I posted yesterday about maintaining your discipline through the day. It amazes me how somedays I am in complete control.. like today.. Only took trades within my system.. and while in the trades remained detached and executed the trade just as I should. I went over my plan last night.. wrote down my entry criteria.. also mapped out again my goal by hand.. and what I can achieve in just 2 years by maintaining discipline and sticking to my plan.. But yesterday, I was the complete oppositte. Totally out of ccontrol.. taking trades on a whim.. trying to catch back my losses.. doubling up.. and I got burned with it... Now if I can just maintain this mindset day in and day out I think I'll be okay..
I have a huge board above my screens, every time I stray from "the path" and consequently get whacked, I write down a few expletives... it is fairly full, and I read it before clickin the mouse. This seems the only thing that works for me, makin the same mistakes again and again is a painfull learning curve, and took me over a year.
Flashboy, here's a few things you can do: 1) Put your plan on paper. I call this the Personal Trading Plan. 1st plan is the Global Plan, this covers all of components in your trading: capital, risk tolerance, "trading stable", trading strategies, on and off peak daily activities, etc etc. The 2nd part of the plan is the Daily Plan: What your doing throughout the day (prepping for the open, trading at the open, key reversal times, your intra-period filtering process, etc, etc.) The Global Plan should be reviewed on a weekly basis, and the Daily PLan should have revisions for certain events (i.e. Rate decisions, double and triple witching, etc, etc) 2) Review your Daily Plan, at the beginning of each trading day. I have coached, mentored and traded with many commercial pilots over the years. They're all the most disciplined traders I have ever met (second to professional gamblers). Why so disciplined? Ever see the pilots in the cockpit reading through checklists as you board? It's amazing, these folks read through the checklist before every flight. They should know the whole thing by heart, but they still do it. Some of the pilot traders have told me that when they go through the list, they always manage to find something that needs to be fixed. It is this religious and humble approach and discipline that allows them to keep their head, even during the worst of times. It's quite profound to listen to a black box recording of a jet that goes down. The plane's fate is inevitable, yet the flight crew exhausts every avenue of effort to try and correct the problem. They don't lose their cool, because they have been training for that moment all through flight school. When they are in a losing trade, they get out, period. They "trust their instruments" and do what the instruments tell them. I fthe instruments say do nothing, they do nothing. Now I joked around in an earlier and similar thread by saying to put a thumbtack on the mouse button (which does work), but the reality is we have to train ourselves everyday. I will make a Personal Trading Plan available to ET members in the coming days. You have conquered half the problem already, you acknowledged, admiited and wish to fix the problem. Good luck.
wow, good post. i wonder if my pilot training has ever helped me in this new career. don't know, but that was a very moving post. thanks.
I know very little about aviation, but here's what I was told by someone who flies Cessna-like planes. You cannot tell whether or not your ascending or descending, the G-force has the same affect on the body. I took a flight with him and experienced just that. Many people get so accustomed to the window, and not the instruments, that's precisely how many pilots have perished. I see the window as a view of my human emotion, and the instruments as fact. For what it's worth, I think you should look back into your formal training, it's valuable. There aren't too many people who have it to take advantage of. Look forward to any other input the future on this parallel of flying and trading.
well i can definitely attest to this during my instrument training. you really separate the visual and the feelings you get, from what the indicators are telling you. it really does compare to trading in that respect. something that came up today....my indicators didn't work for shit. some of the guys i was trading with were doing great with other indicators. one of the things that we are taught as pilots is how each indicator works, and more importantly, why they work. this isn't so much for shits and giggles, but its to train us to recognize when they are not working properly. one of the biggest things as an instrument-rated pilot is to recognize and diagnose instrument failures....something that i should have done earlier today in my trading. i made a note of it and it was the lesson of the day for me. when you notice that something isn't normal, its usually because something changed. to truely know why can enable you to disregard bad information, and alternatively switch to other indicators that maybe better tell the tale.
Nothing to do with trading discipline but: I think that if I owned and flew a plane that I would secure a string with a fishing weight on the bottom of it to the top center of my cockpit about 12 inches back from the windshield and if that fishing weight was against my windsheild and my instruments were reading otherwise, I'd be incined to pullback on the stick and say to heck with the instruments especially if it was dark outside. Don't those gauges work on air vacum and the like. I'm thinking that instrument failure at night has probably taken more than one pilot when a weight on a piece of kite string could have saved him. If all else fails bail out under 10k feet.