Back to the Basics

Discussion in 'Educational Resources' started by Brandonf, May 18, 2003.

  1. Brandonf

    Brandonf Sponsor

    This is what a "bad" gap against you looks like.

    [​IMG]

    :D
     
    #61     May 20, 2003
  2. Brandonf

    Brandonf Sponsor

    Tradingfrommainstreet.com will be providing Elitetrader members with a FREE 6 to 8 hour online short term trading seminar on Saturday May 31st.

    We have lined up an exciting list of speakrs with topics that include:

    Speaker: Toni Hansen, President of TRADINGFROMMAINSTREET.COM
    Topic: An Intro To Trends

    Speaker: Toni Hansen, President of TRADINGFROMMAINSTREET.COM
    Topic: Profiting from Trend Reversal Setups.

    Speaker: Brandon Fredrickson, CEO of TRADINGFROMMAINSTREET.COM
    Topic: Risk Managment.

    Speaker: Jeff Semmell, President of TRADINGSCANS.COM, a TFMS affiliate company.
    Topic: Profiting from Extremes in Crowd Psychology, Ooops Trading.

    Speaker: Brandon Fredrickson, CEO of TRADINGFROMMAINSTREET.COM
    Topic: Breaking Out of The Breakeven Trader Log Jam and Into Profitability

    Speaker: Ron Loftus, Mentor at TRADINGFROMMAINSTREET.COM
    Topic: Sharpening Your Profittaking Skills

    Speaker: Brandon Fredrickson, CEO of TRADINGFROMMAINSTREET.COM
    Topic: Effective Swingtrading and Nightly Scanning.


    This is not like other FREE seminars you may have attended in the past. You know the kind where you show up, get 15-20 minutes of free information and then a 3 hour sales pitch for the service they are really pitching. First, it is online, so you can attend directly from your computer in the EliteTrader.com Chatroom. Second, it is NOT filled with hype and sales pitches. In fact, speakers are specifically asked NOT to push any products or services, only to provide hard hitting trading information.

    The seminar kicks off at Noon Eastern, Saturday May 31st.
     
    #62     May 20, 2003
  3. Brandonf

    Brandonf Sponsor

    · Most traders wash out in the first year, and the failure rate for new traders is thought to be as high as 90%. Why?
    o No Business Plan:
    § Trading is a business not a hobby. If you do not treat it as a business you will fail
    § You must have measurable goals
    § You can only achieve success by deliberately setting out to achieve it, and you can’t become a great trader without deliberately deciding to do so
    o Lack of Discipline:
    § Getting into trades without a clear setup or plan (entry price, target price, protective stops)
    § Chasing trades they were late seeing, getting in too late
    § Holding losing trades beyond the original protective stop level
    § Selling winning positions too soon and not waiting for the target price to be hit when nothing about the trade technicals has changed
    o Lack of Money:
    § Commissions, Slippage and mistakes chew up new traders’ accounts before they have had enough time to become effective and experienced. This is magnified exponentially if the trader’s beginning port is under $20,000.
    § $40,000 is the minimum starting port size, $100,000 is preferred. $100,000-$150,000 is optimal after the trader has proven profitable at smaller port sizes and has slowly worked his quantities upwards after being successful at several increments.
    § There is a negative psychological cost to managing a small port because you are naturally protecting it rather than focusing on growing it.
    o Inexperience
    § Not many traders get to 1000 trades and are still in business, so the key is to get the experience you need by paper trading as long as the learning curve is still steep.
    § An aspiring trader can not be bashful funding their education, provided you have done the homework necessary to ensure that who you are learning from is worth listening to.
    § Losses are certainly a part of learning, since trading is so much learning how to lose properly as it is about making winning trades, but the traders who make it are the ones who kept their learning expenses cheap.
    o No Support System:
    § No mentor, no teacher, no way to easily avoid mistakes made by other traders before them
    § Lack of training and real world examples in current market conditions
    § Daily interaction with others striving toward the same goals
    o Lack of Focus:
    § Trading too many types of equities and not becoming an expert in any one kind. You need to gain an edge by focusing attention in very specific equities and setups.
    § Trading too many different setups that may work in some conditions but not others.
    o They Don’t Stay Neutral:
    § They get too emotional about their trading whether it’s excitement, boredom, fear or greed. It’s hard to tell if a good trader is up or down for the day, because they are simply executing their focused plan and acknowledging a businessman’s risk while they do so.
    o They Don’t keep a Trading Journal
    § How can you learn from your mistakes if you don’t document the decisions you made both good and bad on every single trade?
    § How can you review the past to help you with the future?
    § How do you know what approaches or techniques have changed if anything to make you more or less successful than you were in the past?
     
    #63     May 20, 2003
  4. Brandonf

    Brandonf Sponsor

    The first six months is about surviving and establishing good habits for the long haul, not thriving. Trading for a living is a tortoise and hare situation. The good ones go slow and make consistent progress then profits year after year. Surviving, planning and learning is thriving in the markets as a first year trader.

    The problem is most people do not have the system, discipline or patience to endure the steep learning curve. Most of the professional trading books I have read that don’t try to sell you anything state that losses over the first 6 months while you learn should be built into your trading plan and expenses for the first year. If you are trading only part time the timeframe to profitability should be extended even further into the 9-15 month range. That being said, here are some general strategies for mitigating trading risk I’m already employing:

    · Conduct trading as a business not a hobby.
    · Focus on a single market sector. I intend to focus on the NASDAQ, S&P 500 and DOW E-mini futures initially.
    · Focus on a single pattern or trade philosophy. Pick one or two entry patterns in a specific sector or market (such as futures) and trade on those patterns in those markets exclusively. My particular system and setups will be described in detail in following sections. It focuses on the Avalanche, Phoenix, Bearflag and Bullflag setups.
    · Ease into trading slowly, there is no rush. The longer I can extend my learning curve while getting income from existing sources the better. The markets aren’t going anywhere. The benefit of this approach is I can give myself more time to learn and get comfortable. The downside to this approach is I must still pay all my expenses in the form software, data subscription and educational services on a monthly basis while I learn at a slower pace.
    · Develop excellent money management techniques.
    · Develop a trading support system consisting of other traders, trading organizations, family and potential investors.
    o Join the Market Technicians Association (www.mta.org).
    o Join the local chapter of Day Traders USA (www.worldwidetraders.com)
    § They have monthly meetings for traders in the area to congregate and discuss trading related issues
    o Review P&L performance on a monthly and quartly basis.

    Brandon
     
    #64     May 20, 2003
  5. ddog

    ddog

    "Why did you delete the post you just made calling me a dumbass, Brandon? "

    How dare you question anything Brandon does, TommyC. Don't you know that since he sponsors a forum on here he can do and say whatever he wants?

    On top of that a self proclaimed "guru" is giving us a free lesson in basic TA that he is no doubt copying out of a book !
     
    #65     May 20, 2003
  6. Say what you like about it, but many of the newbies havn't got a clue about any of this, and there are a lot of them around right now...

    Natalie
     
    #66     May 20, 2003
  7. dbphoenix

    dbphoenix

    Really. Why people resent this sort of thing is beyond me.

    And this thread will be easy to search for in the future.
     
    #67     May 20, 2003
  8. Maybe it should be under "Resources", not "Trading".

    His website is a resource.
     
    #68     May 20, 2003
  9. Agreed Db, and it doesn't hurt people who have been around for a while to be reminded either.

    If it helps someone, somewhere - so much the better.

    Natalie
     
    #69     May 20, 2003
  10. Brandonf

    Brandonf Sponsor

    I really really want to try to keep this on topic as much as possible so that people don't have to wade through a lot of sludge to get the content. A lot of people here don't like me, maybe they had a bad experience with a chatroom, hell maybe they even had a bad one with me, it can happen. Anyway, I appreciate those who have taken the time to point out that they enjoy what I'm doing or have benefited from it etc, but Id just prefer to keep the tread on topic as much as possible and not focused around Brandon is Satan/Brandon is an angel.

    Thanks,
    Brandon
     
    #70     May 20, 2003