Master the art of trading

Simon BrownJustOneLap.com

SimonBrown.co.za@SimonPB

18th September 2012

Trading is easy

Stages of a trader•Unconscious Incompetence

•Conscious Incompetence

•Conscious Competence

•Unconscious Competence

Losing money

Being wrong

Desire•To be right

•To confirm ones view

•To get positive feedback from the market

External fearCaused by something outside of you which you are strongly motivated to avoid.

Example: being wrong, losing money

Internal fearSomething inside of you that you link to a negative emotion.

Example: being wrong, losing money

BUT•Life rules and trading rules are different

•We are wired for life rules

•Have to wire ourselves for trading rules

What to measure•Measure success by what we can control•Discipline•Consistency•Monitoring trade•Exit (stop loss)We can not control winning or losing

trades

How to measure•Generate trade•Determine exit strategy•Determine trade size•Enter on confirmation•Monitor trade & stop loss•Exit as planned•Keep a journal

What to loose•Losing trades are a fact of trading, a cost of doing business•Start up capital

•Be comfortable with the potential loss before you enter

What to loose•Stop loss determines Rand risk per trade•Be comfortable with this

•Worse case of 20 losers in a row?

How to trustDiscipline requires trust•Eyeball the system on a chart (at least 20 trades)•20 paper trades•20 real trades with small amounts

•Than the real deal

Greed

Further reading•Trading in the Zone•Mark Douglas

•Mind Power•John Kehoe

Re-cap•You can’t trade with fear•Know how to measure•Accept potential losses•Trust your system

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Master the art of trading

Simon BrownJustOneLap.com

SimonBrown.co.za@SimonPB

18th September 2012