Wow, well said goldenarm. That should be published (I guess it just was). I know my downfall is exactly that: Not controlling my emotions and not having the discipline to follow my plan through thick and thin. What happens when I'm trading well and bringing in some money? I loose discipline because, well, the moneys coming in and I can afford to bend the rules a bit to make even more profits. I tell myself that this is an easy game and I get lax. And when the money is flying out the window? I gotta get it back. And get it back right now! So I will bet too large or try some bogus set-up that I think will net me bigger, faster profits. I recently ran my account up 80% over a three month period. But when the chinese market got hit in February, I took a big hit. I was still doing okay but I just couldn't stand the thought of all the profits I had lost. So I tried to make it all back in a hurry and broke all my rules. Well now all my profits from that three months are gone plus more. On a deeper level, for me, I believe a lot of it has to do with psychology. More specifically, my comfort level with being highly successful and making a lot of money. Trading has just too many land mines. They are everywhere. And they all have to do with the person, not the plan.
not! once you're afraid you can't control or master the fear. Read "trading in the zone" by mark douglas for a better understanding of emotions and trading. every newbie (or oldie, lol) should read that book.
-------------- As the previous poster advised, you should read a copy of Trading in the Zone by Mark Douglas. His definition is "An edge is nothing more than an indication of a higher probability of one thing happening over another." I would assume most people would agree with this statement and by its very nature can mean many things. As Don mentioned, having access to more capital is an edge. Another edge i can think of is having the S&P emini futures charts as a leading indicator when daytrading stocks can also be considered an edge (in general when the futures go up many of the big caps tend to follow suit). Yet another example is having access to credits/rebates (when compared to the average retail investor/trader they do not have the same low cost structure of a prop. trader).