So I cannot state that I have been trading all my life, as I believe nobody can.
There is always a beginning, and when you start you are exactly like anyone else
starting something: doubtful, confused, maybe a bit clumsy, and if you add some
insecurity, the recipe is made.
By 2009, in the 12 years since I started trading, I had seen at least 3 important
crashes on the stock exchange: the one on the Japanese market, the 9/11 crash
and, finally, the one that involved the whole financial world and is still having an
impact today (2010) all over the world. The beginning is the first phase, the one that is for brave, passionate or simply
curious people, but the results fill the white pages of your own story only because you started one day.
careers, why should a trader not face any?
The first difficulties are those that define the boundary between earning and losing
money.
If we think about this, these are the most important difficulties and those which will
determine whether the trader succeeds or quits.
The trader who quits is the one who is tired of frustrations and failures or the one
whose capital has been reduced to zero by the number of failures .
But there also are traders who operate for years and then, facing a long-lasting
period during which they lose or do not perform, prefer to quit because they have
lost confidence in trading or in themselves. Losing confidence in oneself or in the
trading world is the biggest reason for failure for those who have achieved some
results over a long or short period. But then fall out of love with trading when facing a difficult test. The thing is, those people did not think they would still have to face
such a trial after quite a long successful period in trading.
Difficulties have existed, do exist and will always exist even in the life of a super
trader who has faced the market for years and managed any amount of money.
We cannot know what we are not prepared for until the day when, unexpectedly, it turns up at our door.
Achieving success in life at a certain level is never due to fate.
And I’m not talking about being the first in sport or in a particular profession at world
level.
I’m simply talking about achieving results above the average or at an unusual level.
Average people get scared, feel fear, anxiety and frustration.
Successful people feel the same emotions, otherwise they would not be people.
The difference lies in the fact that facing the same feelings, successful people do
not give up.
Often people confuse enthusiasm for reaching a goal with a consciousness of the
result.
If I’m conscious of the result and of the goal I want to reach, I will remain focused on
it even in difficult moments when enthusiasm decreases.
If I live pushed by enthusiasm and not by determination and consciousness of the
result, a gust of wind coming from a failure or from any kind of problem will be
enough to shake my certainty together with my enthusiasm and everything that
follows. Success is not 100% enthusiasm, and even successful people experience
discouragement but they do not give up disheartened in the face of an obstacle.
There are no obstacles that can stop successful people, and maybe this is the only difference between a successful and an average person.
When I do open an operation I ask myself what I will feel if this operation loses and I
decide to accept this feeling from the beginning.
In this way I become conscious of the risk and I accept it.
The perception of risk is always higher than the real risk.
When a person is “risking”, he or she experiences feelings of “fear” that link the risk
to the conscious and unconscious memory.
For this reason, if I risk being knocked down by a car I experience a temporary
shock which, after the event, leaves me completely immobilized or makes me feel
sick with fear.
The “fear” remains and over time it will influence my future behaviour in relation to
similar situations, when it comes back to me or when I live through it again in the
future. When you lose or risk losing, you also experience a “fear” that will go with you in
your conscious and, above all, unconscious memory.
You will live through this uncomfortable feeling again every time you risk losing
money and this quite heavy, unpleasant feeling could provoke a reaction of refusal to trading, where every day and in every single operation you risk losing money.
To admit one’s faults is a sign of maturity and to understand that faults are part of
the way to success is an unavoidable step for the trader’s career.
The most interesting observations we should make are about the emotions felt after
a losing operation.
The first losing operation is normal, the second is annoying, the third makes you
angry and after the fourth, you start losing confidence in the method or in yourself.
And it is at exactly this point that the desire comes to recover the losses, maybe
with only one right operation.
From the probability point of view, you put yourself in a situation which is more and
more uncomfortable and difficult to satisfy.
If the fifth consecutive loss also arrives, usually the extent of this last one is bigger
than the sum of the previous ones, because of the higher amount of money you
invested or the higher risk situation you exposed yourself to, in the hope of
recovering the first four losses. The fifth loss exceeds the stress levels that the trader had fixed in advance and
furthermore it goes against the estimated acceptable risk ,because the trader was
not prepared to accept that fifth loss.
At this point the trader goes into shock and stops for a few days before regaining
confidence or before being simply drawn back by a dependence on the “gaming table”.
difficult.
For this reason, above all if the operativity is not intraday based but on a multiday
base, the balance has to be done monthly or quarterly.
If the quarterly balance is negative you need to ask yourself some questions about
the method or your personal discipline in trading.
If the problem lies in the method, because it is unable to perform in that particular
market phase, obstinacy is the worst path to follow.
If the problem is lack of discipline, I suggest you take a holiday.
These moments, when you lack results and you need a break, are the most difficult
to face because at this precise moment of wanting redemption and recovery, the
trader should stop.
At this point ego and obstinacy come into the game and the trader would like to
continue on his nerves.
Stopping could be seen as fear and the trader does not want this for him- or herself:
fear is unacceptable. In reality a degree of humility never hurts and a break to reflect could be more
valuable than any other solution.
The backtest simulation, like a demo trading account, is a very good solution to
regain confidence and to keep on training or to test your own method during an
unsuccessful phase of the method itself.
To simulate without money allows you to draw more reasonable conclusions about
the operativity, exactly when the results are not those you were expecting and the loss of money could invalidate your rationality in analysing the problem.
- What do you feel reading this phrase?
Maybe the push to try and win, too?
“The pleasure of an easy win”.
- What do you feel reading this phrase?
Are you already feeling lust for the possession of money?
But not the money you sweated for and worked for, the money you got without
doing anything and that has an immeasurable value.
The money that falls at your feet and you did not have to commit for.
The money that changes your life in a moment because fortune choose you.
“Do you feel lucky today?”
- What do you feel reading this phrase?
If you wake up in the right mood and you go to have breakfast in a café, would you
not invest at least 10 € on a lottery ticket? If it is luck and the feeling of it being "the right moment" which is driving your
choices, you will probably have disappointments of huge proportions.
It is through emotions that people choose, but you do not have to confuse emotions
with luck. “Win for life, happy and lighthearted”
- What do you imagine reading this phrase?
Not having problems any more?
Not depending on anything or anybody?
Not needing money any more?
You can win all your life at a cost of only 1 €.
It really seems that with the financial crisis, the income from lotteries and gambling
has increased out of all proportion. If the probability of winning is very low and the
money usually ends up in the hands of the Government, why then do so many
people decide to gamble even if they know they will be throwing their money away?
This is the reason why the slogans I reported above are the true luck of the
marketing companies that look after the lotteries and the gambling industry’s ad
campaigns, and especially the Government’s coffers.
If this phenomenon did not constantly increase, the Government probably would not
be able to keep its public debt at an acceptable level.
Money coming from gambling actually represents capital which the Government
cannot give up without having to create new taxes or new more restrictive
measures. If, starting tomorrow, “everybody would stop” gambling and the Government then
decided to increase taxes to compensate for lost revenue, a “civil war" would probably break out.
sympathy with them, forget about trading.
Buy a lottery ticket, so that you won’t be one of those people who say you cannot
make money trading.
The attitude to trading cannot be the same as the attitude to gambling.
Traders would not be successful people if they believed they were lucky or if they
approached this profession like you approach a casino.
I understand that these simple observations could seem stupid, but the failure of a
trader often stems from exactly this sort of thing.
These are the same phrases and slogans that attract gamblers and stimulate the
minds of those starting up in trading.
So be careful and try to understand if your approach is the one of a trader or rather that of a gambler.
Believe in yourself.
Look for an intelligent trading method, test it and start believing in the method itself.
Once you overcome those three steps, start trading and never, for any reason,
doubt yourself or trading.
Only in this way will you belong to the group of people who have achieved success
with trading, without paying any attention to the people who told you to be careful or laughed at you because you chose to become a trader.
