powerful observation ... i have been thinking thru this lately.
the tagline for this forum is:
but ... just wondering ... would having your own method (and not a bunch of scraps of OPM duct-taped together -- where OPM = Other People's Methods) trump psychology in the long-run?
true, beginners may do well to study someone else's method and get a grasp of the *mechanics* of this business. trading that other method first on sim and then live/cash will really expose deficiencies in psychology / money-mgt.
and how many of us have been down that road already? i know i have.
but assuming that one can master another's method, the question becomes: is it mostly psychology that separates the guru from the student? market experience would be irrelevant if the guru truly trades the system the way it is taught to the student. a signal is a signal is a signal, right?
or is that burning thought in the back of the student's mind that says "if only i changed X or Y or Z..." which is the real reason why the guru consistently makes money and the student gets frustrated and goes in search of a new guru?
i wasn't sure where to post this, so mods please feel free to relocate.
I feel that your method should include psychology, otherwise it's an incomplete method. The method you create from copying someone else, or completely on your own, should factor in the way you think and feel.
The following user says Thank You to Trankuility for this post:
Yes , your psyche determines if you succeed or not because it causes you to keep what you earn and build your account . It seperates the long term winners from the washouts . Seperating gurus from students ? I dunno . The 2nd question is a good one and thought provoking . Market experience would be irrelevent if a guru doesnt trade the system (or methodology) they teach . The problem with the last part is that "a signal is a signal" isnt 100% accurate in my experience . The variables you insist upon that constitute an entry and an exit have to be defined , in advance , but the market has a way of confounding us right at the moment our variables appear . Perfect signals are rare and dont work any better than not so perfect signals so its then that 1000s of hours of experience will help you .
The following user says Thank You to Eric j for this post:
I think overwhelming majority focus on methodology. And I believe Sam Sieden was speaking to this with regards to "copy-paste". This is why I've also said that you can't just copy someone elses method, even if they are profitable, and expect you too will be profitable. All the same story more or less.
The focus should really be on money and risk management, risk of ruin, expectancy, and of course the huge one is psychology. The best management and methodology is still worthless with erratic execution.
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The following user says Thank You to Big Mike for this post:
If you were the world's most successful trader and an excellent teacher ... and you taught a training course on your methodology complete with interactive DVD's, one on one mentoring and Hours of video of your actual trading calling out and explaining trades as you took them .... many of your students would still fail to make money .... and would leave your trading course to enroll in another course from someone else or start threads on futures.io (formerly BMT) with titles like:
Are there any trading systems that actually work?
XYZ trader is a fraud!
I spent $1 Billion on training and I still can't find a good trainer!
If you simply posted it in a futures.io (formerly BMT) thread and posted trades and your methodology, someone would invariably post;
I back tested it, your system doesn't make money!
I don't believe you unless you post your entire tax return with all the supporting documents and copies of all your bank statements and brokerage statements.
B-B-B-But you didn't take every single trade on every single day ...
Could you be more specific about what actually constitutes a moving average cross over...I read all your material and I am still confused about how that actually works...
ay, there is the rub.... Hamlet Act 3 Scene 1
I'm just a simple man trading a simple plan.
My daddy always said, "Every day above ground is a good day!"
The following 6 users say Thank You to ThatManFromTexas for this post:
I've been thinking about the market as a lead and follow situation where there are a few people who trade one way and then have masses of people follow them thus maximizing their trade profits. Those at the tail end of the queue are the losers. Of course things are much more complicated than this but I like to think of it this way.
I agree with Mike I read this article as well. I believe sam was speaking of copying and paste another faulty system where it may work at times but in the long run it's faulty. As a matter of fact Sam was my teacher at OTA three yaers ago and he teaches supply and demand to the core. As for emotions and psycology I learned to seperate myself from the trade I just put in my orders in and walk away. Full bracket order limit to buy/sell, stop loss and limit for my profits.
Trading is an art. Not everyone can be the artist.
Forget the robots and firms paying guys much smarter than me to program.
I'm not one of them. I'm a salmon in a sea of sharks.
IMO, skilled discretionary trading is what it boils down to for the retail trader
that wants to be successful.
Professional money is always one step ahead and most retailers are too late to the party.
I've been late myself too many times to count. Maybe I was on time but I wasn't sure if
it was okay for me to come in.
I don't like copy and paste methods. You have to think for yourself.
The mind of the retailer -
I don't want to lose my money
I don't want to miss the big move
If you think for yourself, you understand why you're invited to the party and that
it is most definitely okay to come in. You're never late even though sometimes
you may say the wrong thing and get kicked out early. You leave promptly
and come back when you the next invitation arrives. Don't stick around, begging to
be let in. You look desperate.
The following 2 users say Thank You to Massive l for this post: