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Trading to Win, Ari Kiev


The following quotes come from Ari Kiev's book Trading to Win

Ego and Psychology
Psychologically, the best traders all have much in common. They possess risk taking ability, flexibility, and a capacity for conviction. They are able to trade without letting their ego get in the way.

Vision and Focus
The most successful traders bring their vision to a focus with specific goals. You need to do the same, and to promise phenomenal result to yourself.

Losing and Winning
Losing is part of trading. The best traders don't get perturbed by losing trades, since over the long run they know they will be successful more often than not. When you are afraid of losing, you end up losing or missing opportunities because you are afraid to trade.
Intesting comment about losing. If you are a trader who has a low win ratio but your wins are big then it is possible that you lose more often than you win but you still come out ahead.

Then it is even tougher to mentally handle that because you know that for any trade that you place it has a better chance of being a loser than it has of being a winner.
This is very true and this is also why when you see adverts for trading systems the say things like Day Trading 90% Accurate. This usually means that 90% of the trades are winning trades. The psychology behind having 9 out of 10 trades being winners is absolutely fantastic. However, if that 1 loser is bigger that the 9 winners added together then you are trading a losing system.

I'm not saying that that is what is happening with the advertised systems that you see but it is something that you have to look at and take into account when accessing the potential risk of a system.
quote:
Originally posted by day trading

...bring their vision to a focus with specific goals. You need to do the same, and to promise phenomenal result to yourself.
What is an example of a specific goal that you should focus on?
Specific goals? Good question.

I have read and pondered about this many times...

Having a specific monetary or points or pips goal for the day, week, month etc. is a very difficult difficult thing to achieve with any consistency. If you have a solid trading strategy that produces an average of (say) 50 points a month then one month it might make 250 points and then next two months lose 50 points each month but the average is still 50 points per month. Bucketing those points into months, weeks or days does not benefit the trader.

A good goal may be oriented towards yourself as a trader rather than your actual performance figures from the end of the day. These should follow from becoming a good trader.

So a better goal would be something like "follow the system within 90% of the rules" and then measure yourself against each trade that you execute. Did you, for example, enter at the right time and put on the correct order? Did you immediately enter the stops and targets? Did you execute all the trades that the system picked today?

You can then try and aim for 100% personal trading performance each (say) week. If you achieve this then your actual trading statement should look exactly like your benchmark or back tested results for that week.
quote:
Originally posted by elite trader

quote:
Originally posted by day trading

...bring their vision to a focus with specific goals. You need to do the same, and to promise phenomenal result to yourself.
What is an example of a specific goal that you should focus on?

Philanthropy. Focus on the bigger picture. Remember that most men are reasonable which makes the markets predictable. If you are a rational and reasonable man (or woman) then it is easier to see inside the psychology of the markets because you can see inside of yourself.
So assuming that you consider yourself a rational person then you just need to say "what would I do in this situation?" That leads me to expand on this theme or perhaps turn it on its head. If you are a losing trading in the markets and you have been applying this theory - i.e. what would I do - then does that mean that you (the losing trader) is in fact not a rational person.

So what I'm trying to say is that you first of all need to establish if you yourself are like the average person in the street or the average trader. If you are not, then you should not be asking yourself "what would I do?" Instead you should be asking yourself "what would Mr X. do?" and then try and mimic what he would do.

This then leads on to the concept of NLP. i.e. here were are trying to model a super-trader and mimic what a super-trader does. Through Neuro Linguistic Programming we can create a clone of what is successful and follow that.
quote:
Originally posted by day trading

...if that 1 loser is bigger that the 9 winners added together then you are trading a losing system.

Is there somebody that checks the advertised systems to make sure that they do not do that?
quote:
Originally posted by super trader

Is there somebody that checks the advertised systems to make sure that they do not do that?

No, there is very little regulation in advertised systems. It is up to you to verify the results and make sure that you are happy that they accurately represent what is being stated.

The CFTC does provide some protection against claimed results if the vendor states that they are trading real money and in fact they are not.

A good place to question any system is here on the Trading Advisory Services. Give us the details of the service and its claims and we'll look into it in as much detail as possible and give you an objective opinion and other steps you should take to verify the system before you subscribe to it or buy it.
The futures and options market on the exchanges is regulated by the CFTC but one of the most unregulated markets is the forex market. That is why you see so many more systems pushed onto this market.
Hello group... I am new but have talked with daytrader.
In regard to settings sustainable goals, one idea is to use a benchmark against yourself as you would the Sp-500 against all other stocks.
Employee work output is a good one. In my 45 years of business exposure I can tell you the average person earns us 4 to 6 hours of income per 8 hours paid to them on a yearly basis. That is 5 out of 8 hours. I have to lose 3 to make 5. Yet I still make a good living.
Convert this to trades.
Hello George..
In regard to the benchmark I stated. here is the next part to compare.
At what level of supervision or controls am I working under to produce 5 average hrs of profit?
Example: 5hrs production with: A.100% supervision
B.50%
C.10%
Each level of percent can be said to be a form of restraint which shows your contribution to self imposed discpline and the will to succeed.

To move up from one level to the next you must obtain a higher average at your present percent level which thru sheer force spills over and breaks thru to the next level.

Each level requires an adjustment and a fitting in period.
In trading we move up to a new level in the amount of contracts we can handle. What number is a barrier is only known under real fire, Paper targets do not shoot back.