Your Single Best Piece of Advice

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Anita V

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Hey guys and gals,

I've been doing research for the past couple months, I've gone through countless forums, posts and even books on fx trading so far. Now I'm wondering, if you could give me only one single piece of advice before I start trading live what would it be? I haven't chosen a broker as of yet, so I suppose you could give me your recommendation on that but I'd prefer almost anything else since I've done my work on that already. Who better to give me tips than a bunch of experts? They say that knowledge is the best weapon you can arm yourself with starting in this industry and with time comes experience. I'm trying to gather as much of that prized knowledge as I can before I start!

PS. I do plan to open a practice account and to test all of my strategies diligently before moving to the next step. I'd just like to glean from the collective expertise as much as I can while I await that next challenge.
 
Anita V said:
Hey guys and gals,

I've been doing research for the past couple months, I've gone through countless forums, posts and even books on fx trading so far. Now I'm wondering, if you could give me only one single piece of advice before I start trading live what would it be? I haven't chosen a broker as of yet, so I suppose you could give me your recommendation on that but I'd prefer almost anything else since I've done my work on that already. Who better to give me tips than a bunch of experts? They say that knowledge is the best weapon you can arm yourself with starting in this industry and with time comes experience. I'm trying to gather as much of that prized knowledge as I can before I start!

PS. I do plan to open a practice account and to test all of my strategies diligently before moving to the next step. I'd just like to glean from the collective expertise as much as I can while I await that next challenge.
Click to expand...

Don't bother. Get a job.
 
Discipline.

Risk reward,a trading plan and trade size are key but the single most important thing is discipline because without it none of the others are possible.
 
^Similar to above.

"The most important rule of trading is to play great defense, not great offense. Every day I assume every position I have is wrong." Paul Tudor Jones
 
Thanks, shadowninja, tim3, Hoggums. That all seems like sound advice. I am a very disciplined person and I'm really just dipping my toe in the pool so to speak. You've been very helpful. It's sounds very wise to think of what you COULD lose instead of what you might POSSIBLY win as a mindset.

As for brettus and Black Swan... it's a good thing I'm not coming here for encouragement, just for valuable information. Not very heartwarming for a new member of this forum! lol

Forker, that kind of made me laugh.

Anyone else have any input?!?
 
Don't take advice on forums too seriously. Most of it is likely groundless beliefs rather than experience-based wisdom. At best take everything as a suggestion and accept nothing without testing and confirming it for yourself.

You can waste an awful lot of time following false trails and reaching dead ends. Though of course this could be seen as an essential part of the learning process.
 
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This is the second time I've heard not to take advice on forums too seriously and I'd have to agree, especially with posts pertaining to people's schlongs! But there is something to say about collective intelligence. Everyone can't be wrong and it's much easier(maybe not as lasting) to learn from other people's mistakes. That's the whole reason why people have mentors!
 
Anita V said:
This is the second time I've heard not to take advice on forums too seriously and I'd have to agree, especially with posts pertaining to people's schlongs! But there is something to say about collective intelligence. Everyone can't be wrong and it's much easier(maybe not as lasting) to learn from other people's mistakesThat's the whole reason why people have mentors!
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Surely, for the markets to keep functioning, Everyone must be wrong.

Or rather, the majority must be wrong.

If the majority all made the same 'correct' trading decision at the same time, most of them would lose money in the process.

I expect the minority to be correct. I can't see how the markets could function any other way as it would mean more winning than losing and that's impossible.
 
Mathematically you're entirely right, for someone to win, a corresponding person or people also have to lose. But for certain people to consistently be profitable there must be something that is "right" or "works". Hence by me saying that EVERYONE can't be "wrong", I meant that at least someone must be "right".

Does that make sense?
 
Yes it does make sense.

What you need to ask yourself - are the opinions on trading sites & in trading books 'mainstream' or not?

If they are mainstream - i.e. what the majority try to use, then is there a reasonable expectation that they would work?

Some will say that of course these well documented and discussed trading methods work but the people that can't make them work have issues with psychology.

When you hear someone discuss something that is widely known and easily seen, you have to ask yourself if it is realistic that the market leaves such a large and exploitable edge for the majority to profit from. You also have to consider who is on the other side of those trades and why they can't see what is explained in a thousand or so trading books.

Perhaps the answer is that trading web sites are the home of those in the know and the rest of the retail trade community is just pushing buttons at random...
 
DionysusToast said:
Surely, for the markets to keep functioning, Everyone must be wrong.

Or rather, the majority must be wrong.

If the majority all made the same 'correct' trading decision at the same time, most of them would lose money in the process.

I expect the minority to be correct. I can't see how the markets could function any other way as it would mean more winning than losing and that's impossible.
Click to expand...

mmm, doesn't it depend on money flow?

A static market (in terms of money flow) is a zero-sum game where where overall win = overall loss. That's not to say the number of winners must equal the number of losers since one big winner may win at the expense of a hundred small losers.

However, when new money is pouring into the market there is a positive money flow and it is not a zero-sum game whilst those conditions maintain. Thus, in terms of realised profit or loss, overall wins can exceed overall loss. Once again that's not to say that the number of winners can be greater than the number of losers, for the same reason as before, but it's not impossible.

good trading

jon
 
Agreed Jon - but realised profit and loss in the short term is not what trading is all about, right?

It's about making money in the long-term.

In the type of market you defined, you'd probably need the following:
- Recognise the type of market you are in and trade according to that
- Capitalize on it as much as possible
- Realize you will have some losers when that period ends
- Have some overall hypothesis of the markets to recognise when the period has ended

If not, if you just used a static set of methods - such as buying an MA crossover, you might be quids in with complimentary market conditions but have no clue what to do when conditions change.

I still think that if the majority all do the same thing, the inevitable result is that they will lose.
 
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