https://crestray.wordpress.com/2015/02/24/want-to-be-a-trader-learn-to-be-a-loser/
Thoughts/comments most welcome.
regards
CR
Thoughts/comments most welcome.
regards
CR
Good points CR.
In trading, you must accept a level of failure that would be unacceptable in other environments as being just a business overhead. You have to accept that perfectly applying a sound method will still not eliminate failures. Also that those failures will take the benefits of money away from you and your family.
Most new traders cannot accept the psychological damage that's part of trading and try to trade away from failure. This causes behaviour which increases risk, which eventually drives them out of trading.
Losses have to be kept small, but you have to love them because they just prove you're still in the game.
In trading, you must accept a level of failure that would be unacceptable in other environments as being just a business overhead. You have to accept that perfectly applying a sound method will still not eliminate failures. Also that those failures will take the benefits of money away from you and your family.
Most new traders cannot accept the psychological damage that's part of trading and try to trade away from failure. This causes behaviour which increases risk, which eventually drives them out of trading.
Losses have to be kept small, but you have to love them because they just prove you're still in the game.
richieforex
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It is in our nature to want to be correct, you cannot win on every trade and this is what traders find hard to accept.
It is important to understand how many trades on average you are likely to lose before you get a winning trade to help deal with the losses. I have learnt to enjoy losing trades because I know the probability of the next trade being a winner is enhanced.
Win percentage however is irrelevant. Most of the traders I know have a win percentage of no more than 70% and some as low as 30%. The 30% are still profitable sometimes even more so than the 70%.
It is important to understand the mechanics which allow you to make money whilst still losing.
It is important to understand how many trades on average you are likely to lose before you get a winning trade to help deal with the losses. I have learnt to enjoy losing trades because I know the probability of the next trade being a winner is enhanced.
Win percentage however is irrelevant. Most of the traders I know have a win percentage of no more than 70% and some as low as 30%. The 30% are still profitable sometimes even more so than the 70%.
It is important to understand the mechanics which allow you to make money whilst still losing.
Couldn't agree more. Win ratio is pretty irrelevant and that's what I was trying to highlight. If I have a system that HISTORICALLY has proven to make profitible trades 90% of the time, that doesn't tell me with any certainty whether my next trade will be profitible or not. What it may do however is lead me to take outsized risks under the assumption that there's a high certainty of it being a winner. That's where things can go wrong, quickly.
If you're going to bet the farm. Have two farms...
If you're going to bet the farm. Have two farms...
Svetlana Korj
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You must be able to react to failures right. Not only on forex. It is important not to lose heart, do not give up, and try to calm down and analyze your mistakes to avoid repeating them more. And then again to take a step forward. The main thing we must not let fear block and force us to turn back.
Charles Bronson
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Most don't have to learn to be losers, they already are as a result of their social conditioning. What we truly have to develop is how to be winners. It is a totally different way of being.
Losers and winners have a different view on losses. That view is what makes all the difference.
Losers create losses with occasional wins. Winners create winners with an occasional loss.
Losers and winners have a different view on losses. That view is what makes all the difference.
Losers create losses with occasional wins. Winners create winners with an occasional loss.
But how is the years of social conditioning undone?
Charles Bronson
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Thats like asking how long is a piece of string. The path is different for all of us our experiences are unique to us only. Too detailed to discuss here.
But a good way to start is to start becoming aware of your response patterns. The chances are they will be same responses to an emotion in different situations. Giving your self more options is a good way as it gets you thinking in a more adaptive mindset as opposed to old responses that may no longer serve you well. As with trading there are plenty of websites offering methods to help you do that. Lots of information is also free .Its up to you which one suits you best.
That's interesting because my next planned trading endeavour is in researching mindfulness and it's applications in trading.
So you mean that instead of 90% you would go for 55%? I would think that the highest the win rate the highest the probability of winning all other things being equal.
There is no certainty in trading. You cannot use lack of "certainty" to argue against high win rate. Always base decision on forward trading, not historical. If you have traded two system live and one has win rate 90% and the other 55% then you should know which one is better.
Most experts will not agree with you also. See this article for example.
momothebored
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Right. Because you're OBVIOUSLY competent enough to tell people like it is.
HAAHAHAHAHAHAHAHAHAHAHAHHAHAHAHA
Top trader making $700 in 10 trades and bragging about it online
Oh My God.
HAHAHAAHAHAHAHHAHAHAHAHAHAHAHAHAHHAA
Lúidín
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Right. Because you're OBVIOUSLY competent enough to tell people like it is.
HAAHAHAHAHAHAHAHAHAHAHAHHAHAHAHA
Top trader making $700 in 10 trades and bragging about it online
Oh My God.
HAHAHAAHAHAHAHHAHAHAHAHAHAHAHAHAHHAA
There is absolutely nothing wrong with making $700 with 10 trades.
10 trades for $700 profit can be opened and closed within the first 30 minutes of the US open.
That equates to an hourly rate of $1400 - a good junior barristers' pay level.
I am quite confident that if drtro can make $700 with 10 trades then he can easily make much more, if he is not doing so already.
Lúidín
Lúidín
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That is a very good read that I think most will never fully understand, until it is too late.
The article, if read correctly, poses another question which is far more important than keeping your losses small.
Lúidín
you clearly haven't got the point. What sort of moron do you think i am that I wouldn't rather a 90% win rate over a 55% win rate?!
Looking at an individual trade, having a 90% win rate and a 55% win rate does not change the uncertainty over whether that will be a winning trade or not. that's all im saying. feel free to throw the statistics textbooks at me...
also, for my reference, how do you define an expert?
CR
Looking at an individual trade, having a 90% win rate and a 55% win rate does not change the uncertainty over whether that will be a winning trade or not. that's all im saying. feel free to throw the statistics textbooks at me...
also, for my reference, how do you define an expert?
CR
Who's being pessimistic? Manage your money as if the trade is going to be a loser and all you can have from that trade is upside... sounds pretty good to me.
Please can you elaborate on your "trading is like a sport" comment? thanks
CR
Please can you elaborate on your "trading is like a sport" comment? thanks
CR
Lúidín
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I am surprised that none of the car salesmen have turned up in this thread, but that will probably change, which of course is fine, as that is what they do, try and sell you something.
Firstly, your line of thought is 100% correct, and do not let any person try and change your mind, for, the only sure thing about trading is that you can, and will, lose money, so it is best to treat every trade as a loser from the word go.
This, however, does in no way mean that you have to lose on every trade, for that would be just plain silly, and why would you even bother to waste your time trying.
If you haven't noticed already, this section of the site gets very little attention, which in itself explains why most who try find it very hard to make any real progress. The majority spend endless hours looking to others for help, not realizing, that they must learn how to help themselves first, before any progress worth talking about can be realized.
One of the worst things you will do, is, take advice form others, as, it is plain to see that it is not the answer to success in trading, even though many will try and have you believe it is, for obvious reasons, namely money changing hands.
The more "things" you introduce into your thought process, the slower you will become, and the slower you become the less opportunities you will act on, as trading is all about acting on opportunities when they appear.
I have traded with a small few people who are far better at trading than myself, and I have spoken with many people who profess to know what it takes to become successful, and in the end none of it mattered one little bit, as when I realized that what I have learned myself is far more valuable to me than anything any other person said or done.
As for trading being like a sport, another silly analogy that makes no sense at all, probably taken out of some textbook that some person read somewhere and decided to spread their new found knowledge on the internet.
The sooner one gets serious about trading, the sooner things will start to happen. If you spend most of your time talking and pretending you are someone you are not, then it is obvious that you are not going to accomplish much, apart from make a few people laugh who know what it is really all about.
I might try and get a good discussion going in this, the most important section of the whole site, but as mentioned, very few take heed of this section, which in itself shows why the merry go round keeps on going..and going..and going...
Lúidín
