Wednesday, February 4, 2009

The psychological nuances of trade


Many traders quickly realized that in addition to knowledge of the winning strategies, systems, and methods of managing money, shopping success depends on your psychological attitude. If you're just a beginner trader, where you take the initial confidence to open a position? How do you do in the event of failed deals, not to push himself even deeper into the pit? If you are in a hole, what are you doing to get to it? As experienced traders raised the ceiling of profitability?

Trade - is focused on the effectiveness of the discipline. Tension and psychological pressure can affect your ability to work and influence in your state. Much of what has been learned about reaching peaks in business and in sport that can be applied to the sale. But before considering some of these factors, let us first explore than trade differs from other types of businesses.

1. Intellect has nothing to do with your ability to be a trader. Success is not the result of how fast and nimble you are, or how skillfully you apply academic knowledge. It is difficult to accept in a society which requires a premium for intelligence.

2. There are no customers and relationships with customers, build every day in your business. The relationship with the client, traditionally important in American species of business, have little in common with the trader's profitability. Each day starts with a clean sheet.

3. 5-8 The traditional rules of business ethics do not apply in this business! Trader can sit in front of a screen all day, waiting for a familiar form of graphic models, and nothing happens. A trader is tempted to make a deal just to feel that he is doing something. There is also the issue of standing for hours in research, not revealing anything as a result of not receiving anything for their work. Also, if a trader is working too hard, he is in danger of "burn." And what about those months where 19 out of 20 days were profitable, but the trader loses all of it the result of one or two bad days? As a trader can calculate its effectiveness in these situations?

4. If you were to spend time, energy and emotions for the business development and retreated at the last minute, it will be deemed a failure. However, you should be able to spend time and energy to study ideas of trade, and yet still be able to change at the last minute. Market conditions change and we can not hope to anticipate all factors. Out of a bad deal with a small loss should be viewed as a great success!

How can you describe a successful trader? It must feel good and love the trade. You can make several small transactions a year as a hobby, get a very modest profit, and be very successful because you were fun. There is also an aggressive traders, who were "noble" years, but in the end - the disruption, impaired health or unhappy life of all the stresses to which they expose themselves.

The principles of successful work
The first principle of successful work is the production of pleasure in the first place. Dispose of the pressure from your head. Forget the statistics, the percentage recovered, relationships win / loss, etc. Traders in the Hall make a lot of transactions during the day, but the whole question is whether they are in the black at the end of the month.

Do not think about trying to win the game - it is inherent to any sport or focusing on the implementation of discipline. Being involved in the process technology, a moment - in other words, here and now! Trader should focus on the current market price activity. A good analogy is a player in professional tennis, which focuses only on the ball. He will probably lose half the balls that he will play, but he did not allow myself to worry about that, he will win or lose EST. He must be confident that focusing on the technology game, the strength of his game will prevail and he will be able to outflank his opponent.

The second principle is to the success of self-confidence, its methodology and its ability to succeed. Some people are confident in ourselves from nature. Other people are able to translate the success of the other areas of their lives. Maybe they were good athletes, musicians or scientists. There is also an old-fashioned way to work hard to gain confidence. Start with research and development of various systems or methods. Change the system and modernized to make them your own. Examine the charts, yet you do not remember any significant fluctuation up or down. Self-confidence arises in the development of a methodology in which you believe.

Focuses on the technical conditions. Have a clear plan for trade. Do not listen to analysts, a broker or a friend. To be a successful trader, you must do your own analysis and be confident in your trading plan.

Analyze the markets when they are closed. Your job during the day is to monitor the market transactions and management positions. Traders should be similar to fighter pilot - make quick decisions and have quick reflexes. Their plan of attack is already predetermined, yet they must be prepared to suspend its mission at any stage of the game.

Because you have thrown away the win from the head, then you must also remove the loss of your consciousness. The bad trade does not mean that you missed your day. From bavtes of the problem quickly and start making money again. This is akin to fraud in the diet. You can not eliminate the damage, as had been done. However, this does not mean that you have lost your entire diet. Go back to the rate of diet and everything will be fine.

In this regard, the better you are able to remove the emotion of the day, the better for you. A proportion of exclusion adds a healthy dose of objectivity.

Trade - this is a good business because the markets are closed at the end of the day (at least most of them). This gives you a zero starting point to begin the next day with a clean sheet. Every day - a new day. Forget what you've done a week ago. Matter is that you are doing today!

Sometimes, what happens during the day, boils down to knowing yourself. You are relaxed or diverted? Are you ready or not? If you can not trade on that day - no deal! - And do not try to over-analyze the reasons why or why not. Do you think your child psychology can help you trade? Nonsense!

The third important component in achieving a successful work - this is relevant. Attitude is how you act when the inevitable adverse situations that occur in the markets. Attitude also is how you cope with your daily routine, with the constant "2 steps forward and 2 back." Every professional has gone through a long time, rocking "backward-forward." The sharp slowdown is inevitable, since it is impossible to stay on top of 100% of the time. If you choose from the pit, regardless of how long it took, you already know what you can do it again. If you've done something once, it is possible to repeat. This knowledge is a powerful weapon and help make you a much more powerful trader.

Good deals are not always udayutsya. Good trade - the one that has a chance of success, but that does not mean that it will always be wrong. People who have a theoretical foundation for trade, it is well understood. Statistics are important when considering the sequence of numbers. For example, in professional football, not every game should end in victory. What percentage of games you must win to go in the play-offs? This number is much smaller than most of us are prepared to accept in our own ratio of wins to losses!

Interesting question: You should consider the trade logically or psychologically? In other words, each transaction must be considered individually? Theoretically, yes, but in real life does not always happen. Trader is likely to be managed in a different position depending on whether the previous transaction is a winning or losing.

How do I know when to take profits from a good deal? You must first ask yourself how you are greedy, or how much money you want to do? Also, your desire is linked with "a sense of return, or an objective level?

Successful traders are very concerned about the protection of their capital. They are more likely to come out of the deal, which does not work immediately, as this transaction will give rise to doubts. The best deals are working now!

Ok. In reality, each trader has made the deal unprofitable. What do you do when in such situations? The first thing you should do - is to immediately get rid of half of your position. Reduce size. You immediately take action, rather than falling into stupor. You reduce your risk, and you have shifted the psychological balance in the situation "win-win." If the market turns, you could still save a portion of your position. If it keeps moving against you, your loss will be more manageable. Usually, you'll regret that not all closed position to the first order, but not everyone is able to do so.

Successful deals are helping to further trade. Good to start the day with the withdrawal of profits. This gives you more space for the next transaction. Psychology of the day immediately changed in your favor. For the same reason, it is important to get rid of Losing transactions a day earlier as you do not have to start the day with them. This is desirable when there is a choice and you want to use it to their advantage.

Removing a small profit is the easiest trade. The secret is to enter and leave the market as quickly as far as possible. Open position in the direction of the market or the last push of momentum. The shorter period of time during which you are in the market, the easier it is to achieve a successful trade. Of course, the profits when such a strategy is not significant enough to earn a living, but remember that the goal is to start the day with a good note.

If you consistently follow their methods and make money, how you can make more money? You must increase the number of transactions without increasing leverage. In other words, do not try to increase the size of the position, instead, deal a large number of contracts. Need some time to increase your account or the number of capital under your control. Proper tools can be key to your success and longevity in this business. Most traders who are faced with trouble, with too much attitude. Size affects your objectivity. Your main goal should be to stay in the game.

Most people react in another way, if they are under pressure. They tend to be more emotional and malleable. Their tension is growing and judgments are often worsened. You can be a brilliant analyst, but a bad trader. Consistency is much more important than brilliant talents. Try to be consistent in what you are doing and get rid of the expectations of the results of your work.

Spravtes Game
The final key to the attainment of psychological skills in the trade is confident that you really can do it. One is able to be a successful trader if he truly believes that he can. You must believe in the virtue of certainty. If you are skeptic or a doubt, try to pretend that you can do it. Keep talking yourself that you will do so even if you need five years. If you desire a very strong person, it will always find ways to implement.

If you recognize yourself that you really no desire to win this game - do not try to sell. Too easy to lose big money. Many people think that they would love to trade, when they really do not. This is boring from time to time, and lonely during the day. Markets are not logical or fair play. But there are a large number of irrationality and models that can be used, and so will always be.



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