motivation

Trading
is not all fun and games. Traders do not make money on every trade,
most don’t even make money on half their trades. It is not like other
careers, jobs, or hobbies where you work and then get paid automatically
for your time regardless of performance. A trader’s pursuit is more
like the life of an entrepreneur. Our trade entry or idea may work or it
may not. The equity, option, or futures contract we just bought may go
up in value or it may fall lower. After many years of hard work we may
have enough capital to pay off our house or lose $50,000 of our hard
earned money. We may become a millionaire in a runaway bull market or
waste five years of hard work with nothing to show for it. A trader’s
path is dependent on the market’s price action that we have no control
over. We control the amount of pain we experience in our trading through
our position sizing and discipline for following our quantified trading
system.
Here are 10 painful aspects of trading and what to do about them.
The pain of losing money. (Trade smaller so it is much less painful, and just one outcome of the next 100.)The
pain of being wrong about a trade you were sure about. (You lost simply
because the market wasn’t conducive to your particular trade, trend
followers lose money in choppy markets, swing traders lose money in
trending markets, the market picks the particular winning trade not
you.)The pain of a draw down in
capital. (Even the world’s best money managers do not continually hit
all time equity highs. Your path may look like this $10,000 to $20,000
to $15,000 to $25,000 to $20,000 to $30,000 and then the climb into six
figures and beyond).Consecutive
trading losses hurt. They make you doubt yourself, your method, and
your system. (You need to remember your winning trades, your winning
years, or your proof of back-testing, or paper trading of your method’s
profitably.)The embarrassment
of public losses. You told everyone who would listen about a great trade
entry, and you were wrong. (Never be overconfident in any trade, but
always be sure of your stop loss. Always be uncertain in your trade
winning or losing, just follow your plan).The pain of admitting you were wrong. (Cut your loss and move on to the next trade, trade reality not your ego).Losing
paper profits, you are up $1,000 on a trade then a massive whip saw
takes back those profits in one move. (Take your trailing stop and move
on to the next trade, there is truly no reason to cry over spilt milk).You
are following a guru and come to realize he can’t predict the future or
make you easy money, you are going to have to build your own system and
write your own plan. (You stop following gurus and look to learn how to
trade all by yourself).You
take a position that meets all your entry guidelines and then it hits
your stop loss. (Follow your plan, exit the trade, and say “next”).You
start trading a system that did amazing in back-testing and promptly
lose 10% of your account in a draw down. (You have to double check to
see if you made any mistakes in your research, if the method is valid
then stick with it so it can win in the long term, you may need to make
slight adjustments in position sizing or stops to account for volatility
that you may have missed).
Whatever
the pain, just don’t quit, there are great potential rewards to be
found in trading a quantified and profitable system over the long term.
#Motivation #howtomakemoney #BTC $BTC
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