I Bet You Think You Are..., But Are You Really Actually Even Trading???!!

[spanish89]

I will not go into much detail now as im slightly tired, but so will come back and add more in later.. :cheesy:


This thread has been placed in the newbies forum since it will apply to almost every single newbie trader, although after speaking to and reading posts from many of the longer term members of this website (Doesn't actually mean anything in terms of trading profitability n success), this topic may apply to many of you also as a way to just atleast review the way you look at the markets.


I know what the 1st instinct response and answers will be by most of you to my questions, but so please do actually seriously think it through before just writing that.



How do you actually view the markets??

Not how you think you view them or would like to view them, how in actual practise when trading are you viewing them??


Do you view them as a sort of advanced gambling circuit??

Where your stoploss is 'your bet stake', and any profit you make is 'you winnings, and if you got in at the wrong time in the wrong direction for that time your 'bet stake' is taken away from you as the loss.


OR


Do you view them as an actual real physical market-place??

Where your 'purchase contracts' for a certain price (the spread price), these contracts say you can buy or sell that product at the price on the contract, and so you purchase these contracts depending on the direction in which you think the market for that produc is going to head over the next few minutes/hours/days.
And then hold that contract in your hand till you can cash it in for profit, or if you think the market is infact now going to continue going the opposite way for quite a long time before it goes in your favor you just get rid of that contract as quick as possible for a loss and get a contract for the other direction instead.





Most people who now trade online do infact view the market as the 1st option when they are actually trading, even if they dont intend to, since that is the way the market is layedout and portrayed online.

And i believe that this is the reason why most newbie traders lose lots n lots of money in lot of little trades to start with, and then many traders who may have been trading for many many years but not done well at all even after all those years still continue to lose lots of money in these little trades...

As they actually are subconciouslly automatically viewing the markets online as a gambling circuit, using the stoploss as their 'Bet stake', and then just hoping that tht stake doesnt get touched and taken out in the future before it goes in their favour.




I will probably expand in more detail on this, as i feel it could seriously benefit ALOT of traders out there, but what is everyone elses view on this pyschological aspect to how people ae now trading online??







(Btw i would just like to state that im not trying to preach and convert everyone to using my giant untouchable stoplosses style n method of trading, since at the end of the day everyone's trading with their own money, and i do understand alot of people do not feel safer using a giant stoploss instead of a tight/medium one, and os i dont try forcing anyone to use one.)



This topic is more to try and get people thinking about how they are actually viewing this 'market' that they are trading on.

 

[chilltrader]

Lets face it Spanish - what you do is basic gambling!!

But if it makes you profit, does it really matter?!!!

People can call it whatever they want. But if your strategy is making you money. Go for it!
If you are still on these boards for another year then probably time to write a book ))

 

[keano]

I guess most people who are new to trading probably employ a similar method to you. Basically using their account size as their stoploss.

Once they have blown up they begin to learn about ways of reducing that risk with advanced entry techniques and small stops.

Go through some of my old posts where I posted daily screenshots of my account blotter (I know you only want to hear from people who actually trade profitably and prove it )

 

[spanish89]

I guess most people who are new to trading probably employ a similar method to you. Basically using their account size as their stoploss.

The majority of newbie taders start by doing the exact opposite from all ive seen tbh mate.

When they are 1st starting theare so scared of ever losing money, that they think if they use the minimum stoplosses they will be losing less money overall if they did get wrong direction and so do ''lose'' that trade.


But ths is their biggest mistke as they are viewing the stoploss as 'a bet stake', and so they may only lose a little, but lose it repeately consistently.



The reason im consistently making so much profit now is because i 'position trade', but actually trade with the 2nd view of the market, and so accept that you do have to let smetres go into a big loss for a few hours or dayseven before you make profit on it.

 

[CHRISTO9HER]

Spanish: I wish you would stop encouraging people (especially newbs) to follow anything like your strategy. You are going to blow your whole account one day by letting your losses run out and I would hate to think that you may cause someone else to do the same. What you do with your money (and your mum's) is your business but try not to preach to newbs until you have a bit more of a track record with your system.

Newbies: Take Spanish's advice with a pinch of salt, he is not destined for riches through trading, he is a gambler. Instead listen to the more experienced traders on here who can help you design a system with a decent risk/reward ratio. Good luck!!

 

[shadowninja]

Well, you certainly need to treat trading as a serious business, not as a punt. If you are looking for something in the market...
-approval (looking for the market to show that you are right and can't take it when the market shows you are wrong with a loss),
-joy,
-fun,
-happiness (and resulting unhappiness when you lose)...
then you're not ready to trade.

I was looking at these videos last night. The guy finds trading boring and just does it to earn money. Videos and day trading updates from Harvey Walsh: Day Trading Freedom The demeanor of his voice is interesting. It's just like he's having a conversation with someone over a cup of coffee. No "YES! BACK OF THE NET!!!" or "NOOOOO! THE MARKET HATES ME!". No emotional attachment. Just cold, calm, calculated trades.

 

[spanish89]

Spanish:You are going to blow your whole account one day

You know what, 1day i may blow my whole account mate. Im happy to keep my account at just £5,000, but i sure 1day il get caught the wrong side of a giant $25 oil move at £2tick, and so il oe l that 5k.

But between now and when that time my happen i will have consistently been making very decent money everyday, day after day, and so will have banked enough over the months or years to be able to not really notice that 5k loss.

a system with a decent risk/reward ratio. Good luck!!

Ahh another gambler i see though mate, with the old ''system'' idea..

And the old risk/reward phrase is the classic example of what i mean by tading with a ''Bet Stake'', and hoping for good oddsn winnings.

 

[shadowninja]

When they are 1st starting theare so scared of ever losing money, that they think if they use the minimum stoplosses they will be losing less money overall if they did get wrong direction and so do ''lose'' that trade.

The reason im consistently making so much profit now is because i 'position trade', but actually trade with the 2nd view of the market, and so accept that you do have to let smetres go into a big loss for a few hours or dayseven before you make profit on it.

1) Easy. Don't get the direction wrong, then. If you see a trade fall away from you, then accept you are wrong, close it and move to the next signal. If you are getting a lot of bad trades, then the market is telling you that your system is rubbish. Learn what needs to be done to give you signals that send the price in your direction immediately. A lot of the professional day traders expect to be in profit immediately (within 5 minutes); if it isn't they close the position. Read Market Wizards.

2) You are not position trading. Position traders expect thousands of ticks of profit, they'll leave their position open for months. And they still only use a couple of hundred ticks stop loss. And they may only trade once a fortnight.

 

[shadowninja]

And the old risk/reward phrase is the classic example of what i mean by tading with a ''Bet Stake'', and hoping for good oddsn winnings.

Risk/reward is what all professional traders, and successful business men, consider. Try studying and not ranting without a knowledge base.

 

[shadowninja]

Spanish, I really don't understand you. You've got easy access (via the chatroom) to two successful day traders (FXScalper and Arabianights), they are happy to answer your questions and teach you how to become successful - anyone in your position would be lapping up everything they said, eager to learn from them, and yet you insist on doing something that they tell you not to. Why is that?

 

[keano]

The majority of newbie taders start by doing the exact opposite from all ive seen tbh mate.

Maybe you're right, but in fairness i've been involved with trading for a lot longer than you and from what i've seen the general process is something ike this:

Person funds account and starts trading using small stops because thats what they've been told to do. Their entries are bad and they take lots of small hits and lse most of their account.

They then decide that the trick is to have a stoploss that "cant be hit" where they will only be "stopped out" when they have no equity left. They will win every day. Then they will get stuck in a trade that lasts for a month or so (opportunity cost anyone???) but the trade will eventually com good. They will again win everyday until they get on the wrong side of a new longterm trend and have their account blown up.

After these two set backs most people will give up trading (hense the huge failure rate). The ones who can afford to try again are the ones who have a chance of making it in my opinion.

I wish you well but I think i know how it will end.



On the note of harvey walsh though - fuocointerno.wordpress.com

hmmmm.....

 

[barjon]

spanish

It matters not one jot what you call it. When you trade you enter a transaction where the prospects are uncertain and your transaction can either turn out to be profitable or loss making. You do, of course, pay money to engage in that transaction - by the commission + spread or a wider spread if you are using sb - so you always start off in a losing position and need to "win" just to break even. In your last daily account you had around forty trades so you had a lot of winning to do before you even thought about overall profit.

However fuddy duddy you might think traders with long experience may be, it's a common feature that their experience leads them to give their first priority to protecting their capital and restricting their losses. You need to ask yourself why they do this. At the moment you seem to be taking the position that "everyone is out of step but spanish" - not that you can yet be classified as an experienced trader.

Your views seem set by the very short experience you have had so far and if you are still trading in five years time it'll be interesting to see if you still hold them - I very much doubt it.

jon

 

[prop]

"The majority of newbie taders "

so spanish do you consider yourself an experienced trader now ?

 

[spanish89]

"The majority of newbie taders "

so spanish do you consider yourself an experienced trader now ?

No i wouldnt call myself a trader with many years of experience, as even though i was profiting from the stockmarket since the age of 8, i only actually started 'trading via sbs' about 9months ago.


But in my 9months ive learnt alot about how to lose money n the markets consistently, and then how to consistently make money.


And so have developed certain views that i now share with others on here to try and help people who are currently trying the more conventional methods n styles of trading but are not making consistent money from it.




Do you consider yourself an experienced sucessful trader??

 

[the blades]

But in my 9months ive learnt alot about how to lose money n the markets consistently, and then how to consistently make money.

correct me if I'm wrong, but I'm sure I read a post of yours within the last few days where you announced your trading capital (and in fact every penny you owned) was about 1200 quid?

"you cannot be serious"

UTB

 

[Lightning McQueen]

I thought it was more than that and over the £2k mark, I must have missed some bad directional trades in the last week where the ultra wide stops were perhaps a tad too wide for comfort on £2k ...ouch!

Although I have to say I'm very intrigued where he is going to go with his reversion to the mean strategy on stocks mentioned in his fannie thread ...truly shocking or enlightening ...bets are on

 

[doberman]

I have put 2k in to my account to learn to trade as i dont think a demo account is the same.
If i can make the acc grow with in say one month to 3.5k / 5k I will fund my acc with 50k.
I want to make 10% on my acc per day or x amount of trades.
So please coerect me if this is not possible or is to much of a rick to be hopping to make a living
as I want it to be a dependable living as others depended on me.
So My first trade = 10% of acc £2 per pip to gain 100 pips with a 20 pip s/l,
lets say i got stoped out ,
now need a gain of 120 pips,
again stoped out,
now need a gain of 140 pips
and so on by the end of the first day i made it 10% up.
Day two £2200 account, first trade of the day £2.2 and get 100 pips ,
£2420 in acc next trade £2.42 per pip and so on if the acc has a bad run and goes in to - say £1800
then each trade is £1.8 pep pip 20 to 30 pip stoploss
but the goal is to gain 10% per day or by x amount of trades.
I must add that i all ready have incared big losses and am awear orthe risk but do belive that i
have what it will take to make it in this game with the help of you guys.

 

[shadowninja]

I have put 2k in to my account to learn to trade as i dont think a demo account is the same.

The assumption is that you have a working system. Demo trade until you have figured out a profitable trading system then worry about the psychological factors. Why pay £2k to work out your system is crap?

 

[Shanghai]

I have put 2k in to my account to learn to trade as i dont think a demo account is the same.
If i can make the acc grow with in say one month to 3.5k / 5k I will fund my acc with 50k.
I want to make 10% on my acc per day or x amount of trades.
So please coerect me if this is not possible or is to much of a rick to be hopping to make a living

10% on your account every day? Can you imagine what they would compound to every year? The simple answer to your question is no, that is not achieveable on a consistent basis and if you try you would be taking on too much risk. Many professional traders would be quite happy with 25-30% a year if they can do it consistently in all markets.

 

[Trader333]

At even 1% a day you would be doing exceptionally well and 10% a day is just not sustainable.


Paul