ATTITUDE SURVEY

This survey have been taken from the “Trading in the Zone” by Mark Douglas.

Answer to below questions are my personal opinion.

I have tried to answer the attitude survey questions and those are my personal view.Just want to say this questions are so critical that they can make or mar your trading career.I have been trading for almost four year now. I have seen some success with lot of failure,until  I................

1. To make money as a trader you have to know what the market is going to do next.

No. I just need to know my edge. My edge will define my profit and Loss. Edge means tried and tested trading plan. Because I know following my plan over long period of time will automatically bring money to me.There is no way to find out what market is going to do next .

2. Sometimes I find myself thinking that there must be a way to trade without having to take a loss.
 No. There is always a Loss.  Every time my edge tell me to take position in the market .Sometime it work and some time it doesn't. An edge is nothing more than an indication of a higher probability of one thing happening over another. Remember ,probability is not guaranty. Every trade has a potential to go against you .

3. Making money as a trader is primarily a function of analysis.
No. Just follow your trading plan and ignore everything.Making money as a trader is primarily a function of following your trading plan.You only need to know your trading Plan.

4. Losses are an unavoidable component of trading.
 Yes. Every time I make entry to market, there is every chance of stop loss getting hit. However, we should have a believe over longer period I will make money by following my trading plan.

5. My risk is always defined before I enter a trade.

Yes. We should define our risk before we enter a trade .If we are uncomfortable with the risk we should simply ignore the trade and move on.

6. In my mind there is always a cost associated with finding out what the market may do next.

Yes. An edge is nothing more than an indication of a higher probability of one thing Happening over another. But at the end it is just a probability and not guaranty.

7. I wouldn't even bother putting on the next trade if I wasn't sure that it was going to be a winner.

We will never know what next trade will be winner or a loser. I need to take all the trade to make consistent money. There is a random distribution between wins and losses for any given set of  Variables that define an edge.

8. The more a trader learns about the markets and how they behave, the easier it will be for him to execute his trades.
 just need to define my edge and follow it religiously .I don’t care about anything else. Ignorance is bliss.

9. My methodology tells me exactly under what market conditions to either enter or exit a trade.
True .Trading plan define your entry ,exit and Risk management.

10. Even when I have a clear signal to reverse my position, I find it extremely difficult to do.
No. We should improve it by following our trading plan seriously.

11. I have sustained periods of consistent success usually followed by some fairly drastic draw-downs in my equity.

True.There is a random distribution between wins and losses for any given set of  Variables that define an edge.

12. When I first started trading I would describe my trading methodology as haphazard, meaning some success in between a lot of pain.
True.but later I have improved by learning and continuous improvement.

13. I often find myself feeling that the markets are against me personally.
 No -Market is not that intelligent. I just need to know my edge. My edge will define my profit and Loss.Initially I felt like market is doing exact opposite to my position.

14. As much as I might try to "let go," I find it very difficult to put past emotional wounds behind me.
True. Continuous improvement and following your trading plan will make it slowly fade it away

15. I have a money management philosophy that is founded in the principle of always taking some money out of the market when the market makes it available.
True. Just define the role of exit management (take some money out and let rest follow).

16. A trader's job is to identify patterns in the markets' behavior that represent an opportunity and then to determine the risk of finding out if these patterns will play themselves out as they have in the past.
True ..............Very ,very true.

17. Sometimes I just can't help feeling that I am a victim of the market.
No.   We can really be victim of not following our trading plan and not defining our edge properly.

18. When I trade I usually try to stay focused in one time frame.
Dual time frame guaranty better success. Always we need to have bigger picture in mind.

19. Trading successfully requires a degree of mental flexibility far beyond the scope of most people. 

 False .just follows your tested plan and ignores everything. Ignorance is bliss.

You don’t need to be intelligent to make money in market .You need to follow Tested plan over long period of time and success will automatically follow.

20. There are times when I can definitely feel the flow of the market; however, I often have difficulty acting on these feelings.
True.  I need to improve and follow our plan regularly. 

21. There are many times when I am in a profitable trade and I know the move is basically over, but I still won't take my profits.
Just define the role of exit management (take some money out and let rest follow).

22. No matter how much money I make in a trade, I am rarely ever satisfied and feel that I could have made more.
I never know what will happen next .My trading plan should define entry and exit. I will just follow my plan. Just define the role of exit management (take some money out and let rest follow).

23. When I put on a trade, I feel I have a positive attitude. I anticipate all of the money I could make from the trade in a positive way.
Feel positive by following your trading plan.

24. The most important component in a trader's ability to accumulate money over time is having a belief in his own consistency.
True

25. If you were granted a wish to be able to instantaneously acquire one trading skill, what skill would you choose?
Follow my trading plan and trade in the moment.

26. I often spend sleepless nights worrying about the market.
No.I would rather prefer  sleepless nights for improving my plan.

27. Do you ever feel compelled to make a trade because you are afraid that you might miss out?
I have got away from this by following my plan .

28. Although it doesn't happen very often, I really like my trades to be perfect. When I make a perfect call it feels so good that it makes up for all of the times that I don't.
I would like to make trade entry of my plan rather concentrating on it being perfect or imperfect.

29. Do you ever find yourself planning trades you never execute, and executing trades you never  planned?
I have got away from this by following my trading plan .

30. In a few sentences explain why most traders either don't make money or aren't able to keep what they make.
Proper money management is needed to retain the money you have or what you have earned.

Consistently follow your trading plan ……………………Success will follow.

Source: “Trading in the zone”

Trading in the Zone with these 12 steps

The following principles are taken from the “Trading in the Zone” by Mark Douglas.

Here they are in numerical order:

The 5 Fundamental Truths of Trading:

1. Anything can happen.        You have an edge and you may have probability on your side. But at the end it is just a probability and not guaranty. Lot of things which are not quantifiable can take place in market.   

2. You don’t need to know what is going to happen next to make money.  Ignorance is bliss . Just execute your edge and place the probability on your side.No Body knows what is going to happen next.

 3. There is a random distribution between wins and losses for any given set of  variables that define an edge.In other words, based on the past performance of your edge, you may know that out of the next 20 trades, 12 will be winners and 8 will be losers. What you don’t know is the sequence of wins and losses or how much money the market is going to make available on the winning trades. This truth makes trading a probability or numbers game. When you really believe that trading is simply a probability game, concepts like ‘right’ and ‘wrong’ or ‘win’ and ‘lose’ no longer have the same significance. As a result, your expectations will be in harmony with the possibilities.

4. An edge is nothing more than an indication of a higher probability of one thing happening over another. An edge  is just a likely hood  of one things over other .Probability => Quantifiable likelihood (chance) of the occurrence of an event expressed as odds. 

5. Every moment in the market is unique. It is important to remember that every moment in the market is unique. Just because the market did one thing one day does not mean that it will do the same thing the next day. The participants in the market change from day to day and even hour to hour which makes every single experience in the market completely unique.

The 7 Principles of Consistency:

1. I objectively identify my edges.  You already know what you are looking for. You should know your entry , risk parameter , profit objectives. Edge  can be combination  of any sets of pre determined variable , which have been back tested and found to give 50-55% winning trade.

2. I predefine the risk of every trade.  We know that every trade  has a potential to be a loser , so we should be pre decided about the dollar amount we are going to risk on the trade to find out whether the trade is working or not .Best time to  put a stop is before you put the trade on.

3. I completely accept the risk or I am willing to let go of the trade.  Sometime we can be uncomfortable with the dollar amount we have to risk to put the trade on . if you are not completely comfortable , then either you cancel the trade or scale back on your position to make yourself comfortable with dollar amount .

4. I act on my edges without reservation or hesitation.  Once the edge present itself just put the trade ON.We have learned, usually quite painfully, that we don’t know in advance which edges are going to work and which ones aren’t. so, I have stopped trying to predict outcomes. I have found that by taking every edge, they correspondingly increase their sample size of trades, which in turn gives whatever edge they use ample opportunity to play itself out in their favor, just like the casinos.

5. I pay myself as the market makes money available to me.  I take money out from my system after execution of 30 trades and and if I am in profit . You can have your rule .

6. I continually monitor my susceptibility for making errors. Common Errors are 

•  Refusing to define a loss.
•  Not getting rid of a losing trade when it is obviously a loser.
•  Getting locked into a bullheaded opinion about market direction.
•  Focusing on monetary value of trade instead of market structure.
•  Revenge trading to recoup a loss.
•  Not reversing a position when the market is clearly changing direction.
•  Not following the rules of your strategy.
•  Planning for a trade and then not taking it.
•  Not acting on your intuition.
•  Giving back recent gains due to over trading or inconsistency. 

7. I understand the absolute necessity of these principles of consistent success
and, therefore, I never violate them.  Read  it every day before market Opens  and follow it.

Source: “Trading in the zone”