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Psychology of going from Sim to Real money
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Psychology of going from Sim to Real money

  #21 (permalink)
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Luckily, my IQ compensates.

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  #22 (permalink)
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Every subject has a theoretical side to it and it's always more fascinating. This is where you convince yourself that you have a direction and all the research you are doing will leads somewhere. But, some people love the research side more than the actual side and staying there is comforting to them. Further, the research phase continues forever while he/she convinces themselves that further research is required before the real hands on is applied.
The perfect moment never comes as there is always another variable that could be added.

In my opinion the theoretical researcher could gain as much knowledge as the person who practices it given enough time is spent on the subject, enough reading is done and talking to people who do practice the subject for real. But, there is a major difference between the two:
The person who has moved on beyond the theoretical could find more practical and pragmatical solutions to a problem that a theoretical researcher only understands...well, theoretically.

As it pertains to trading: What problem are you solving when you paper trade? Entries and exits, but when you trade real money you deal with entry,exit, risk,psychology,distractions, frustrations, speed, stability, prioritizing, implementation, and time. I am sure those who trade for real could name more.

PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
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  #23 (permalink)
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I am solving the problem of keeping cool.

I also feel that the more experience I have with real money, even if just once a week, the easier it will be in the future to trade.

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  #24 (permalink)
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I suggest you consider doing a critical analysis of your trading performance. Gather the last month or two of trading performance metrics for your sim trading and for the recent live trades you have. Then identify the 2 or 3 metrics that stand out as being distinctly different. (I mentioned the two most likely metrics in my previous posting). Once you have those then you at least have some idea what the actual problem area is.

Most traders do one or two things differently in live trades .vs. sim when they first attempt to make the transition. So the performance deviation is a result of this change of behavior. The most likely behavior changes (due to stress) are: hesitation, taking profits too quickly, and improper risk control. The underlying causes of these behaviors are well known. The more accurately you can identify the specific problem you are having, the quicker and more directly you can address it.

Be Patient and Trade Smart
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  #25 (permalink)
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The process

You have to focus on the process of trading well... Of trading correctly. Go back and review all your live trades, and ask yourself if each trade fit with your system and was adjusted accordingly. It is irrelevant if they are winning or losing trades... The key is, did you trade the process correctly?

Now I am making some assumptions here, and that is:
- you journal every trade and adjustments with screen shots and detailed notes why
- you have some type of checklist in place to grade yourself on how well you performed that day
- prior to trading you have some criteria that must be met before trading that day (one of mine is at least 7.5 hrs of sleep the night before)
- you have a plan in place to recharge your psychological capital and you know the signs that show you are depleting

Every moment of trading real $$ you have to be in peak performance! So when you start out with real $$, you have to take your time, and trade for shorter periods of time. Getting breaks. Letting yourself recharge. THEN remind yourself that you are on the side of probabilities, and your winners will be larger than your losers IF you can stay in the trading market for a long enough period of time. This is why you trade the process.

Good trades,
Yukoner

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  #26 (permalink)
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In trading you need to be calm, cool, and collected. Think Iceman from Top Gun, not Maverick.

I just made the transition live last week so I understand your feelings. I did really good reading the charts and picking my trades in SIM, but now I am live I have found it harder to actually execute the trades that I was seeing before.

For me this isn't such a problem as I am confident that I can read the chart and understand what will possibly happen next. Also in my strategy/trading plan I have a plan to lose. I have limits and work to keep them. This helps save my money and mind from myself. A trader is like a boxer. Boxers are not afraid of being hit, they actually train to survive the hits and be able to land theirs when it is time.

I wouldn't SIM trade for anything longer then 8 weeks. Go M6E/M6A mico currs so you can trade as small as possible when you first go live.

**Focus on the skill of trading and the money will follow.

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  #27 (permalink)
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tturner86 View Post
For me this isn't such a problem as I am confident that I can read the chart and understand what will possibly happen next.

Well to be fair we will never know for sure what will happen next. We can merely create a trade management plan to take advantage of it "IF" it does.

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  #28 (permalink)
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Rock Sexton View Post
Well to be fair we will never know for sure what will happen next. We can merely create a trade management plan to take advantage of it "IF" it does.

Hints the word Possibly. Each setup has different probabilities as to what will happen. If you have a well laid out trade plan then it addresses the possibilities and probabilities. When I place a trade there are two outcomes (three if I get in the way and jack it up). One it hits my target or two it doesn't and hits my stop. The third is if I get in the middle of the trade and end it with a smaller profit or smaller loss. Typically I am trying to not do that, I set my stop at a price action level where if it is hit then the trade is no longer valid. So if I am stopped out, my initial convictions for the trade are gone, Same for my profit taking limit. I aim for an area where if it is hit then my convictions for the trade are gone or changed. So it becomes binary. Trade on, trade off.

If you can do this then you look for the best and highest probability trades of the day, and not trade anything else. (Easier said then done I have found going live.)

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  #29 (permalink)
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Rock Sexton View Post
Well to be fair we will never know for sure what will happen next. We can merely create a trade management plan to take advantage of it "IF" it does.


tturner86 View Post
Hints the word Possibly. Each setup has different probabilities as to what will happen. If you have a well laid out trade plan then it addresses the possibilities and probabilities.

I am not sure any of us ever get's completely beyond being nervous or feeling some level of stress when putting on a new trade. I think a trader will have to be able to stay focused and clear minded while experiencing some stress. To expect otherwise is not realistic. This is the dividing line between SIM trading and Live trading. SIM traders don't experience that stress factor at the moment of putting on the live trade or waiting for the live trade to find it's natural point of completion (at the profit target or a stop).

The stress comes from the uncertainty of the trade outcome, which in my mind is always 50/50. Any individual trade attempt is going to have a random and unpredictable outcome. This is the inherent uncertainty of trading.

One problem I had to work through in my trading, a personal hurdle for me, was the 're-analysis' of the trade/setup within the first 2 minutes after the live trade executed. So I found myself in the trade, no problem entering the trade (ie. no hesitation), but once in the trade I immediately started second guessing the trade setup and more often than not talked myself back out of the trade and exited the position before the market had the time it needed to take the trade to it's target. This was my way of reacting to and relieving the initial surge of stress I felt in live trades. What I found was that entire process would dissipate when I was able to stay in the trade more than the first 2 minutes, after that initial 'panic' had passed my stress reaction subsided and I was fine. I still feel the initial stress reaction, to a lesser degree, but I am now able to recognize it for what it is and hang in there with the open position until I have time to calm back down.

I had to recognize and accept the market needs time to work it out. As long as the trade setup remains valid I have to stay out of the way and let the market find it's path in it's time. Often the market won't take the exact path I expected, but it still finds a way to get there.

Be Patient and Trade Smart
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  #30 (permalink)
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I completely agree, as I just went live again I was hit with those feelings. And I have had the same issue, fire off a trade and then look at the chart goin what in the hell did I just do. You expect a certain movement from your setups, but it rarely does what you are expecting. Most of the time if your initial read is correct it will be successful. The problems I have had is where I second guess my initial read before a trade and then enter differently, only to lead to a stop out. Most of the time if I would have listen to my initial read I would have been profitable. I am really having issues with this in ranges, I will think it is a range from the beginning, but get sucked into a move thinking it will breakout, only for it to reverse on me.


trendwaves View Post
I am not sure any of us ever get's completely beyond being nervous or feeling some level of stress when putting on a new trade. I think a trader will have to be able to stay focused and clear minded while experiencing some stress. To expect otherwise is not realistic. This is the dividing line between SIM trading and Live trading. SIM traders don't experience that stress factor at the moment of putting on the live trade or waiting for the live trade to find it's natural point of completion (at the profit target or a stop).

The stress comes from the uncertainty of the trade outcome, which in my mind is always 50/50. Any individual trade attempt is going to have a random and unpredictable outcome. This is the inherent uncertainty of trading.

One problem I had to work through in my trading, a personal hurdle for me, was the 're-analysis' of the trade/setup within the first 2 minutes after the live trade executed. So I found myself in the trade, no problem entering the trade (ie. no hesitation), but once in the trade I immediately started second guessing the trade setup and more often than not talked myself back out of the trade and exited the position before the market had the time it needed to take the trade to it's target. This was my way of reacting to and relieving the initial surge of stress I felt in live trades. What I found was that entire process would dissipate when I was able to stay in the trade more than the first 2 minutes, after that initial 'panic' had passed my stress reaction subsided and I was fine. I still feel the initial stress reaction, to a lesser degree, but I am now able to recognize it for what it is and hang in there with the open position until I have time to calm back down.

I had to recognize and accept the market needs time to work it out. As long as the trade setup remains valid I have to stay out of the way and let the market find it's path in it's time. Often the market won't take the exact path I expected, but it still finds a way to get there.


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