An emotional trader’s strategy is simple: buy high, sell low, and panic in between.
You will never master the market; all you can do is master your behavior.
Have high standards for stock selection. If you can’t find any stocks that meet your standards, don’t trade. Never lower your standards in marriage, with business partners, or with friends. winners don’t settle. Be a winner.
90% of success comes from doing the right consistent work.
Trading when you need to make money never works. Get your finances in order and then come to the charts. Trying to squeeze your income from the charts is only going to dig you into a deeper hole.
Winning solves everything.
A get-rich-quick attitude will keep you broke.
Too many people want to be a victim of something.
You must choose one of two pains: 1) The pain of discipline. 2) The pain of regret.
Whether you win/lose, always review your trades. It only takes a few minutes. There is always something to be learned from every trade you make.
When you focus on a good process, Great things can happen.
Nothing is free, everything costs you something, Attention, time, energy, etc.
Technical analysis skills can make you profits but only risk management skills can keep those profits.
The fastest way to lose your whole trading account is to try to quickly double it.
It costs $0.00 to wait for a good trading signal.
The greatest edges rich traders have over unprofitable traders are discipline, patience, perseverance, & a quantified winning system.
You can’t take all your emotions out of your trading, all you can do is put discipline in.
Trading doesn’t just reveal your character, it also builds it if you stay in the game long enough.”
Humans are not machines. They analyze information through the lenses of their experience, knowledge, and cognitive biases. All of it makes their perception, their unique viewpoint.”
“Whatever anybody does or does not do is based on either greed or fear.”
“Identical information can lead to opposite conclusions based on relative perceptions of its receivers.”
“Greed pulls people in, and fear pushes them out.”
The only shortcut in trading is to start with system development.
Profitable trades are usually in the opposite direction of the natural human impulse.
Personal finance is 10% math and 90% behavior.
Knowledge is just information; only practice and experience can create skills.
“One emotionally-driven investment that causes massive losses is enough to keep you away from all investments for life.”
“You must not be a seller if not a buyer in a massive downturn.”
“If an increase in price makes you happy, surely a price drop will make you sad.”
“One emotionally-driven investment that causes massive losses is enough to keep you away from all investments for life.”
“Somehow, we believe that we have a better chance of winning a game of probabilities, totally disregarding that everybody who is playing the game has the same possibility of winning.”
stop trying to find excuses for your lack of discipline. Your equity curve doesn’t lie.
“A thing appears random only through the incompleteness of our knowledge.”
You don’t have to be brilliant, only a little bit wiser than the other guys, on average, for a long time.
“The combination of our natural desire to be better than our peers, our faulty assumption of dodging risk, and our flawed belief of having better chances than others, pushes us into excessive greed territory. We take more significant and sometimes fatal risks.”
“Investments are not a lottery; if it feels like the lottery, stay away from it.”
“If your plan is to sell your holdings to another person at a higher price, then it is not an investment. It is gambling on finding a bigger idiot. What if the biggest idiot that can be found is you?”
“Once you have a plan, always invest within the boundaries and parameters of your plan. Never bend your rules to accommodate your guts.”
“Never bend your rules to accommodate your guts.”
“Greed and fear are both good and healthy for an investor and capital markets as a whole. Emotions are like fire, beneficial if controlled, destructive if wild.”
“Always remember that the minority dictates the prices, and the majority governs the value.”
“Have a plan. In writing.”
“Having access to better information is not synonymous with better decisions.”
“This tendency of overconfidence and poor outcomes is not confined to only retail investors. Institutional investors suffer from overconfidence equally if not more, and their investment results are not superior either.”
“A trader needs to be highly skilled and extremely lucky to beat the market consistently. If a trader is highly skilled but not lucky enough or extremely lucky but modestly skilled, he will beat the market occasionally but not consistently. Traders that are modestly skilled and modestly lucky will briefly beat the market but will be behind the market most of the time. Everybody else will lose money on a long-term basis, that is, 90% of the traders.”
“If a strategy is widely available for free or is offered on a small payment can never work. A secret is not a secret if a YouTube commercial offers it for a small payment of a hundred dollars.”
“Most of the traders think and act like gamblers. They believe that they can outsmart the rest of the players with the help of a trading system. They take investing as a game, and daily quotes are their scorecards.”
“Trading is not only a zero-sum game but an aggregate negative after deducting the trading cost and research expenses. Somebody’s gain is somebody’s loss, so the professional traders win the game because they have significant advantages over retail traders.”
“Traders and investors are humans, full of emotions, behavior biases, and good and bad past experiences. We don’t have much control over psychological shortcomings, and we routinely make decisions contaminated with our emotions and biases.”
“Traders and investors are humans, full of emotions, behavior biases, and good and bad past experiences. We don’t have much control over psychological shortcomings, and we routinely make decisions contaminated with our emotions and biases.”
“I am sure some people are very skilled, and trading comes easy for them, but it is a game of chance for most of us.”
“People like to risk pennies to win dollars.”
“Fear of missing out is more powerful than fear of losing.”
“If the prices were the motivation for buying, all future behavior and decisions would be based on price action.”
“The mind is a fascinating instrument that can make or break you.”
“The expectation that you bring with you in trading is often the greatest obstacle you will encounter.”
“In order to succeed, you first have to be willing to experience failure.”
“There is a huge amount of freedom that is derived from not fighting the market.”
Once you find the system that works for your style/personality and confidence is gained, wash, rinse, repeat over and over again.
The goal of a successful trader is to make the best trades. Money is secondary.
You have to identify your weaknesses and work to change them. Keep a trading diary – write down your reasons for entering and exiting every trade. Look for repetitive patterns of success and failure.
It’s not what we do once in a while that shapes our lives. It’s what we do consistently.
It’s hard to beat a person who never gives up.
An investment in knowledge pays the best interest.
“When you learn to let go of the need to be right, being wrong gradually loses its power to disturb you.”
“Fear, inherently, is not meant to limit you. Fear is the brain’s way of saying that there is something important for you to overcome.”
In trading/investing, it’s not about how much you make but rather how much you don’t lose.
Timing, perseverance, and ten years of trying will eventually make you look like an overnight success.
Trade What’s Happening… Not What You Think Is Gonna Happen.
Cut your losses. Cut your losses. And cut your losses. Then maybe you have a chance.
Before I enter a trade, I set stops at a point which the chart sours.
I set protective stops at the same time I enter a trade. I normally move these stops to lock in a profit as the trend continues.
If you can’t take a small loss, sooner or later you will take the mother of all losses.
Chart patterns are very accurate.
You don’t make money by trading, you make it by sitting. it takes patience to wait for the trade to develop, and for the opportunity to present itself. Let the market come to you, instead of chasing the market. Chart patterns are very accurate. They have proven their accuracy and predictability time and time again, but you have to wait for them to develop.
It’s not whether you’re right or wrong that’s important, it’s how much money you make when you’re right and how much you lose when you’re wrong.
Accepting losses is the most important single investment device to ensure the safety of capital.
In order to win as a contrarian, you need perfect timing and the perfect size.
Patterns don’t work 100% of the time. But they are still critical because they help you define your risk. If you ignore patterns and focus on hunches, feelings, and hot tips, just forget about achieving consistency.
Take your profits or someone else will take them for you.
I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime.
If it’s obvious, it’s obviously wrong.
If you want real insights that can make you more money, look at the scars running up and down your account statements. Stop doing what’s harming you, and your results will get better. It’s a mathematical certainty!
Limit your size in any position so that fear does not become the prevailing instinct guiding your judgment.
The hard work in trading comes in preparation. The actual process of trading, however, should be effortless.
There are a million ways to make money in the markets. The irony is that they are all very difficult to find.
Don’t blindly follow someone, follow [the] market and try to hear what it is telling you.
Frankly, I don’t see markets; I see risks, rewards, and money.
If you can learn to create a state of mind that is not affected by the market’s behavior, the struggle will cease to exist.
You create your own game in your mind based on your beliefs, intents, perception, and rules.
A great trader is like a great athlete. You have to have natural skills, but you have to train yourself how to use them.
It’s OK to be wrong; it’s unforgivable to stay wrong.
Trading is a waiting game. You sit, you wait, and you make a lot of money all at once. Profits come in bunches. The trick when going sideways between home runs is not to lose too much in between.
Don’t focus on making money, focus on protecting what you have.
The secret to being successful from a trading perspective is to have an indefatigable and undying and unquenchable thirst for information and knowledge.
Do not be embarrassed by your failures, learn from them and start again.
You don’t need to trade often. If you can catch one or two moves to the targets during the day with good size, you can make a good living and keep trading costs down.’
You never know what kind of setup [the] market will present to you, your objective should be to find an opportunity where the risk-reward ratio is best.
Never confuse your position with your best interest. Many traders take a position in a stock and form an emotional attachment to it. They’ll start losing money, and instead of stopping themselves, they’ll find brand new reasons to stay in. When in doubt, get out!”
It was never my thinking that made the big money for me, it always was sitting. Money is made by sitting, not trading.
Markets are never wrong, but opinions often are.
Don’t test the depth of the river with both your feet while taking the risk.
Trading effectively is about assessing probabilities, not certainties.
“There are no guarantees in trading. The sooner you accept that you sooner you can release your expectations and focus unconditionally on a proven process.”
“You become fearful the moment you identify with fear. But once you begin seeing it as an impersonal changing phenomenon, you become free.”
“You have power over how you’ll respond to uncertainty.”
“Money is just something you need in case you do not die tomorrow. Let this is a reminder for you not to obsess over profits and losses. In whatever you do, strive for enjoyment, focus, contentment, humility, and openness… Paradoxically (and as an unintended consequence) your trading performance will improve significantly.”
“A quiet mind is able to hear intuition over fear.”
“Don’t ever make the mistake of believing that market success has to come to you fast. Trade small, stay in the game, persist, and eventually, you’ll reach a satisfying level of proficiency.”
“Win, loss whatever emerges in the short-term, place and manage your next trades untouched, unattached… always keeping your eyes on the long-term picture.”
Only the game, can teach you the game.
The obvious rarely happens, the unexpected constantly occurs.
The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.
Hope is bogus emotion that only costs you money.
“Ultimately, consistent profitability comes down to choosing between the discomforts you feel when you follow your plan and the urge to let yourself be captured ( and ruled) by your emotions.”
“Trading effectively is about assessing probabilities, not certainties.”
“You should never test the depth of the water with both feet.”
“Humans’ reactions are contaminated with their cognitive biases, greed, fear, and survival instinct. However, capital market success requires precisely the opposite behavior of what your intuition is suggesting.”
“The most important thing is to invest and buy shares in successful businesses. The second most important thing is to buy right and not pay excessive amounts.”
“Markets can be volatile from time to time; however, stock prices follow earnings accumulation over the long term.”
“The market’s long-term trajectory is upward, which is the only direction the market can go over a long period.”
“The actual risk is the permanent loss of capital or, to a lesser extent, a sub-par return. Temporary volatility in market price is not a real risk.”
“Confidence is not “I will profit on this trade.” Confidence is “I will be fine if I don’t profit from this trade.”
