The Journey Towards Trading Mastery

trading trading journey Oct 23, 2017

In our previous articles, we've recounted how success in trading must come from objectively understanding several market truths and being willing to face obstacles and failures head-on.  

One of the biggest takeaways is that becoming a successful trader isn’t a destination but rather a process. 

It’s a process of moving from unconscious incompetence to ultimately unconscious competence.

In your pursuit towards trading mastery let the following 9 steps guide your actions and intentions.  

These steps are adapted from the book - Handbook of Coaching - A Developmental Approach.

 

1. Know yourself.  

 

"It's not the mountain we conquer but ourselves."  - Sir Edmund Hillary

Leaders and thinkers through the ages have imparted this sound maxim that we must always start at home with self-knowledge before we seek to know and understand the external the world. 

"For most retail traders, trading is a solitary effort and...

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Why Failures Matter

trading stories Oct 15, 2017

 

As J.M. Barrie said, “We are all failures - at least the best of us are.” That should be a quote you have in mind when you are afraid to fail.

After all, I've seen over the years how much I could learn from failing in trading and/or in life. The lessons you get from a mistake are invaluable.

Throughout the interviews on the Desire To Trade Podcast, I spoke with traders who blew up as many as 9 accounts, made the same mistakes for years, and had no clue what they were doing at first.

Although these traders made the mistake of not looking back & evaluate their performance at the beginning, they still went on to become successful full-time traders.

Have you ever thought of failures as an aspect of moving forward?

What was a mistake you've done and what have you learned?

Let's start the discussion below!

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The Trading Journey

trading trading journey Oct 10, 2017
 

 

In this lesson, we’re going to be talking about the trading journey, the realities of the markets, and what realistic success milestones look like for most traders.

The following fundamental market realities and truths are ones that all traders need to accept so that they can appropriately set the proper expectations and goals.

If your goals don't match up to reality you are doomed to disappointment and failure.

  • You are competing against the best of the best from day 1
  • Trading is a skill and not learned via rote memorization
  • The market rewards randomness
  • Most of us are not wired to accept the realities of the market
  • For most traders, progress is an evolution, not a revolution
  • Trading is something you do, being a trader is someone you become.
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A Trader's Daily Routine and Checklist ✅

trading trading routines Sep 17, 2017

 

As we have explored throughout this month's articles on the theme of "Trading Routines", trading routines and rituals are constructs we can use to cue attention, mobilize motivation, increase confidence, improve focus and situational awareness, and prime performance.

Given how powerful routines can be let's take a second to consider how best to construct them.

Routines are essentially a set of habits. Whereas habits are a conditioned set of behaviors that have developed over the repeated reaction to a particular cue.

It's important to note that habits in themselves are neither inherently positive or negative.
For instance, it's just as easy to develop good habits as it is to develop bad habits.

So what's the key to developing good trading habits?

INTENTION

Excellence is an art won by training and habituation: we do not act rightly because we have virtue or excellence, but rather have these because we have acted rightly; these virtues are formed in man by doing his...

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Smells Like Routine Spirit ⏰

trading trading routines Sep 04, 2017

As we announced in last week's newsletter, this month's trading theme is "Trading Routines".

This week's lesson comes from our "in-house" risk expert - certified risk manager and frequent contributor, Michael Toma, who shares some perspectives on the power of routines and the benefits of triggers in cueing desired behaviours and actions.

 


The Power Of Routines?

Given all the things you can’t control when trading, I guess it’s only fitting to cram in all the things you can control - our actions, tools, strategies, and of course, our crazy routines.  

I’ve heard some wild ones throughout my career but in the end, it’s the trader themselves who is comfortable with their rituals supported by endless belief in its value.

Can these routines we praise actually trickle down to make us more successful?

When the topic is discussed at our upcoming meetup on September 19, I’m confident there will be at least one routine that each attendee follows...

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The 2-5-1 Trailing Stop Strategy 🛑

trading Aug 07, 2017

This month's theme is "Trading Setups", and one of the most important aspects of any trading setup is how one manages a trade once a position has been entered into.

We've all heard the old adage that we need to "cut our losers short, and let our winners run", and in a previous Weekly Perspectives, we've written about the importance of how this plays into risk management.

However just as challenging for some traders is what to do when faced with a winning trade. How does one balance the desire to keep hard earned profits versus taking the sure winner then sitting on the sideline and missing out on the big move?

Unfortunately, there is no right or wrong with regard to this aspect of trade management but simply tradeoffs.

There are many ways to construct profitable trading systems that can involve either taking quick profits or letting winners ride.

The emotional temptation, however, is to flutter back in forth between both approaches and in the end being consistently wrong with every...

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Weekly Perspectives: Multiple Timeframe Trading

Uncategorized Aug 07, 2017

While traders like to make the difference between intraday and swing trading and sticking to one, I have had a hard time picking the trading style that worked for me.  


In the end, I developed an interest in a method that falls in the middle of those two trading styles previously mentioned - multiple time-frame trading. It consists, in my case, of looking for trade locations on a bigger picture (higher timeframe) and entering the market on a lower timeframe based on a defined trade setup.


In comparison to intraday and swing, multi-timeframe trading usually produces trades with a higher reward. That is due to the fact that the take-profit can usually be placed according to price targets on the higher timeframe.


I, however, like to take partial profits on my multi-time frame trades. A first take-profit is placed at R = 1 and a second take-profit is placed according the a price target on the chart. That usually results in a higher win rate and keeps the reward fairly high.


The key...

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Weekly Perspectives: Adapting To Markets By Expanding Your Learning Strategies 💡

trading Jul 16, 2017

 

One of the most profound changes in the recent markets has been the acceleration in the rate of change. Trends and regime changes that used to play out in weeks or months are now occurring in days or hours.  

As a discretionary trader, one of the keys to being able to keep up and adapt to this ever changing and evolving environment is to have a solid understanding of how you best learn and a developed set of skill acquisition strategies.

I've written about and presented on this topic in the past about the importance of deliberate practice in trading as well as the necessity of developing a practice and skills based mindset and you can find a related webinar here -

Webcast: Why trying harder doesn't make you a better trader.

In this week's lesson, we discuss - 

  • The importance of learning as it applies to trading
  • What are the different learning modalities
  • Prioritizing the different learning modalities
  • Using mental rehearsal to prepare for your trading 
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Weekly Perspectives: Position Sizing For Success ⚖️

trading Jun 12, 2017

In last week’s lesson, we introduced 2 extremely important measures that all traders need to track and monitor.

Now that we've set that baseline, in this week’s lesson we will build upon the 2 measures we introduced last week and launch into the topic of position sizing.

As it pertains to this month's theme of risk management proper position sizing is key in the practice of risk and loss prevention.

Entire books are dedicated to the topic of position sizing so for the purposes of this lesson I will introduce a very common method for position sizing called Fixed Fractional position sizing.   

For those interested in other position sizing methods, here's a brief primer.

In this lesson, we'll discuss -

·       What the Reward for Risk ratio is

·       How to calculate Risk

·       How to calculate Reward

·      ...

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Weekly Perspectives: 2 Ratios All Traders Need To Track

trading Jun 05, 2017


This week’s lesson we will be brief however it will cover an essential risk management concept.

If you are new to risk management concepts then understanding this lesson will allow you to objectively understand the strengths of your trading system, how and where you can improve your results, and gain an appreciation for how much risk you should be taking on.

There are 2 measures which all traders need to be tracking regardless of your chosen method or timeframe.

Those 2 measures are:

  1. Win percentage (W)
  2. Gain vs loss ratio (R)


The win percentage (W) is the probability that a trade will have a positive return.

W is calculated by taking the total number of winning trades and dividing it by the total number of trades.
For instance, let's say you took 50 trades last year and 25 of those trades are winners, then your W would be 50% (25 / 50).

The win to loss ratio (R) is equal to your total trading profits divided by your total trading losses.
It is calculated by taking the total...

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