Sugar Baby ?
What do you think matters most in trading?
- Thread starter ninZa.co
- Start date
Age doesn't matter at all. Some people start only when they are 40.
The time you need to figure it out counts. And even that is not the best answer. After more than 20 years of trading I found a system that was beating the performance of what I had till then by a manifold. So while I thought that after so many years I figured it out, it appeared that the maximal potential was still not reached.
If you make 50% a year, does this proof that you figured it out?
What if you make 50% a month, does this proof that you figured it out?
What if you make 10% a day, does this proof that you figured it out?
At what performance exactly did you figure it out? To me it is a never ending story as long as you continue trying to improve your system. You never know where the limits are. You will see it in hindsight, the day you die, as from then on you cannot get better anymore;
I was sure I was close to the limits 2 years ago. Boy was I wrong about that...
There is no 'according to' because so few make any real profits, I make 20%, then the question is '20% what', that depends on the timeframe, some will make 10%, some 5%, some 2%, some 1%, but 20% is kind of the upper limit.
For example retail make 1% per quarter in their accounts, only when you combine both time and value do you have a gauge of how good there are at what they do, 1% per month which is the benchmark for almost all traders which is in the lower 20%
As society 'progresses' the limits are pushed higher, however most have low standards as to what the limit is at that point in time, I have no doubt the upper limit can be '50%' in due course but that is not today, maybe in a few years depending on where the world goes from here.
Last edited:
Don't be smarmy. The generally-accepted gauge is per annum of your liquidating value.
Ergo, your cash in the account.
Like the song says, "If you don't know that by now, you will never ever know"
In my opinion these are what matter the most in trading.
1. This is by far the most important. Having enough personal financial security that you do not need to be profitable to pay the bills. You have to be relaxed and be financially able to take the losses that will come.
2. This is almost as important and it is very difficult to do. Have no trading day directional bias for the market you are trading. That means ignore the daily charts, government reports and all news. Obviously know when the Fed is making its 2 PM announcement so you do not go into it with a position on the books.
3. This is an extension to point 2, but avoid developing a directional bias within the trading day. This happened to me on Friday: With the strong early up-move I formed a bias that it was going to be a strong up day and traded with a bullish bias for a bit before I realized what my mind was doing to me.
4. Obviously you do form a Position directional bias the second you enter a trade. Keep the words of Mark Douglass close at heart: "Once you enter a trade anything can happen" You have your edge but it is not 100%. It is important not to let "Position Bias" close your mind and cause you to wait too long to take your loss.
5. Even though I have this listed last it is probably the most important to me as I have to fight this constantly. Never ever ever ever, average down. The tragic thing is that this rule can be violated successfully most of the time. As you keep lowering your average cost it takes less of an up-move to break even. And with the volatility in the market you usually get a reaction large enough to get out even. But this causes you to miss the profit in the move and probably the next one in the opposite direction as well. Plus that one time when the market cascades against your HUGE position: Well, it can blow your month, year, or even your entire account.
1. This is by far the most important. Having enough personal financial security that you do not need to be profitable to pay the bills. You have to be relaxed and be financially able to take the losses that will come.
2. This is almost as important and it is very difficult to do. Have no trading day directional bias for the market you are trading. That means ignore the daily charts, government reports and all news. Obviously know when the Fed is making its 2 PM announcement so you do not go into it with a position on the books.
3. This is an extension to point 2, but avoid developing a directional bias within the trading day. This happened to me on Friday: With the strong early up-move I formed a bias that it was going to be a strong up day and traded with a bullish bias for a bit before I realized what my mind was doing to me.
4. Obviously you do form a Position directional bias the second you enter a trade. Keep the words of Mark Douglass close at heart: "Once you enter a trade anything can happen" You have your edge but it is not 100%. It is important not to let "Position Bias" close your mind and cause you to wait too long to take your loss.
5. Even though I have this listed last it is probably the most important to me as I have to fight this constantly. Never ever ever ever, average down. The tragic thing is that this rule can be violated successfully most of the time. As you keep lowering your average cost it takes less of an up-move to break even. And with the volatility in the market you usually get a reaction large enough to get out even. But this causes you to miss the profit in the move and probably the next one in the opposite direction as well. Plus that one time when the market cascades against your HUGE position: Well, it can blow your month, year, or even your entire account.
Last edited:
Or so damn many throw pillows on the couch! Enough already with the throw pillows!
Norman R. Augustine: A hungry dog hunts best.