and make sure that the major sources of liquidity have your back.
 
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Laissez Faire said:
If I were to start all over again I would have focused on strictly investing and low leverage swing trading while focusing on increasing my income through a job or some other business where I would fuel the excess into investments and swing trades managed part time. The returns may be less stellar than most starry eyed would-be-traders fantasize about, but they should be more consistent and more easily achievable.
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@Laissez Faire never say never. It is never too late.

But I bet you are doing fine all these years or you won't be here.

Take care.
 
SunTrader said:
Famous last words.

If it sounds like I am dumping on you "been there, done that". Most have.

As for high win percentage. For the most part it is misleading at best and meaningless at worst. False sense of security that the ego eats up.

Return/risked percentage is what matters, over the long haul. What you keep.
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Well what I meant by that is someone said a sentence in here that has stuck very well: “The only reason I took a big loss is I didn’t take the little loss.” Those words are now etched on my brain. It was a huge mistake for me to let it ride as long as I did. Even though the two that got me good recovered (without me riding them) there was no promise that they were going to (even though I suspected they would eventually and was right about that). If presented with the situation again, I’d do a tighter stoploss and if they happened to recover I could pick them up again on the way up. But had they not recovered, the loss would have been way less than what I took. That’s the newly absorbed plan and I’ll tweak it over time.
 
HuntingBenjamins said:
... I’d do a tighter stoploss and if they happened to recover I could pick them up again on the way up. But had they not recovered, the loss would have been way less than what I took...
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Ok, that's the correct way to think about.

Although not necessarily a tighter stop that it gets hit too soon.

Here is an example from yesterday afternoon of the Micro NQ 1 minute chart:

! MNQ.png

Say you entered after a break of previous high, bar with green arrow on top and set stop to be triggered on break of any succeeding bar's low - which happened on next bar (red arrow). Losing right before it moved higher.

Use price action to determine stop placement, and so this case stop it should be set a tick or two below swing low 3 bars to the left. Then as higher highs are made trail behind each one or two bar low till exit.
 
deaddog said:
Now that is hard to do and for the following reason:

When you die, you are dead, you don't know you are dead and don't feel any pain.

It's the people that care about you and the people that you know that feel the pain and suffer.

It's the same when your stupid!!!
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Hello deaddog,

Doesn't matter who suffers, big losses leads to losing money and living in drawdown and being an loser trader overall and poor if trader can not making a living doing other things for money. My thinking and writing is only my opinion. LOL, had to write the disclaimer for the great debaters on ET.
 
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SimpleMeLike said:
Hello deaddog,

Doesn't matter who suffers, stupid trading and big losses leads to losing money and living in drawdown and being an loser trader overall.

No more greater pain the losing money consistently for years and years.
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Hey SML

I know that so I make a point of not doing that.

I keep telling wannabe traders to figure out what causes you to lose money and then stop doing that stuff.

Sound stupid but it works!!
 
deaddog said:
Hey SML

I know that so I make a point of not doing that.

I keep telling wannabe traders to figure out what causes you to lose money and then stop doing that stuff.

Sound stupid but it works!!
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Hello deaddog,

I agree with you 1000% on this.

It is really great advice actual. Its not about the winning, its about the losing.

I personally do not care much about the winning side of the trading. I only care about reducing the losses and not doing things that causes big losses.

Really good advice.
 
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