I have had about 4 straight solid up weeks. I have developed a solid momentum based methodolgy (the last thing I ever thought I would do) and I see the light at the end of the tunnel.... Thanks guys. I am proof that discipline pays results.. -- Gene
i made money today, but i really should have only taken 1 trade. instead i took 2 and one was a loser. had i not taken the 1 trade not part of any of my systems, i would have made more $. i have my entry types grouped into systems. today i made a new system called the idiot system. any trades i'm taking that are not part of any of my plans are part of the idiot system. i'm trying to reduce/eliminate these trades. taking trades you know you're not supposed to is EXACTLY like eating food you know you're not supposed to according to your diet. you know very well it's wrong, but you don't fight the urge and do it anyway. then afterwards you feel terrible/pissed off about it. i think you just have to increasingly resist your negative urges. eventually you will BECOME a person who can resist the urge. you have to strengthen that part of your mind. just like practicing guitar...you strengthen something in your mind that enables you to play good. it takes time and does not happen overnight. same is true for eating correctly or trading correctly.
Overtrading is one the most encountered lack of discipline. If one understand why it is idiot to overtrade it can help to saty disciplined: http://www.elitetrader.com/vb/showthread.php?s=&postid=267823&highlight=overtrade#post267823 I have already said in another post so I just repeat that this is the abc to understand: higher frequency <=> higher leverage <=> higher risk, this is just rational probability. http://www.elitetrader.com/vb/showthread.php?s=&postid=254279&highlight=overtrade#post254279 Put a quota on the number of trades per day. When quota reached you quit for the day whatever the result. When it is ok after a few weeks/months then you can increase the quotas and you will perceive that...
I didn't realise I was a gambler until I started futures trading!I am currently moving back to shares as I had moderate success there which I believe is sustainable.Someone on another board suggested that I find a long-odds horse and put £10 on it at the start of the day - this would satisfy the gambling urge and leave me free for trading.If you've got gambling fever then I think the post by NihabaAshi has good advice for you and me!(He's really rather good,isn't he)!
Gene I use a momentum based system too, could you tell me a little about yours, maybe it would help me get a little more consistant.
Well you don't suspect it has conducted the author to discover God through that http://www.anandasangha.net/mysticmicrosoft/index.htm "You see, though I had tried to abandon God, he never abandoned me. And while I had walked away from organized religion, I never stopped searching for truth. I just had to search for it in my own way. And because that way was intricately wrapped up in my Microsoft career it was through that very channel that God brought me back to him. Microsoft, in other words, wasnât just the context in which the Divine Alchemist had wrought his transformation: Microsoft was his instrument!" Who said Microsoft was the instrument of AnteChrist whereas it has been an instrument for revealing God . So OO Programmers look deep inside the (new Bible ?) Code, Revelation may be inside
You have identified the problem - compulsive trading, or overtrading, or gambling or whatever you want to call it. The solution then is simple. Stop gambling/overtrading/compulsively trading. Now, this may be a bit like telling a fat person to eat less and exercise more, in that you know what to do, but you just lack the willpower to do it and break out of your self-destructive habits. In which case you have to find a mental "trick" to stop the gambling, and habituate yourself to a more disciplined approach. Generally, psychologists say it takes 6-8 weeks to habituate yourself to a behaviour (by doing it daily for that long, you then do it automatically). So my recommendation is this - come into work every day as normal, do your preparations, but then do not trade at all. Just watch the market, make a mental or written note of when your system would tell you to buy or sell, and then at the end of the day, see how you would have done. But do not trade at all. Repeat this for 8 weeks, watching the markets intensevely, but without placing so much as a single trade. The idea is to force yourself to learn to sit on your hands. Because you cannot trade, you will break your addiction to trading for the sake of it. You will become used to the idea of not trading at all, you will be *forced* to learn how to be patient. And noting down your signals, and the paper P&L you would have made, will help bring home to you how much more profitable a disciplined approach is, compared to the reckless gambler approach. For best results, tell someone you respect and who knows about your trading, what you are going to do. To them to check up on you, to make sure you have made no trades. That way, the dear of embarrassment will stop you breaking your self-imposed discipline, and doing the odd trade here and there (which will soon turn into full on compulsive trading). If this is too excrutiating, then a moderate alternative is to allow yourself only 1 trade per day. Once you have made an entry, and an exit, then you must sit on your hands for the rest of the day, without trading at all (you must still follow the market, however). p.s. I just noticed your 2nd post, glad to see you have "recovered". In this case, try the "sit on your hands" thing for one day only, and see how it feels. It is a useful experiment which helps you get a grip on your own psychology.
I have been trading five years now. I knew how to make money after the first year but for a little over four years I could not overcome those death spirals. I could make money for four days and friday lose it all back plus some more. I quit smoking some time back and overcame problems with weight and alcohol so I do have some willpower. After every one of these episodes I was in shock because I could not believe I had done it again. This went on forever. I quit trading several times because of it. I finally decided that I would set a maximum loss for the day and come hell or high water I would quit when I got there. This time it worked. I still do it. If I reach my limit I turn off the computers and go find something else to do for the rest of the day. It gets easier after you realize that theres always another trade around the corner. The market is not going anywhere. The number one rule in trading, imo, is keep your losses small.
I don't drink (not more than 1/2 a bottle of coke and orange juice), I don't smoke (my partner drinks and smokes but not me ) and I don't understand people's tendancy to masochism and even suicide themselve against their own will .
CUTTEN - Adding your ideas to the repertoire when I feel like I might be getting 'out of control'. Thanks to you, and EVERYONE for their valuable input... You make some interesting points as well Harry... -- Gene