Discipline in Trading and Investing

The only thing I can think of that most affects both trading and investing has to be self-discipline.

Being disciplined is fully 50% of the job of trading or investing. I do not care how good your trading system is , without the discipline needed to the system you do not have much of a chance of success to follow . To your objectives in meeting

It does not matter how big a planner or organizer , you are without discipline your plans will shed . Likely fail fruit
Discipline implies self-control and self-control keeps your ego . If you want to succeed , you must learn to trade without your ego get in the way .

Do not be fooled . Self-image of a person should be separated from its trade or invest . When personal esteem becomes entangled with your business activities , it demolishes not only your best trading or investing purposes , but it also damages your self-esteem .

You hear and read about great traders and investors who have done amazing things . They talk about how great they are . They talk about " The Big " trades they made . They talk about " Big" numbers. It derives from their already oversized ego.

Do not be fooled . Sooner or later , there are " big downfall . " It's part .

For a moment , let's look at the results of what a huge ego can do . With his big ego , Nick Leeson brought Barings Bank . Victor Niederhoffer ran his fund into a deficit . John Merriweather was so sure would work , that of his strategies he ended threat to the health of the entire banking system by betting more than fifty times its capital that he could predict , without any possibility of a loss , the direction of the various bond markets.

If we study the examples of these three men , there seems to be a pattern of temporary real success followed by a collapse for themselves and for those who are caught in them follow blindly.

Here are the types of problems arising from putting your ego in the mix .

- Not put into it : You do not want to be proven wrong .

- Hesitation before entry: You want reassurance before you act .

- About Trading : You really want to prove how great you are .

- Do not go if you should: You married your trade and just do not want to separate . Getting out would mean that you were wrong .

- Adding a losing trade : You're making a huge effort to prove that you originally were right .

- Grabbing a quick profit : You want confirmation that you did the right thing .

- Missing a chance because you can not pull the trigger on a trade : You 're still living with past mistakes .

In my 47 years of trading , I have seen many traders and investors come and go . Too many of them lost everything they had ever done . The big W. D. Gann died a pauper . The legendary Jess Livermore was broke when he committed suicide .

I have dozens of traders who lost money known for their egos got in the way .

I agree 100 % with the following statement by Marty Schwartz , the big S & P 500 daytrader .

"I've said it before and I'll say it again , because it can not be stressed enough - the main change in my trading career occurred when I learned MY EGO SEPARATION OF TRADING Trading is a psychological game . . most people think they are playing against the market , but the market does not care. you're really playing against yourself . you should stop trying things will happen to prove that you're right . just listen to what the market tells you now . Forget what you thought telling you five minutes ago . the sole purpose of trade is not to prove you 're right , but to hear the cash register ringing. "

To that I would add , "trade what you see , not what you think . " You can not afford to have your ego or your opinion shall be given . In your trading
Because both trading and investing businesses are uncertain of probabilities filled with uncertain outcomes , a huge ego or a fragile ego can easily destroyed . Defending your ego saps your energy , disrupts your perception , and will eventually destroy your business .

If your self-esteem is linked to your trading and investing choices , when it goes up and down with the results of your activities , you and your company in trouble . You must be strong self-image , not at the mercy of the outcome of your trade or investment choices .

To succeed in the market , you must have confidence in what you are doing and have confidence in yourself . But confidence should not be confused with self-image . Remember to make a market or fair to marry . If you see you are not good , be quick to get out . Run your trading or investing as a business. Practice self-discipline . You 'll be glad you did.

All the best in your trading ,

Joe Ross

Trading Educators Inc.

Joe Ross has been trading for over 47 years , and is a well known Master Trader . He has survived the ups and downs of the markets because of his adaptable trading style , low-risk approach that produces consistent profits .

Joe is the creator of the Ross hook , and has set new standards for low - risk. Trading set with his concept of "The Law of Charts " Joe was a private trader for most of his life in the middle of the . he shift his focus to 80 and decided to share his knowledge. After his recovery , he founded Trading Educators in 1988 to aspiring traders how to learn . profits using his trading approach

He has 12 major books on trading . All of them have become classics and have been translated into many different languages ​​.

Joe holds a Bachelor of Science degree in Business Administration from the University of California at Los Angeles . He did his Masters work in Computer Sciences at the George Washington University extension in Norfolk , VA .

Joe still tutors , teaches , writes , and trades regularly . Joe is still an active and integral part of Trading Educators .