Funny, but after trading for more than 15 years, I still am capable of forgetting a cardinal rule: The paper you own, in the end, will be intertwined with the fate of the 30 year bond.
finance funny fate end forgetting paper rule bond capital-markets
The Fed is trying to counteract a number of very poor policies coming from the executive and legislative branches,.. It's damn near impossible to overcome [those] headwinds.
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Capital markets reward you for what you learn that other people have yet to ascertain.
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In the short-term the stock market is a voting machine; in the long-run it acts as a weighing machine.
If I am bullish, I neither buy on a reaction, nor wait for strength; I am already in. I turn bullish at the instant my buy stop is hit, and stay bullish until my sell stop is hit. Being bullish and not being long is illogical.
Fundamentalists figure things out and anticipate change. Trend followers join the trend of the moment. Fundamentalists try to solve their feelings. Trend followers join their feelings and observe them evolve and dis-solve.
The feelings we accept and enjoy rarely interfere with trading.
There are old traders and there are bold traders, but there are very few old, bold traders.
I would add that I consider myself and how I do things as a kind of system which, by definition, I always follow.
Systems trading is ultimately discretionary. The manager still has to decide how much risk to accept, which markets to play, and how aggressively to increase and decrease the trading base as a function of equity change.
Trying to trade during a losing streak is emotionally devastating. Trying to play "catch up" is lethal.
The elements of good trading are: 1, cutting losses. 2, cutting losses. And 3, cutting losses. If you can follow these three rules, you may have a chance.
Losing a position is aggravating, whereas losing your nerve is devastating.
The markets are the same now as they were five to ten years ago because they keep changing - just like they did then.
Luck plays an enormous role in trading success. Some people were lucky enough to be born smart, while others were even smarter and got born lucky.
Having a quote machine is like having a slot machine at your desk - you end up feeding it all day long. I get my price data after the close each day.
A losing trader can do little to transform himself into a winning trader. A losing trader is not going to want to transform himself. That's the kind of thing winning traders do.
If you can't take a small loss, sooner or later you will take the mother of all losses.
It is a happy circumstance that when nature gives us true burning desires, she also gives us the means to satisfy them. Those who want to win and lack skill can get someone with skill to help them.
Risk no more that you can afford to lose, and also risk enough so that a win is meaningful.
Dramatic and emotional trading experiences tend to be negative. Pride is a great banana peel, as are hope, fear, and greed. My biggest slip-ups occurred shortly after I got emotionally involved with positions.
Be sensitive to subtle differences between 'intuition' and 'into wishing'.
The trading rules I live by are: 1. Cut losses. 2. Ride winners. 3. Keep bets small. 4. Follow the rules without question. 5. Know when to break the rules.
I usually ignore advice from other traders, especially the ones who believe they are on to a "sure thing". The old timers, who talk about "maybe there is a chance of so and so," are often right and early.
I set protective stops at the same time I enter a trade. I normally move these stops in to lock in a profit as the trend continues. Sometimes, I take profits when a market gets wild. This usually doesn't get me out any better than waiting for my stops to close in, but it does cut down on the volatility of the portfolio, which helps calm my nerves. Losing a position is aggravating, whereas losing your nerve is devastating.
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