Traders Not Trades Bring Wins or Losses
Wins and Losses are familiar to us all, the pain of loss and the joy of a win. There is no confusion there.
With trading losses, the majority of the time the shortfall comes from the trader and no the trading strategy.
Uh huh... that is most likely you! However, help is on the way.... I am going to discuss ways to stop financial losses, and begin being a winner at the trades. Prior to placing orders, you have to decide where your stop loss order will be placed.
You can't delve into the topic of position entry thoroughly without speaking of stops. The question is, "Why are stop losses used by so few investors?" If not using stops is a weakness for you then you want this info. This info could mean the difference between on time retirement with a fat nest egg or just 'getting by' at a later retirement date.
Plan and place stops equals your plan to win, and you are prepared to have a loss but make it through to continue trading. A look at the traders psychology of loss taking is in order here.
All professional traders understand they must know where they are getting out before they get in. They have to know ahead of time what a wrong trade looks like so they can exit it quickly. This is a rudimentary fundamental that EVERY professional trader knows the answer to.
Are you able to respond to these questions?
1.) What are the indicators for staying put, or getting out?
2.) Do you have a rule to tell you when to sell a losing stock?
3.) Do you have a rule of when to move your stop to break-even?
If the answers to these questions elude you, you are not unique. What it says though, is that you need to get some regulations set for yourself, particularly when going to short stocks. But these trading rules won't amount to a hill of beans if they aren't used. If you aren't using them you need discover why it is you don't manage your risks in a professional and non passive style.
Many investors refuse to take a loss for two basic reasons:
1. Admit they are wrong? No Way!
For many traders a realized loss is a huge admittance of being wrong and that is just too hurtful to acknowledge. To them it is linked to being a failure at life and their self image is directly affected by this perceived failure.
A trader like this experiences real pain from the loss, and would rather deny it than fess up to the fact that it is giving them the pain. Quite often it requires a total loss before he can begin to change. To quit trading is the only other alternative.
2. Their portfolio, because of its size, can take a hit that big.
Losses aren't just on paper, they are real. The loss is what it is and the quoted price is it's value.
Both of these examples are a form of self-delusion that millions of investors, both large and small, suffer from. Just look at AIG, Merrill Lynch, WAMU, Lehman, etc. ... and you can take comfort in the fact that self-delusion is no respecter of income bracket or social standing.
If this article is making you uncomfortable or bringing up feelings of anger or powerlessness, then that's a good sign. It means you have enough self-awareness to change.
The winning trader uses a different strategy from the losing trader by regarding the pain from the loss in an impersonal way. They use the loss as a sign that something went wrong with their approach, or their execution, but NOT that something is wrong with them.
A winning trader distinguishes himself from what he does. They are aware that their worth as a human being is not linked to their skill at trading, but that they will need to increase their skill and experience to improve their approach and execution. They use the pain they feel to motivate themselves and increase their drive to be a better trader.
You choose what to do with the losses, grow from the pain or give in and quit. Using the emotions for positive growth is what is important, not the fact that you had a loss.
Stay true to my tried and true ETF Trend Trading System and develop the habits of a winner. Apply yourself, ask questions, and observe your position size as it relates to your portfolio and your trading trends will move to the winning side.
"Proper Stops and risks" are main points in my program and reminding you constantly of that is an important part of my mentorship program. Once you have gone through my program completely and thoroughly understand it, you will still want me to tell you "Don't move your stop" and "Be sure to take profits when my system tells you to, not earlier or later" In fact the mentorship program is probably valued higher than the course itself. - 23200
With trading losses, the majority of the time the shortfall comes from the trader and no the trading strategy.
Uh huh... that is most likely you! However, help is on the way.... I am going to discuss ways to stop financial losses, and begin being a winner at the trades. Prior to placing orders, you have to decide where your stop loss order will be placed.
You can't delve into the topic of position entry thoroughly without speaking of stops. The question is, "Why are stop losses used by so few investors?" If not using stops is a weakness for you then you want this info. This info could mean the difference between on time retirement with a fat nest egg or just 'getting by' at a later retirement date.
Plan and place stops equals your plan to win, and you are prepared to have a loss but make it through to continue trading. A look at the traders psychology of loss taking is in order here.
All professional traders understand they must know where they are getting out before they get in. They have to know ahead of time what a wrong trade looks like so they can exit it quickly. This is a rudimentary fundamental that EVERY professional trader knows the answer to.
Are you able to respond to these questions?
1.) What are the indicators for staying put, or getting out?
2.) Do you have a rule to tell you when to sell a losing stock?
3.) Do you have a rule of when to move your stop to break-even?
If the answers to these questions elude you, you are not unique. What it says though, is that you need to get some regulations set for yourself, particularly when going to short stocks. But these trading rules won't amount to a hill of beans if they aren't used. If you aren't using them you need discover why it is you don't manage your risks in a professional and non passive style.
Many investors refuse to take a loss for two basic reasons:
1. Admit they are wrong? No Way!
For many traders a realized loss is a huge admittance of being wrong and that is just too hurtful to acknowledge. To them it is linked to being a failure at life and their self image is directly affected by this perceived failure.
A trader like this experiences real pain from the loss, and would rather deny it than fess up to the fact that it is giving them the pain. Quite often it requires a total loss before he can begin to change. To quit trading is the only other alternative.
2. Their portfolio, because of its size, can take a hit that big.
Losses aren't just on paper, they are real. The loss is what it is and the quoted price is it's value.
Both of these examples are a form of self-delusion that millions of investors, both large and small, suffer from. Just look at AIG, Merrill Lynch, WAMU, Lehman, etc. ... and you can take comfort in the fact that self-delusion is no respecter of income bracket or social standing.
If this article is making you uncomfortable or bringing up feelings of anger or powerlessness, then that's a good sign. It means you have enough self-awareness to change.
The winning trader uses a different strategy from the losing trader by regarding the pain from the loss in an impersonal way. They use the loss as a sign that something went wrong with their approach, or their execution, but NOT that something is wrong with them.
A winning trader distinguishes himself from what he does. They are aware that their worth as a human being is not linked to their skill at trading, but that they will need to increase their skill and experience to improve their approach and execution. They use the pain they feel to motivate themselves and increase their drive to be a better trader.
You choose what to do with the losses, grow from the pain or give in and quit. Using the emotions for positive growth is what is important, not the fact that you had a loss.
Stay true to my tried and true ETF Trend Trading System and develop the habits of a winner. Apply yourself, ask questions, and observe your position size as it relates to your portfolio and your trading trends will move to the winning side.
"Proper Stops and risks" are main points in my program and reminding you constantly of that is an important part of my mentorship program. Once you have gone through my program completely and thoroughly understand it, you will still want me to tell you "Don't move your stop" and "Be sure to take profits when my system tells you to, not earlier or later" In fact the mentorship program is probably valued higher than the course itself. - 23200
About the Author:
Learn how it's very possible to make 6% per month in your investment accounts using etf trend trading! "Big A" is a recognized expert in the world of etf trend trading system & reveals etf secrets that have been kept under wraps by hedge traders for years. Get his free report & webinar today!
posted by X - Men @ 6:04 AM
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