Weinstein Basic Rules for Trading Success

Mark Weinstein

7 Trading Basic Rules for Trading Success

  1. Work hard on the basics and know all the important details about the instrument you are trading.
  1. Most successful traders are humble not arrogant. If you are arrogant you are likely to lose because you will lack risk control because you feel you can beat the market.
  1. Understand your limitations as well as your advantages as a trader. Knowing your weaknesses, will allow you to trade in a fashion which to minimizes the impact of them and all traders have some weaknesses – even the best traders.
  1. Have a contrary mindset and don’t be frightened to trade against the trade against the herd. The vast majority of traders lose, so trading with a contrary mindset is an essential trait all winning traders have
  1. Be patient and wait for ideal conditions to present themselves before entering a trading signal. Understanding when to be out of the markets is as important, as knowing when to get in and when you consider most traders trade to much and lose, this is logical advice.
  1. Your trading strategy should be flexible and adaptable to the changes in the market. A dynamic trading strategy is needed to win because the market environment changes all the time, so your trading strategy must be flexible to keep up with it.
  1. Once a trade is profitable, do not become complacent or arrogant, one of the toughest parts of trading is keeping hold of your profits Most traders take their eye off the ball once they have profits profits but this can lead to the profit soon turning into a loss.

On patience and waiting for the right opportunity…

“I also don’t lose much on my trades, because I wait for the exact right moment. Most people will not wait for an environment to tip itself off. They will walk into the forest when it is still dark, while I wait until it gets light. Although the cheetah is the fastest animal in the world and can catch any animal on the plains, it will wait until it is absolutely sure it can catch its prey. It may hide in the bush for a week, waiting for just the right moment. It will wait for a baby antelope, and not just any baby antelope, preferably one that is sick or lame. Only then, when there is no chance it can lose it’s prey, does it attack. That, to me, is the epitome of professional trading”

On why he wins such a high percentage of trades…

“I have a real fear of the markets. I have found that the greatest traders are the ones who are most afraid of the markets. My fear of the markets has forced me to hone my timing with great precision. When I am trading properly, it is like a pool player running racks. If my gut feel of market conditions is not right, I don’t trade”

On luck in the markets…

“I don’t believe anyone ever gets wiped out in the market because of bad luck; there is always some other reason for it. Either you were off when you did the trade, or you didn’t have the experience. There is always a mistake involved.”

On the most important element for putting on a trade…

“ I am always looking for a market that is losing momentum, and then, go the other way”