Rande Howell's Material Psychology (www.tradersstateofmind.com) | Trading Reviews and Vendors


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Rande Howell's Material Psychology (www.tradersstateofmind.com)

  #20 (permalink)

Trading Apprentice
Chihuahua, Mexico
 
Futures Experience: Advanced
Platform: Ninja Trader and Sierra Chart
Favorite Futures: TF
 
Posts: 32 since Dec 2011
Thanks: 25 given, 25 received


rahulgopi View Post
Merry Christmas and Happy New Year Jorge,
I guess most traders go thru this cycle of frustration and learning. ZEN is a lifestyle and life long journey for Tibetan monks. If we expect to master emotions over a weekend course, it will result in disappointment and frustration. I think at some point we will have the wisdom to be patient and keep working at it .

Jorge, in my personal experience SIM trading only does few things, master your platform and methodology and provide statistics for the system. During the SIM period, I tracked all my trades, including the ones that I take and did not take as per the strategy on an excel sheet and came up with the statistics over a 3 month period of time. Eventually when I plotted this, I got a clear view on the statistics of my system. Please note, if you tweak the system in any way, you will skew the numbers and may not be accurate. Statistics will help you with developing trust in your system.

Bottom-line is SIM trading tells me the statistics for my system if it is executed as per the plan. I am able to execute SIM trading as per plan since emotions are not as high as in live trading. If you exhibit impulsive behavior in SIM trading or are unable to follow the plan, then this has to be addressed during SIM trading.

I never went back to SIM trading after this initial period. Instead, I traded very few contracts and worked on my emotions. If you dont have trust in your system backed by statistics, you will be tempted to tweak the system with few trades that result in a loss.

Working with beliefs will take time. It is a process where you start observing your thoughts and eventually tying it to an underlying belief. Rande ties the thoughts to Archetypes from Jungs method, which is pretty powerful in labeling and understanding the thoughts. I was amazed at the amount of negative thoughts I had and how I was fused with it, taking me for a ride. I am still working on this aspect, will provide an update in few months time.

Now my struggle is with myself . The reality is, trading gave me the opportunity to look at myself in a more meaningful way. I intent to continue and explore further in this path.

Merry Christmas and Wishing you a fantastic year ahead !!


Hello Rahul

Hoping you are enjoying a very happy Christmas and holidays along with your family.

Talking about my system, I have a lot of confidence on it. I also keep an excel spreadsheet with statistics of almost two years on how the markets move and the probabilities for these moves according to my strategies and setups. In fact, I keep writing the statistics day after day as part of my daily activities of the analysis I perform after trading hours.

All this has allowed me to master my trading skills while trading on SIM.

What I think is that I still do not trust or I still do not have enough confidence of my execution of the system while trading live, because of emotional arousal that turn out into physical sensations like sudden increase in the heart beat rate, sensations on my throat, stomach, chest and even headaches sometimes when my trade is taking too long.

As Mark Douglas classifies the trading styles in mechanic, discretionary and intutive, I will say that my system is a discretionary one. So, in the system we analyze how the market is moving and how we think it will move next in order to enter the trades, more than entering a trade because of a mechanical setup.

When I am trading on SIM, I even take higher risks setting a larger stop loss and letting the maret makes their moves before going to my target and most of the times they work out. Whereas, when I am trading live, I trade more not to lose than to win, since I also try to diminsh the risks as much as possible and many times not allowing the market to complete their moves before taking off into the direction of the trade I entered.

Although I also have to admit, that even trading on SIM, my ego sometimes enters into scene and I sometimes get frustrated when things do not work out right away the way I planned.

I know that Rande ties the thoughts to archetypes and in that way he classifies the core beliefs we have and that the essential part is to strengthen the Warrior, the Sage, the Ruler, the Magician and to convert the immature Orpahn into a mature one.

The thing that I still do not know is which would be the best way exactly on how to strengthen those needed archetypes in order to form the proper trading committee, so that the inner critic and the adapted voice do not take the main seats on the trading committee?

Jorge

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