|
PureBytes Links
Trading Reference Links
|
Tom Alexander wrote:
>
> I have a few thoughts I thought I'd share with the group regarding traders
> and trading. I have had a unique opportunity because I'm a broker to
> observe many, many different trading styles. I also have friends who are or
> have been brokers and through the years their experiences have very closely
> matched mine in terms of the activity and habits of their clients. This has
> been the most valuable experience one could hope to have to learn to trade.
> I have almost literally been looking over the shoulders of traders for 13
> years and I want to share some of what I've learned and observed.
>
> My clients have been as diverse a group as you might well imagine, coming
> from all walks of life and backgrounds. As a group they have been very well
> educated, successful people in most of the ways we typically gauge success.
> These people have collectively read, studied, subscribed to, and attended
> more seminars and trading courses than one human could in a lifetime. Some
> of these people are advisors in one capacity or another to traders. As
> traders, some of the advisors are successful and some are not.
>
> I have some very successful clients, and a lot of not so successful
> clients. I have never had a client make a million dollars. I have had a
> client lose more than a million dollars.
>
> Again, I'm not trying to present THE answer (I don't have it). These are
> simply observations of the collective experience of a large and diverse
> group of traders. Some of these traders are long-term traders, some are
> short-term traders. I am not aware of anyone who used or is using a purely
> mechanical system.
>
> The successful traders are those who have designed a system or method that
> fits within their personality. They could care less if I'm doing something
> that they are not that makes me money.They seem to have learned along the
> way that it has to be right for them or it won't work, regardless of how it
> works for someone else. Whatever method or system they employ, they do so
> with consistency and discipline. They trust themselves. They are not always
> in a trade. Even the successful daytraders do not trade every day. They use
> various methods but almost all of the methods are very simple. Their money
> management skills are excellent, meaning once they are in a trade they know
> how to manage it.
>
> The "strugglers" are comprised of beginning traders who are various stages
> on the learning curve and those that have a considerable amount of
> experience but have yet come to grips with what works and what doesn't.
> There is little difference in terms of behavior between these two groups.
>
> Both groups jump all over the place and never settle on one style or
> method. Neither group has developed the discipline or patience that is
> vital if one is going to be successful. They tend to overtrade and are very
> concerned about missing a potentially good trade and as a result take a lot
> of bad ones. They have a difficult time with losses and tend to look at
> each trade as a discrete event rather than one event in an ongoing business
> where the result of any given trade is insignificant to the whole. They
> spend a lot of money on books, advisors, newsletters, systems, and computer
> programs looking for the answer. They think that more is better: more
> computers, more indicators, more screens, more advisors. The simple is
> eschewed.
>
> The strugglers that are successful in making the transition finally reach
> the point where they realize they have to simplify. Once this point is
> reached their confidence builds, their focus narrows, and the other
> necessary qualities such as discipline and patience begin to evolve at a
> rapid pace. Their search for what works becomes less externally oriented
> and more internally driven. In other words, they become more concerned with
> how they work as opposed to how a system, indicator, or computer program
> works.
>
> The ones that continue to struggle do so because they are forever
> attempting to put a square peg in a round hole. They never reach the
> conclusion that just because someone is successful with a method it does
> not automatically follow that anyone can achieve the same success with that
> method. They continue to try every method, system, indicator, guru,
> computer program, etc., that is even rumored to be the road to riches.
> Their search is entirely external.
>
> Hopefully this will in some way be of help to those who trade, regardless
> of where they may be on the learning curve. All the traders I have known,
> myself included, have been a struggler at one time or another. It is a
> necessary and in my experience unavoidable part of the process of learning
> to trade. The one piece of advice I'd like to end with to those that are
> still struggling is to begin immediately to try to simplify your trading.
>
> Regards,
>
> Tom Alexander
>
OUTSTANDING! I laughed all the way through. How could you know me so well?
But yes, I've observed the very same patterns over and over again, among all
traders - and brokers - I've worked with / for / next to, and there are quite
a few from all around the world. It has also been valid for me. My previous
posts were all intended in that direction, but yours comes across crisp and
clear!!!!
friendily,
Gwenn
PS: Yes, I am back, after two days of being shut out, but promise, I'll be
less of a nuisance. I had only temporarily forgotten that one essential rule:
"One shouldn't give to anyone who did not seriously ask for it." And I stress
"seriously". Many want to know, but not to find out. Ooops, here it starts
again...
Thank you all as well for the support you mailed me privately. That was very
kind, and I appreciated very much.
Gwenn
|