You've Got A Great Trading System. So Why Are You Losing?Mental Fitness for Option Traders |
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Are YOU an Options Premium Collector, a Conservative Trader,
a Directional Trader |
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You've done your homework. Countless hours of seeking out the right guru (or piecing together your own system). Weeks of monitoring your guru's daily trade picks (or paper-trading and back-testing your homemade system). You've done it by the book. No seat of the pants trading for you! OK, now you're confident. It's time to put your money where your homework is. You've had your coffee and your first trade signal is before you. Confidence high. Trade made. First loss. Not a problem. You understood before you started that successful traders both win and lose and “losing is part of the overall winning”. You've also heard more then once that “successful traders don't win on every trade.” Moving on, still confident. Next trade made. Another loss, but this one hurt your pride a little because you got stopped out early in the trade, and then the market rebounded and would have hit your profit target if you weren't topped out. You double check. Yep, you placed the stop where your trading system told you to place it. You kind of had a feeling that the early weakness in the market was just profit-taking from the previous day's trading, but you're trading a system and you must stick to it. Wounded, but resilient. After a good night's sleep and a few mouse clicks, your
new daily trades are in front of you. Hey, this one looks good! It's a
little bit more risk than yesterday's trades had, but look at that profit
potential! With a smiling face, the trade is executed. You decide to “watch” the next trade… I mean, isn't it wise to make sure the system gets back on track before you “throw good money after bad?” Isn't that what a conservative trader does? Trade watched. It wins! In your head, you beat yourself up a little because you know that when you started your “live” trading, you made an agreement with yourself to take the first 10 trades “no matter what”… and here you wimped-out and missed a big winner that would have gotten you even. What's happening?!
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What's happening is that you are out of control. Your
emotions are ruling your trading. The above scenario plays out in every
trader from time to time.. newbee and veteran alike.
The winning trader senses what is happening and nips it in the bud. The winning trader spend time EVERY DAY, working on “the discipline of trading”. Reads a chapter in his/her favorite psychological trading book, scans the “ten commandments of trading” that hangs on the wall over his/her desk, understand the in & out of the stocks he/she would be trading, listens to his/her mental training software for futures trader… Something… Every Day… before trading begins. There are many more losing traders than winning traders… and it's seldom about the trading system. In my career, I've come across at least 50 systems that I consider A+, yet I know for a fact that MOST traders that have traded on these systems have lost. Why? They were not in control of their emotions. Are You?? |
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Article Source : Trade Juice
/ Mental Training for Traders
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Articles On - Options Trading Psychology
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