This is how you remain constantly profitable. 1. Be well CAPITALIZED. 2. Have an EDGE. 3. Trade only your EDGE following strict RULES you have tested for a considerable amount of time which shows positive expectancy. 4. Never ever let your thoughts and emotions make your trading decisions. 5. Never get depressed or fearful about your losses, never get euphoric about your wins. Its only about following your rules nothing else. 6. Trade consistently like this for 3 to 5 years full time - day in, day out. Read the 6 sentences ABOVE. In reality, you have to turn into an AUTOMATED MACHINE to be a profitable trader. Can you do it? Only if you are willing to go to places within your own soul that you have never been to, you will experience emotional pain like you never knew existed, you will feel frustration and anger at yourself that at times you will not be able to withstand, you will feel like the biggest loser on the planet, and curse yourself why did I choose this profession, why couldn't I have done something else. If you are weak, you will drink and do drugs, if you are strong you will remain objective, eat healthy, exercise daily and maintain a disciplined lifestyle. And then as you keep engaging with the market you will continue to get beat up but with the work and change in mindset, slowly you will let go of your fears, and your attachment to money, your thoughts, maybe if you have put in enough time and done the work you will start making money. But the wonderful thing is by the time you reach this phase, making money will not be important at all, it never was about the money you will realize and just like riding a bicycle or driving a car trading will become effortless. BUT IF YOU ARE NOT WELL CAPITALIZED, YOU DON'T STAND A CHANCE.
%% Good post, big mistake most of us made learning was ''leverage ignorance'' That's where we all start- ignorant . Some may want to find out why there are so many, many, more profitable investors than traders in US stocks, ETFs,mutual funds, real estate and anything. Not a prediction; just because we have been overdue for a bear market does not mean we have one anytime soon, I thought we would get a ''sell in May ,hey.'' LOL
%% Sometimes; some times ,not so much. it would be easy if anyone could predict , but that is what makes it tough sometimes
Most people do not act rationally. It's hard because people have emotions, it's the reason why most people fail.
You'd make a great computer. It sux that you are correct however. We humans just can't seem to get past that whole "being human" thing.
Of course money makes money, but it is far more important to understand risk and what trading risk means. An edge is very debatable, as there are many perceived edges in relation to understanding how and why markets move as they do.. nearly all of these perceived edges are just coincidences. There is one thing that happens in every market all of the time, but it is not the same for every market! This one thing can be exploited to reduce risk when trading..not so much for investing! Adequate capital is sufficient if adequate experience and knowledge is attained. Large drawdowns equate to lack of experience and knowledge. There are very few wise young Owls around!
Technically it is correct, the older people get the slower they work and the easier they slot in to the market cycles. If you can artificially slow everything down you can do the same but human psychology, namely the conscious mind, will fight it all the way. It's very simple, to bypass the conscious mind never do what you want to do, tough skill to master.
Trading doesn't increase GDP or GNP trading in the exchange produces nothing of value the economy. waste of life trading same productivity as some guys in poker table. producing nothing. Traders add no value to companies or the market. The market doesn't need traders.
Great post KTM. Ironically just a shame it probably takes some experience to understand and believe in it.