By Sherrie Nish
Your business and life plan should be like a resource book that you can consult to find the important information you need. Because everyone is different, each book will be unique, but will be an implement to help you stay focused and on the right path.
It is “Mission Impossible” to believe that you will ever learn everything there is to know about trading. Professional traders will laugh and tell you that you’ll never learn all of it. There’s too much and it constantly changes. However, having a personal resource book, your business and life plan can be another thing to help you turn your trading into a profitable business.
In trading, the first thing needed is to have a strategy. Apex Investing excels at providing a strategy along with the rules for you to learn and follow. Perhaps it takes longer than expected, but follow Marion’s advice and focus on one thing. Let all the other things go by until you know that one thing upside-down, backwards and forwards. Then you can build on it; adding one more thing and another and then, go from there. If you don’t, learning to trade becomes an exercise in frustration. Make this your first lesson.
Since last week, have you pondered on the following questions? What is your job? And what is your job description as a professional trader? Hint: It isn’t trading! Many get into trouble when they assume that if they are going to be a trader, their job is to trade. That is about the last thing that would appear in the job description. If you have the job description and you know what your job is, how do you know when you are doing your job?
What is the difference between an amateur and a professional trader? It has nothing to do with how profitable you are! With a professional trader, you will never know what kind of day they have had. With an amateur trader, everyone knows what kind of day they’ve had! A professional has their emotions totally under control. Once you’ve learned your system/strategy, the emotional part of trading is the biggest difference between success and failure.
So how do you move from beginner to professional level? When asked, professionals all admit to learning a lot over the years, MOSTLY ABOUT THEMSELVES. To the beginner, that may sound crazy, since there is so much to learn. The problem comes when people throw their hands in the air and quit, realizing the actual problem lies between their ears. They don’t want to do the hard work, which is to find the problem and work through it. You have to admit you are the problem. You have to develop strategies to change, not a lot, just change the little things. If you don’t change the little things, they will add up and start to build into big things.
Using the Psychology Section of your business and life planning binder, have a different page for different things. Label one page “Darrell”, and jot down the little Darrellisms that can help you in your trading. For example, “Trade to trade well. The money will follow.” Trading well is quite a profound statement, even if it sounds simple-minded. Get the focus off making money. When you trade well, everything else starts to fall into place.
Another thing you could put on your “Darrell” page would be information about his five percent plan. Use five percent of your capital; not what’s in your account, what’s in your available trading capital. In Ft. Worth, Darrell said, “I don’t trade to build my trading account. I trade to build my bank account.” Many think it is necessary to have a trading account of a bazillion dollars in order to make a good income. You only need enough in your trading account to trade with. It’s two different accounts. Of your trading capital, sit down and figure out the five percent divided by six plan. How much do you want to leave in your trading account? How much are you transferring into your bank account?
Have another page labeled “Mark Douglas” and add the little gems from his books. They can be mental triggers to remind you of important trading tips. According to Darrell, Douglas’ book, Trading in the Zone is mandatory reading and reference material for your personal library. Douglas also wrote The Disciplined Trader, as well as other books. They are worth the investment and will help you immeasurably.
Because you cannot remember everything and keep it all in your head, have a place in your binder to keep these little gems that you gather from your reading and study.
Since trading is so heavily vested in emotion and psychology, you need to focus more of your reading time and resources on the things that will help you in those areas. Use another page to make a list of books. Have it contain books you have read that have helped you as well as those you want to read. Some may not be “trading” books, but the ideas can help as you trade. As you make your list, take time to share it in the forum. Here is the LINK for the list Marilyn started during her show.
One last aspect to consider is trading psychologists. They may be too expensive for some, but you can read their articles or watch their YouTube videos. Look for Randy Howell.
Many of the big traders take the summer off causing the volume to go down and trading to become slower. This makes summer a perfect time to pull out a book and read a couple of pages or make a list of Darrellisms, while you allow the NinjaTrader alarm system to do what it was designed to do.