Answer to below questions are my personal opinion.I keep on answering these over month to keep my understanding intact.if we answer them honestly ,above questions probe our trading character and teach what nobody ever can .........
1. To make money as a trader you have to know what the market is going to do next.
Sep 11, 2011 => 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.
Feb 12,2012 => No. I just need to know my plan which define my Edge,Risk Parameter,Money Management,when to take profit.Because I know following my plan over long period of time will automatically bring money to me.
2. Sometimes I find myself thinking that there must be a way to trade without having to take a loss.
Sep 11, 2011 => 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.
Feb 12,2012 => Every time My edge not work I have to take a loss.There is always a risk associated to find what market is going to do next.
3. Making money as a trader is primarily a function of analysis.
Feb 12,2012 =>if we are making ananlysis to avoid risk then certainly Making money as a trader is not primarily a function of analysis.
4. Losses are an unavoidable component of trading.
Sep 11, 2011 =>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.
Feb 12,2012 =>Trading in its simplest form, is a pattern recognition
numbers game. We use market analysis to identify the patterns, define the risk, and determine when to take profits. The trade either works or it doesn't. In any case, we go on to die next trade. It's that simple.
There is no corelelation ship between pattern and risk / pattern and profit taking.Everytime we will have unique risk and profit taking levels.so chances of stop loss getting hit is more.we cannot eliminate risk from trading.
5. My risk is always defined before I enter a trade.
Sep 11, 2011 =>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.
Feb 12,2012 =>Risk is a reality in trading,so we cannot eliminate it.If we are uncomfortable with the risk we should simply ignore the trade and move on.We can also decrease position size to bring Risk at comfortable level.
To whatever degree you haven’t accepted the risk, is the same degree to which you will avoid the risk. Trying to avoid something that is unavoidable will have disastrous effects on your ability to trade successfully. – Mark Douglas
6. In my mind there is always a cost associated with finding out what the market may do next.
Sep 11, 2011 =>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.
Feb 12,2012 =>we have to always consider risk reward at every points.if risk reward is not favorable we need diminished position(profitable trade).
Sep 11, 2011 =>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.
Feb 12,2012 =>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.
8. The more a trader learns about the markets and how they behave, the easier it will be for him to execute his trades.
9. My methodology tells me exactly under what market conditions to either enter or exit a trade.
Sep 11, 2011 => Trading plan define my entry 1. Entry 2.Risk 3.Money management 4.when to take profit.
Feb 12,2012 =>Trading in its simplest form, is a pattern recognition
numbers game. We use market analysis to identify the patterns, define the risk, and determine when to take profits. The trade either works or it doesn't. In any case, we go on to next trade. It's that simple.
Sep 11, 2011 =>No. We should improve it by following our trading plan seriously.
Feb 12,2012 =>My trading plan will take care of it.
Sep 11, 2011 =>True.There is a random distribution between wins and losses for any given set of Variables that define an edge.
Feb 12,2012 =>My trading plan will take care of it.
Sep 11, 2011 => True.but later I have improved by learning and continuous improvement.
Feb 12,2012 =>My trading plan will take care of it.
13. I often find myself feeling that the markets are against me personally.
Sep 11, 2011 => 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.
Sep 11, 2011 =>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.
Sep 11, 2011 =>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.
Sep 11, 2011 =>True ..............Very ,very true.
17. Sometimes I just can't help feeling that I am a victim of the market.
Sep 11, 2011 => 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.
Sep 11, 2011 =>Dual time frame guaranty better success. Always we need to have bigger picture in mind.
Sep 11, 2011 =>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.
Feb 12,2012 => True. Need courage to follow your plan in tough market conditions.
Sep 11, 2011 => True. I need to improve and follow our plan regularly.
Sep 11, 2011 =>Just define the role of exit management (take some money out and let rest follow).
Sep 11, 2011 =>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).
Sep 11, 2011 =>Feel positive by following your trading plan.
Sep 11, 2011 =>True.
Sep 11, 2011 =>Follow my trading plan and trade in the moment.
Sep 11, 2011 =>No.I would rather prefer sleepless nights for improving my plan.
Sep 11, 2011 =>I have got away from this by following my plan .
Sep 11, 2011 =>I would like to make trade entry of my plan rather concentrating on it being perfect or imperfect.
Sep 11, 2011 =>I have got away from this by following my trading plan .
Sep 11, 2011 =>Proper money management is needed to retain the money you have or what you have earned.
