- Define a goal for yourself, and stick to it.
- Your trading focus, based on your goals and your trading preference - intraday, swing or long term positional
- Risk and Money Management
.....................................................
You may have a goal clearly in mind, but it must have three important characteristics:
1) Your goal must be realistic.
2) Your goal must be attainable.
3) Your goal must be measurable.If you want to be a successful trader, the first thing that you need to do is to set your trading goals.
...........an important message even in Larry Levins "Secrets of Emotion Free Trading", which has been a good reference for me.
Just as important as setting specific goals, you must visualize yourself successfully reaching those goals each and everyday. If you can’t see yourself in your mind’s eye as a success, there is no chance you will become successful. It just won’t happen!”
Not only must you have a goal and a plan to execute on the goals for trading, you need to think of your successful future and imagine how it is! Envision it.
Break that goal into achievable milestones, like that in a project plan, like building a house. You need land, you need money, you need an architect to design it for you, you need to have the resources and time to manage and monitor its progress.
For example, you may say to yourself, that you want to see Rs 2500 credited into your bank at the end of each week as a goal for the very short term and this is what you will do:
- I will paper trade my trading method for a week or a month and see whether it delivers Rs 2500 per week?
- Then I will do real trades for a week and evaluate the results.
- Did I achieve Rs 2500 at the end of the week? If not, why?
- Analyse, paper trade, real trades, evaluate...and repeat this cycle till your goals are met and then set a new goal with a whole new thinking behind to take the progress to the next level.
Its important that you are always in control!!! In control of what? You cant control the market............There is one control you have. You can decide when to enter and when to exit. Thats the maximum you can do.control yourself!!
So you can only TIME your entries and exits and the amount of money that you play with.. You would do things in your best interest by timing your actions like :
- Not risking more than 2% of capital as loss in any given trade.
- Exiting profitable trades, once a target profit is made. And not running after the profits.
- Always working with stop losses so that you dont lose large amounts.
REMEMBER -“A person with good self-discipline but a poor trading method will outperform a person with poor self-discipline but the best trading method currently available.”
We all want those huge winning trades. But one thing we must all remember is we can’t control what the market will do, so we must be prepared for whatever it does do. Thus, if we have a good winning run of 60 points when our objective was 75, we must gracefully exit before these profits evaporate even if that means missing out on a big winner. Thats the discipline that we need!
- Your trading focus, based on your goals and your trading preference - intraday, swing or long term positional
- Risk and Money Management
.....................................................
You may have a goal clearly in mind, but it must have three important characteristics:
1) Your goal must be realistic.
2) Your goal must be attainable.
3) Your goal must be measurable.If you want to be a successful trader, the first thing that you need to do is to set your trading goals.
...........an important message even in Larry Levins "Secrets of Emotion Free Trading", which has been a good reference for me.
Just as important as setting specific goals, you must visualize yourself successfully reaching those goals each and everyday. If you can’t see yourself in your mind’s eye as a success, there is no chance you will become successful. It just won’t happen!”
Not only must you have a goal and a plan to execute on the goals for trading, you need to think of your successful future and imagine how it is! Envision it.
Break that goal into achievable milestones, like that in a project plan, like building a house. You need land, you need money, you need an architect to design it for you, you need to have the resources and time to manage and monitor its progress.
For example, you may say to yourself, that you want to see Rs 2500 credited into your bank at the end of each week as a goal for the very short term and this is what you will do:
- I will paper trade my trading method for a week or a month and see whether it delivers Rs 2500 per week?
- Then I will do real trades for a week and evaluate the results.
- Did I achieve Rs 2500 at the end of the week? If not, why?
- Analyse, paper trade, real trades, evaluate...and repeat this cycle till your goals are met and then set a new goal with a whole new thinking behind to take the progress to the next level.
Its important that you are always in control!!! In control of what? You cant control the market............There is one control you have. You can decide when to enter and when to exit. Thats the maximum you can do.control yourself!!
So you can only TIME your entries and exits and the amount of money that you play with.. You would do things in your best interest by timing your actions like :
- Not risking more than 2% of capital as loss in any given trade.
- Exiting profitable trades, once a target profit is made. And not running after the profits.
- Always working with stop losses so that you dont lose large amounts.
REMEMBER -“A person with good self-discipline but a poor trading method will outperform a person with poor self-discipline but the best trading method currently available.”
We all want those huge winning trades. But one thing we must all remember is we can’t control what the market will do, so we must be prepared for whatever it does do. Thus, if we have a good winning run of 60 points when our objective was 75, we must gracefully exit before these profits evaporate even if that means missing out on a big winner. Thats the discipline that we need!