I started trading with the attitude as most new traders. I thought I could double my money in no time and gain financial freedom that we all seek, after all it’s easy right buy low sell high ‘wrong’. As I was dreaming about my financial freedom my account was dwindling before I knew It I was down 25%.
Now looking back on these short few months, I ask where did I go wrong? Because I’ve studied the market, different strategies, the greeks, when to entry/exit, trading psychology, the importance of a plan , and read a lot horror stories about people blowing out their account.
I’ve learned a lot about trading over the last few months but I think I’ve learned more about myself.
It’s not how much we know that makes us successful, it’s how we apply the knowledge we have that makes us successful.
So what will it take for me to be successful? Well, after reviewing all my trades my thought process over the last few months and identifying critical mistakes. My plan to turn this business around is simple but one of the hardest to follow. For me it’s just following my plan. For whatever reason I haven’t and now I’m down 25%. (Not saying it would have been different). Why haven’t I followed my plan the procedures I’ve laid out to give my business the best possibility of success? Well, maybe it’s a lack of confidence, inexperience, fear of losing, maybe somewhere deep down inside there’s a fear of being successful (now that’s deep) but who knows.
I closed out all trades I’m taking time off to review my goals, plans, myself, build some confidence and come back with a new attitude, more control over my emotions, more focussed.
My advice to myself and others new to trading.
-Realize this is a business.
-Choose and instrument to trade
-Choose a strategy
-Create a plan and follow it.
-Paper trade until you have confidence in your strategy and trading plan
-Keep a trading log
-Start a journal
I’m sure more could be added to the list.
Instead of being all over the place like I’ve been and loosing 25% of your account. Take your time paper trade for a while the market isn’t going anywhere and when you’re ready, when you’ve proven to yourself that you can be successful in a paper trading account then go live with it. One last thing treat your paper trading account as if it’s real it’ll mean more to you.