Ok. Trading doesn't require high intellect but you can make better money than one would washing dishes (less if you make the same mistakes over and over again). If you're talking about risk management then, no, I have a well defined system but there is no "test" for it. Money management = Risk management. Risk management is diffcult and requires systemic analysis. But, it is a wholly different issue when compared to live trading and making difficult decisions on the fly. I am a discretionary trader. I will watch a price pattern and listen to my gut. More often than not, my gut is right. This is a developed intution/skill from watching real time price with real money on the line. I make many mistakes daily but they cost me little because I have learned the pain of losing real money and I want to avoid it (kind of like a pavlovian response to knowing when you are going to get kicked in the nuts and moving out of the way). IMO you only find out your own personal tolerance for risk the hard way, by risking and losing real money. Then you set your risk accordingly and make the mistake a few more times. Pain is the only way to learn. Mike
Try it like this: A theory of market action, which requires testing against real conditions, is like what the aircraft designer uses. Actual trading, which you are describing, corresponds to what the pilot does. One's no good without the other.
Has anyone here been paper trading or had paper traded for a long period of time ? Could you let me know what you have used or been using to papertrade ?
This is one of those issues on which opinion seems to be devided down the middle.IMHO, Paper trading is only good for one thing and that is testing your method without the risk of losing your money. If your method passes this test then it may or may not pass the test of live trading but if it does not pass the test of paper trading then it almost certainly will not pass the test of live trading.
The key is to condition your mind to trade the same with paper trading and real money. A old trader friend of mine once said. So you want to be a day trader ? Stand over an open fire and drop big faces into it one at a time. When you get to the point where watching the money burn has zero negative affect on your emotion, you will be ready to play the game.