How to be competitive?

Hi all,

Surfing the Internet I came across an article "Is E-mini Day Trading For You?"
( Is E-mini Day Trading For You? )

In the first two paragraphs the writer states that trading the financial markets "is a very competitive business and only the most competitive will succeed" Which rules out about 90% of the human population.

I am trading CFD's on a daily basis and I'm wondering how you translate "competitive" to the daily practice of trading.

Although I'm quite new to trading the following things come up:
- a mindset to win
- a few years of experience
- a written trading plan with clear trading rules
- always use limit- and stop orders
- a sound money management system

Based on your experience, what do you guys and girls do/act/behave/etc to be competitive?

Kind regards,
Hans

Unipal said:

Hi all,

Surfing the Internet I came across an article "Is E-mini Day Trading For You?"
( Is E-mini Day Trading For You? )

In the first two paragraphs the writer states that trading the financial markets "is a very competitive business and only the most competitive will succeed" Which rules out about 90% of the human population.

I am trading CFD's on a daily basis and I'm wondering how you translate "competitive" to the daily practice of trading.

Although I'm quite new to trading the following things come up:
- a mindset to win
- a few years of experience
- a written trading plan with clear trading rules
- always use limit- and stop orders
- a sound money management system

Based on your experience, what do you guys and girls do/act/behave/etc to be competitive?

Kind regards,
Hans

Click to expand...

An interesting topic. I don't really regard myself as competing against the markets although I suppose that's what we do. I see it more like competing against myself - I have a good system & rules etc, but I'm only human and susceptible to the greed or fear which always appears when either I'm doing well/ badly. This is usually because I've strayed from the "straight & narrow" of my rules - ie discipline is King!

So it's a competition against my instincts which don't always match my well-tried and trusted rules that I know will work - but I'm too stupid to obey all the time. For me, there's no doubt that once you've got a decent system (and there are plenty on this board) it's a question of psychology and discipline.

It's as simple and hard as that IMHO.

Unipal said:

Although I'm quite new to trading the following things come up:
- a mindset to win
- a few years of experience
- a written trading plan with clear trading rules
- always use limit- and stop orders
- a sound money management system

Click to expand...

No need to always use limit orders and stop orders. If you want to buy then buy, if you want to sell then sell. If this means trading at market then trade at market. There can often be big advantages to trading at market.

Anyway, I would add to your list

- Self Control

- Developing as good an understanding as you can of the other market participants, how they think, how they react to certain things and how this will show itself in the market. Remember that most of them are pretty stupid and very emotional.

Trading is competitive

Unipal said:

Based on your experience, what do you guys and girls do/act/behave/etc to be competitive?

Click to expand...

Trading IS a competitive not a co-operative activity and to be successful you need to have a natural competitive streak. There is no doubt that this can be cultivated, intensified and honed through disciplined self-training, study and practice, but I think a real edge exists when the trait is inherent. I also have to disagree with 007 in regard to ‘decent’ systems. You cannot mechanise or systemise an arena of gladiatorial combat where only the fittest and shrewdest survive. The sooner you realise this the better off you will be.

I don't think it is a competition in the sense that salesmen might compete for business. I think it is more akin to conquering a mountain or a trek to the antartic, both of which have been in the news recently.

This type of competition requires challenging oneself against mighty forces, which is achieved by honing skills over many years and developping understanding of the nature of the beast you are trying to conquer.

In doing this there is often work required on self-examination just as much as examination of the market itself.

Charlton

It is most definately a competition with yourself.

It is also just as much a competition with the other market participants, but not neccessarily against them all at once. It is people (or computers programmed by people) buying and selling in the market that moves the prices so you have to understand how/why they're doing it. Some of these traders are enourmous and showing them agression would be like taking on a Shark with a toothpick and some are much much smaller.

You can think of it as a battlefield from something like Lord of the Rings. You can take on the giants and get crushed or you can join in with them and take some of their pickings. If you see a chance to gang up with a 5 or 6 others of your stature on a slightly smaller group, or on a larger player that you can overcome then take it etc etc. As I said above, you need to be aware of the the other market participants, who they are, what they are doing and how you expect them to behave in certain situations or under certain conditions. You are very definitely in a competion with them.

It's not competeive as such. It may be a competetive business.
It may be confidence, aggression and the ability to sensibly go against the herd. But also to know when you are pissing against the wind.I also think, as I have said elsewhere, "luck" plays a part and that is not to say you should rely on luck.

raysor said:

It's not competeive as such. It may be a competetive business.

Click to expand...

Eh??

Aspire said:

Eh??

Click to expand...

That's what I thought too. Trading is competitive in every aspect and I don't use the word 'competitive' as a metaphor, euphemism, symbolically or philosophically. Trading derivatives is a zero sum game so you have to beat someone in order to win and in order to beat someone you have to be better. It’s that simple and no simpler. How you cope before during and after a trade is a completely separate issue to trading being an intrinsically competitive activity...as such..