Absolutely true. And I agree that a good mentor is invaluable. It's hard to work smart when you don't have examples of what smart is!

Phantomtrader may have just delivered on the money spent. Even if the education you pay for is the best money could buy, and came with years of historical proof of success, all educations lack one important factor; you must find your own way.

The root cause of traders failing is an inadequate amount of capital to suit their purpose/strategy and the inability to properly allocate their exposure. Something "educators" would never discuss.

Most consistently profitable traders will use the minimum exposure to establish their goal and be satisfied.

I do not believe any consistently successful traders seek to be "rich";just successful.

Trader

I'm a bit of a contrarian when it comes to funding an account for new traders. Although in the long run proper capital is important, for a new trader perhaps it's better that he/she start with a small account. Working with a small account can teach a trader how to protect his/her capital with smart stops and efficient setups for trades. Working with a large account from the git-go may just encourage a new trader to say "Tomorrow is another day" and continue to bleed the account with crazy trading until he/she blows it. I recognize that an account can be refunded, but the idea here is to learn the discipline of managing your money. If you can do it with a small account, you certainly will be able to do it with a well-funded, fully capitalized account.

We may agree to disagree a little on this subject.; although I understand your points.

I take the view that the new trader has ample opportunity to hone their skills on paper or sim. Treat the strategy as real , using their desired sim fund allocation as if it were real money (what they intend to invest),and be absolutely sure they are comfortable with the strategy,including trade management.If the new trader cannot apply the necessary discipline in the 'testing' phase they have no business trading .

The new trader can start small,say 25% of their available funds, blow it: and think "well there is tomorrow and I have 75% left". Their leverage is bumped up and I'll bet you they try to "catch up". Fodder.

Personally, I believe the trader has a reasonably good chance to succeed if their set up is sound and are prepared to plod along with 1-2 contracts,regardless of type, for every 10000.If successful, 2-3 when they hit 25-30000.Will take time, but no business became a Fortune 500 company in a year.

Starting with much less must cause some unnecessary stresses on the trader and will likely become 'fodder' in time.

Having a mentor/advisor to map out the potential pitfalls of poor money management and risk: reward relationships would be extremely useful to a new trader ,even a "surviving" trader for that matter. Unfortunately, most new traders seem to think they have the answers.

Just thinking aloud, it may be some thing like a "thread" that could be set up where new traders could seek advice from others related to trade management etc. I certainly don't have all the answers,don't have much patience for dogmatism, but would be willing to help.

I could be way off base here,too

The root cause of traders failing is an inadequate amount of capital to suit their purpose/strategy and the inability to properly allocate their exposure. Something "educators" would never discuss.

Most consistently profitable traders will use the minimum exposure to establish their goal and be satisfied.

I do not believe any consistently successful traders seek to be "rich";just successful.

Trader

Whether or not inadequate capital is the 'root' cause or not, would make for a long and probably pointless discussion. It is absolutely one of the main ones.

However, an account of any size does a trader no good if they don't learn to win more than they lose. Any trader can lose a significant part of their account, even with good money management, through a death of a thousand cuts. Sure, a 'large' account might reduce stress and fear of getting wiped out really quickly and will allow time for more learning (e.g. losses) but at the end of the day you have to know that you've got to learn, acknowledge when you aren't learning and then modify your approach.

Money management and capital pose an interesting problem. For argument's sake let's say you have determined that $25,000 is 'adequate' capital and that with money management you never lose more than 1% of your capital in one trade or even in one day. However, after 6 months you find that you have lost $5,000 and now have only $20,000 in capital. Does this mean you can no longer trade because you 'need' $25k to have adequate capital? If the answer is that you can trade with $20k but you need to change your money management strategy then you would have to ask yourself why you didn't do that in the first place. This scenario of course then continues ad nausea when your $20k shrinks to $15k and so on.

PS - Here's an 'amusing' anecdote. I was looking at moving to another broker working with an algo system. He said that all I really needed to fund the account was $15k but recommended $25k. His reasoning was partly to weather any drawdowns but his 'key' argument was that if I lost $5k of $25k I wouldn't feel so bad because I had only lost 20% of my capital instead of 33% if I invested only $15k. Perception and perspective are really interesting things.

Well a couple of thoughts here. You mentioned stress - traders have to get used to stress - it's part of the business. What you have to learn is how to control your stress while acknowledging that it's always there. My level of stress goes up as soon as I pull the trigger. All the possibilities of a trade outcome are running through my head. Everyone wants to be right, but acknowledging that you can be wrong is stressful, but very necessary.

About sim, I think it's great to get used to the markets and test strategies. But psychologically, a trader must get used to the real thing, stress and all. I've had a few people who I've helped along the way who have said "I can do it in sim, but I always pick the wrong trade when live". Well, if that's the case, then dump the sim and get on with real life and learn how to manage the real world of trading.

What I've done with a few people is tell them to open an account for $2,500. I give them a simple setup, a few rules to follow and trade 1 contract for 1 point, one trade a day max, 1 point stop, every day picking out the best opportunity to execute that setup. That's it. No scaling, no rocket science. After a few weeks or a month, run your statistics and see how you did. Did you follow the rules? Did you pick a good execution point? What could you have done better? Not a lot of risk here. Just a real time learning experience. If someone blows their account after a few months doing this and can't follow the rules of a simple setup, then they should probably look for another career. Depending on market conditions, they may make a few bucks or they might come out slightly negative - but that's okay, as long as they followed the rules.

You have a good idea about a mentor's thread - accumulate some helpful stuff for traders, new and old, because it will benefit everyone, myself included.

This is a tough business. Get over it. Everybody has spent money on software, systems, mentors, teachers, etc. Most everybody has blown an account or two before really getting serious.

Here's the thing: Either you're committed to do the hard work, take what you've learned, continue researching and learning and put it all together into a methodology which is uniquely your own, or you're going to fail. No one copy-cats in this business. You can be sitting next to the best trader in the world who shares all his/her secrets. But you have another thing coming if you think you're going to mimic his/her trades. It doesn't happen that way. Trading skill is an evolutionary process. You have to be persistent, particularly in the event of losses. If you're not in it, you can't win it.

About individual P/L's, what good is it to see someone else's profits or losses? You can't duplicate what that person is doing. And just because that person has "done it", doesn't mean YOU can do it too.

The most valuable education you can get in this business is free - it's here on this board, it's in webinars and other free tools easily found on the internet. It's people who are willing to share and answer questions. I share with people all the time and I'm happy to do it. But it's up to the individual to make it happen.

I've blown accounts and I've bought a lot of crap out there - but I consider all this as a learning experience - you always take away something - even if it's only learning what you should NOT do. I don't consider it a waste of time or money.

If we're speaking in generalities, this is all pretty good stuff. It was pointed out that not everyone is cut out to be a trader. Passion has a lot to do with it but many are so far behind the required level of patience and discipline that their odds of making it are practically nill...especially without considerable mentoring.

I believe a fair amount of sim trading is manditory. Trading is a skill and no skill is ever mastered without practice. In trading, practicing to hone your mechanical skills in live account trading is insanity. With a good trading system, market knowledge and the mastery of the mechanics, most traders can be taught to do well on practically any day they choose - in simulation. When they switch to trading "live", the wheels fly off. Why?

All the simulation in the world will not replicate true trading stress (emotions). A few traders are able to make the transition from sim to live and do ok. But they are such a small number that we must postulate that, as a general rule, ALL traders will blow up their first account. The psychological stresses will be so great and their defenses so weak that they will be virtually powerless to combat the urge to bend, twist, bust, mangle and break their rules. Everything they know works goes out the window. At the end of the day, after reviewing their "performance", the sickening feeling of despair and disbelief sets in and they hate themselves. But overcoming those mental monsters is another topic.

We can take a simple poll here to find out how many futures.io (formerly BMT) traders made a successful transition and never nuked their first account. If honest, I venture to say "not many". So, if we accept the postulate as overwhelmingly true, then the question is, "How much money do you want to lose?" $2500? $20,000? $100,000? You get to choose. Think of it as your "tuition" in Trading 101 to learn that "cowboying" trades doesn't work and, to succeed, you must settle down and start mastering yourself. If you give in to your emotions and break your rules even one time, you cannot call yourself a disciplined trader. Without total discipline there cannot be lasting success.

It has always puzzled me how traders will invest so much time and money in learning systems, but put virtually nothing into learning themselves.

If we're speaking in generalities, this is all pretty good stuff. It was pointed out that not everyone is cut out to be a trader. Passion has a lot to do with it but many are so far behind the required level of patience and discipline that their odds of making it are practically nill...especially without considerable mentoring.

I believe a fair amount of sim trading is manditory. Trading is a skill and no skill is ever mastered without practice. In trading, practicing to hone your mechanical skills in live account trading is insanity. With a good trading system, market knowledge and the mastery of the mechanics, most traders can be taught to do well on practically any day they choose - in simulation. When they switch to trading "live", the wheels fly off. Why?

All the simulation in the world will not replicate true trading stress (emotions). A few traders are able to make the transition from sim to live and do ok. But they are such a small number that we must postulate that, as a general rule, ALL traders will blow up their first account. The psychological stresses will be so great and their defenses so weak that they will be virtually powerless to combat the urge to bend, twist, bust, mangle and break their rules. Everything they know works goes out the window. At the end of the day, after reviewing their "performance", the sickening feeling of despair and disbelief sets in and they hate themselves. But overcoming those mental monsters is another topic.

We can take a simple poll here to find out how many futures.io (formerly BMT) traders made a successful transition and never nuked their first account. If honest, I venture to say "not many". So, if we accept the postulate as overwhelmingly true, then the question is, "How much money do you want to lose?" $2500? $20,000? $100,000? You get to choose. Think of it as your "tuition" in Trading 101 to learn that "cowboying" trades doesn't work and, to succeed, you must settle down and start mastering yourself. If you give in to your emotions and break your rules even one time, you cannot call yourself a disciplined trader. Without total discipline there cannot be lasting success.

It has always puzzled me how traders will invest so much time and money in learning systems, but put virtually nothing into learning themselves.

.
... not everyone is cut out to be a trader....

If we're speaking in generalities, this is all pretty good stuff. It was pointed out that not everyone is cut out to be a trader. Passion has a lot to do with it but many are so far behind the required level of patience and discipline that their odds of making it are practically nill...especially without considerable mentoring.

I believe a fair amount of sim trading is manditory. Trading is a skill and no skill is ever mastered without practice. In trading, practicing to hone your mechanical skills in live account trading is insanity. With a good trading system, market knowledge and the mastery of the mechanics, most traders can be taught to do well on practically any day they choose - in simulation. When they switch to trading "live", the wheels fly off. Why?

All the simulation in the world will not replicate true trading stress (emotions). A few traders are able to make the transition from sim to live and do ok. But they are such a small number that we must postulate that, as a general rule, ALL traders will blow up their first account. The psychological stresses will be so great and their defenses so weak that they will be virtually powerless to combat the urge to bend, twist, bust, mangle and break their rules. Everything they know works goes out the window. At the end of the day, after reviewing their "performance", the sickening feeling of despair and disbelief sets in and they hate themselves. But overcoming those mental monsters is another topic.

We can take a simple poll here to find out how many futures.io (formerly BMT) traders made a successful transition and never nuked their first account. If honest, I venture to say "not many". So, if we accept the postulate as overwhelmingly true, then the question is, "How much money do you want to lose?" $2500? $20,000? $100,000? You get to choose. Think of it as your "tuition" in Trading 101 to learn that "cowboying" trades doesn't work and, to succeed, you must settle down and start mastering yourself. If you give in to your emotions and break your rules even one time, you cannot call yourself a disciplined trader. Without total discipline there cannot be lasting success.

It has always puzzled me how traders will invest so much time and money in learning systems, but put virtually nothing into learning themselves.

RogerF:

Excellent post. 100% on target.

THE CHALLENGE

What can we, those who accept what you say, work as a community to help ourselves, to master ourselves?

All the posting, blogging, etc. won't do it. It might help others understand they have to do it but this activity by itself will not move us towards the goal of mastery.

It seems to me that there are aspects of trading that are like dieting. We read what the problem is; we read what the solution is; we buy books; we 'try' the latest 'fad'. And like trading, most dieters fail and for a lot of the same reasons. I believe there are programs like Weight Watchers that help those that have crossed a threshold of commitment. The individual still has to do the work and take responsibility but there is an 'active' support group in place to help.

It also occurs to me that people suffering from addictions like alcoholism benefit greatly from organizations like AA.

Assuming that at least some of you agree with this concept, what can we do to create such a support environment. What we have here in this forum is a great start but it is just a start (for some or most of us). I know I need to do more, a lot more, but I think I would get there quicker if I was able to get support and at least as importantly - give support to others. We help ourselves when we help others.

I have a lot more to add to this but I would like to see if there are some kindred souls to share with first.

Geoff

Interesting concept. Something like BTA..."Bonehead Traders Anonymous"...LOL.

Seriously, some type of support group might be of benefit but the problem is usually pretty stubborn. Many years ago I use to be a smoker. I tried everything under the sun to quit...and that was the problem. I was looking for an easy external fix to a big internal problem. I couldn't quit until I admitted the problem, realized what it was doing to me and those around me, and took a good whiff of myself. Then I had to reach way down and grasp every ounce of willpower I had in my being. I had to outlast the grasp that evil nasty habit had on me until it was out of my life forever. It took time and it took support from others...but a very special kind of support.

It was still a tough battle...but not as tough as breaking bad habits in trading. The urge to smoke eventually disappears but the urge to break rules and discipline never does. It's a constant struggle but it does get easier over time as good habits replace the bad ones and are reinforced daily.

Bad habits and negative reinforcement are the product of what's happening between our ears. I had a student once, Jim, who had a particularly hard time with his negative emotions when trading. I had him make a solemn pledge to trade by his rules, remain patient and disciplined, and totally justify every trade he took FOR JUST ONE DAY...IN SIMULATION! He just couldn't do it. He tried hypnosis, psychotherapy, relaxation techniques, etc. and nothing helped.

In trying to help him, it reminded me of my personal struggles and I could see he was looking for external "fixes" just as most people do in trying to overcome life's demons. For the longest time, he couldn't understand what I meant when I told him that the solution wasn't in reaching out...it was in reaching in...deep. But just "toughing it out" usually doesn't work...it takes guidance and support for many.

Today, Jim is one of the most disciplined traders I know and he'll be the first to tell you it wasn't easy by any means...and he didn't do it alone. He was fortunate enough to find a good Trader Coach who was not only a Doctor of Psychology but also a professional trader himself. He helped Jim to harness the human power that is within all of us to overcome his mental barriers...not by external fixes, but by internal strength. Skip the psycho babble mumbo jumbo that you hear so often. Perhaps a support group based on this concept could make a difference in some traders. I like the idea.

Know thyself and to thy own self be true.

There are many factors that determine success in trading. It is a good idea to check out you trading psychology.
Go to ultimatetradingpsychology.com Patrick has a good free 5 lesson course to get you started.

Of course!

The final frontier in trading is 'iron-willed' discipline with near-flawless execution and steely resolve.

Without it you should probably just work a real job.

Armed with it though; one gets to have the freedom that buying and selling money gives.

I still attend at least 1 archived or real-time webinar on psychology every week. I also see a trading psychologist approximately 20X's per year (I have traded full time for 27+ years now).

It is burned into my brain. Basically, successful traders brainwash (in a good way) themselves with repetition so that the concepts soak into the subconscious.

Every Sunday I skip that supernatural worship thing that some people do and read from my own good 'book(s)' on psychology and trade management and technical analysis.

This is what separates small-lot and/or marginal traders and those that then are able to trade size and create wealth over a significant amount of time (years).

There is no wealth without work. It begins within.

peace

Hedvig

I had a boss who used to regularly remind me of the old adage "if you're not part of the solution you are part of the problem!". Anyone can criticize but always propose an action when you do criticize.

The action I am proposing is the formation of a self-help group perhaps along the lines of Weight Watchers, Alcoholics Anonymous. The purpose of the group would be to develop a program and then support each other in that program to develop self discipline. The group doubled last week - from 1 to 2! Is anyone else interested?

Geoff

@geoff

am lazily interested, nevertheless interested.

beam me up and count me as #3 or just @2.5, K?

and put me in your linkage and loop, K?

thx for a great charitable idea and we'll see if it goes any where.

warm regards

<by the way, are you the same geoff who sometimes serves as technician answering some members' technical questions, in certain company, pls?>

success has much less to do with education and much more to do with discipline and the right mindset.
Discipline will lead to consistency. With even a modicum of consistency, patterns in your behavior can be identified and adjusted. Without some sort of consistency, it is impossible to improve as a trader since your results will essentially be random. If your results are random, you can't even identify problems much less correct them.
This is why everyone says you must keep a trade journal & log all of your trades. But I can tell you, if you don't stick with one method and trade it consistently, that trading journal is useless.
Most all traders want instant success or they have unrealistic goals. This leads them to "system search". They will try a system for a few days or weeks and if their expectations aren't met, they will move on, assuming that the system is the reason they are not making money. The reality is that poor behavior patterns are the reason they fail. But without sticking with one system long enough, those patterns never have a chance to reveal themselves.
Sooner or later you have to admit that the only common denominator in all of the failed systems you tried is you. Once you can fully embrace this, then you can stick with one system, even if you consistently lose, long enough to start seeing the behavior patterns that are causing you to lose. Only then can you stand a chance at correcting the true weak link in your trading... and it has nothing to do with how much you have spent on education.

i think the person that made the post had a point. the trading educators that sold him all of that over price b.s. told some fairy tails along the way. we have all herd the same bed time storys. is there any one on this forum that trust trading vendors. any thing sold by a trading vendor should there not be a big red stamp ..buyer be ware and some a skull an cross bones. i fell sorry for the guy..

Hope you are trading well.
Your pessimism and negativity is overflowing in this entire vendors section.
Can you please consider using punctuation in your posts? It will make it easier to follow and understand.

if you disagree.. post and point out the part that is not true.