As our mentor has a possible whiplash, (a fibro pain in the neck) I have offered to write his post today as he has great difficulty holding his head! Last night on the webinar for his first batch of students to test his revolutionary teaching method, he was in agony to be coherent.This suggests to me to touch on his new method which may help both newbies and advance traders.Through his avid reading of trading books, our mentor stumbled across a new way of teaching his students as it is well accepted that only 10% of traders make it, in spite of attending good seminars. He has therefore initiated this special webinar with a test group and the results are amazing even before the six weeks of intensive tuition is over. This method of teaching may increase the percentage of success rates among traders. Let us wait to read about the results in due course from our mentor himself. Meanwhile, it may be worth reinforcing the theory of what would contribute to success to traders, especially to novice traders.
Dr Brett Steenbarger in one of his old posts last year mentioned five qualities that he would expect of a successful trader, such as, the five Capacities:
- Capacity for Prudent Risk-taking.The young successful trader is not afraid to go after markets aggressively when the opportunity presents itself.
- Capacity for Rule Governance. The young successful trader has the self-control to follow rules in the heat of battle, such as rules of position sizing and risk management.
- Capacity for Sustained Effort.The trader uses productive time to do research, preparation, work on himself, outside of market hours.
- Capacity for Emotional Resilience. All young traders will lose money early in their development and experience multiple frustrations. The successful ones will not lose self-confidence and motivation in the face of loss and frustrations.
- Capacity for Sound reasoning. The successful young trader exhibits an ability to synthesize data and generate market and trading scenarios.
The Conclusions are: the successful developing traders approach their work with some kind of humility, not knowing all and not pretending to know it all. They absorb wisdom from mentors and markets, getting out of bad positions by acknowledging they are wrong.
The trading journals of potential successful traders will gauge the amount of time they spend outside trading hours with entries about markets and about their feelings with scenarios, goals and feedback. Even when not trading, the good ones watch markets closely while the less successful ones hardly watch the markets when they have no positions.
Dr Brett Steenbarger sums up: ”Effort alone won’t make a trader successful, but lack of it will almost certainly ensure failure.” My own conclusions: In a nutshell, preparations in the form of selective readings for fundamentals, and chartings for technical analysis, to find a high probability of success for a trade is the norm.
Journaling as the trade is taken to its exit will complement one’s holistic approach to trading well.
Ana aka IDkit
Ag Moderator
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