Why real traders do not discuss gains or losses...
- Thread starter Port1385
- Start date
I like these two posts - this one above and the first post.
This leads us to the point of the "psychology" sub-forum, which is to help the trader solve those psychological problems that keep him from being profitable. After trying to do so for over ten years, the only solution I found was to switch to what is covered by this other sub-forum - "Automated Trading".
I never learned to control my emotions enough to be profitable, despite trying for over 10 years. On top of it, while you're trying to learn it, you need to invest real money, because your emotions are not going to be the same whether you're paper trading or trading real money.
Also, the psychological factor (not applying stoplosses, other rules and so on), will keep you from focusing on whether you have a strategy that works or not. In other words, you will never know whether it's your psychology that's keeping you from making money, or if you don't have a winning strategy.
Automated trading allows you to assume, that whatever strategy you have, it will consist of fixed and univocal parameters and rules and that you will apply them without exceptions, getting rid of the psychological aspect altogether. But before starting it, you also make sure that your strategy works, by previously back-testing it.
Automated trading, preceded by strategy back testing, made me profitable overnight. Find what works, and use it.
You can do it in much less time than learning to control your emotions, and at zero expense, because your automated system doesn't see any difference between paper trading and real trading, so you can forward test it (live, including commissions, spread, slippage costs) as long as you want (besides being able to back-test it of course).
But an important point is full automation, because for almost a whole year I managed to still lose money with discretionary trading while the automated system was making money.
The difference it made for me is that with discretionary trading I was losing money every single month for over ten years (for a total of 50,000 dollars), and when I finally finished my automated system, I was doubling my money every month for a few months, then also lost everything twice due to adding some discretionary trading (but I also spent part of it, before losing everything). Anyway, the system made money, while I lost it. So I could say that it made money for a whole year. Now I applied no money management so I went through a drawdown and maybe I would have lost everything also without any discretionary trading...
Anyway, now I am back WITH money management and WITHOUT ANY discretionary trading, and have been fully automated for 35 days (about 24 trading days). I still went through a bad drawdown time BUT all that happened is that I didn't make any money for two weeks (I am trading several systems at once). Only made like 75% so far, but I was a bit unlucky. Anyway I took whatever losses came, without interfering with it. I don't even have the quotes page. I have no idea what is going on in the markets. I just turn it on and off once a day.
The only disadvantage is the reason why I postponed it for so long - it's a lot of work. It's years and years of work. Instead, discretionary trading is effortless and exciting. This is boring (and efficient). Discretionary trading is certainly much more fun and addictive. Well, anyway, it's all up to you. In my opinion automated trading is the only way to go.
Congratulations on your success.
I think I understand your question, putting your returns in percentages, is a way to avoid getting emotion about size?
If so, I think you have a good idea.
My thought would be to put your money management plan in terms of rules so that the rules tell you when to increase size.
I'll make up an example.
Let's say you have a system that gives you 2:1 RR (reward:risk)and you have a 40% W:L (win:loss) ratio.
If you are trading the ES and you feel that you need a 5pt stop (governed by the setup not your account), then you need $250 for each loss.
You may want to have enough beyond margin for ten losing trades in a row, but if you get more than 4 in a row take a break and re-evaluate why you are losing.
I hope it helps
just do not look at your emotions. you will be good.
when you drive a car, better pay attention to road conditions, while not think about possible car accident or look at the wrong ways.
if you look at your emotions, you will be fearful of getting wrong or feel superior to others. you will focus too much on those stuffs.
as someone said, people get what they want. when you see fears, you get fear, so you are like sheep, always want to make sure, sit sideline hesitate, you lost your own judgement ability. when you see greeds, all moving things on the screen are opportunities in your eyes, while you can not see there are lots of traps, they need be filtered out for true opportunity or trap.
the things in your mind are reality to you. we all know they are distorted by emotions or poor judgement. they just a reflection of the true reality, maybe just from one angle.
never look at your psych. just look at what is going on, and try your best to answer: what will the market do next? they will continue this move or they will reverse because of profit taking? if it will continue, then join it; if not go counter-trend to take profit before the market starts to do...
trading is an intelligent game. use your mind, not your psch.
when you drive a car, better pay attention to road conditions, while not think about possible car accident or look at the wrong ways.
if you look at your emotions, you will be fearful of getting wrong or feel superior to others. you will focus too much on those stuffs.
as someone said, people get what they want. when you see fears, you get fear, so you are like sheep, always want to make sure, sit sideline hesitate, you lost your own judgement ability. when you see greeds, all moving things on the screen are opportunities in your eyes, while you can not see there are lots of traps, they need be filtered out for true opportunity or trap.
the things in your mind are reality to you. we all know they are distorted by emotions or poor judgement. they just a reflection of the true reality, maybe just from one angle.
never look at your psych. just look at what is going on, and try your best to answer: what will the market do next? they will continue this move or they will reverse because of profit taking? if it will continue, then join it; if not go counter-trend to take profit before the market starts to do...
trading is an intelligent game. use your mind, not your psch.
concentrate on the game plan and execution edge, never the $.
keep your head down and grind it out.
stay consistent and focused on the % win goal line.
the job description is " master of my own universe......"
after a decade or so, the zeros will pile up in your wallet.
walk softly and carry a large roll.
red and italian also worxs.
cheers,
s
keep your head down and grind it out.
stay consistent and focused on the % win goal line.
the job description is " master of my own universe......"
after a decade or so, the zeros will pile up in your wallet.
walk softly and carry a large roll.
red and italian also worxs.
cheers,
s
It's taboo to talk about money.
People don't talk about their salaries or net worth in other walks of life. This isn't any different.
People don't talk about their salaries or net worth in other walks of life. This isn't any different.