You are on to something here. Do your own thinking and, first of all, forget about Ripley. I understand now why he cannot make it. The only thing I don't understand is what he is doing on trading message board.
A list of the fifty most common reasons (out of a million) why all futures traders lose money. We surveyed more than a thousand experienced futures brokers and asked what, in their experience, caused most futures traders to lose money. These account executives represent the trading experience of more than 20,000 futures traders. In addition, most of these Account Executives (AEs) have also traded or are currently trading for themselves. Their answers are not summarized because different traders make (and lose) money for different reasons. Perhaps you may recognize some of your strengths and weaknesses. Yet, many of the reasons given are very similar from broker to broker and client to client. The repetitions stand to demonstrate that, alas, many futures traders lose money for many of the same reasons. Perhaps these statements from experienced brokers can make a contribution to you, who make this sometimes fickle, often intricate, always interesting marketplace of futures trading possible. Here is what they said: 1. Many futures traders trade without a plan. They do not define specific risk and profit objectives before trading. Even if they establish a plan, they "second guess" it and don't stick to it, particularly if the trade is a loss. Consequently, they overtrade and use their equity to the limit (are undercapitalized), which puts them in a squeeze and forces them to liquidate positions. 2. Usually they liquidate the good trades and keep the bad ones. Many traders don't realize the news they hear and read has, in many cases, already been discounted by the market. 3. After several profitable trades, many speculators become wild and unconservative. They base their trades on hunches and long shots, rather than sound fundamental and technical reasoning, or put their money into one deal that "can't fail." 4. Traders often try to carry too big a position with too little capital, and trade too frequently for the size of the account. 5. Some traders try to "beat the market" by day-trading, nervous scalping, and getting greedy. 6. They fail to pre-define risk, add to a losing position, and fail to use stops. 7. They frequently have a directional bias; for example, always wanting to be long. 8. Lack of experience in the market causes many traders to become emotionally and/or financially committed to one trade, and unwilling or unable to take a loss. They may be unable to admit they have made a mistake, or they look at the market in too short a timeframe. 9. They overtrade. 10. Many traders can't (or don't) take the small losses. They often stick with a loser until it really hurts, then take the loss. This is an undisciplined approach...a trader needs to develop and stick with a system. 11. Many traders get a fundamental case and hang onto it, even after the market technically turns. Only believe fundamentals as long as the technical signals follow. Both must agree. 12. Many traders break a cardinal rule: "Cut losses short. Let profits run." 13. Many people trade with their hearts instead of their heads. For some traders, adversity (or success) distorts judgment. Thatâs why they should have a plan first, and stick to it. 14. Often traders have bad timing, and not enough capital to survive the shake out. 15. Too many traders perceive futures markets as an intuitive arena. The inability to distinguish between price fluctuations which reflect a fundamental change and those which represent an interim change often causes losses. 16. Not following a disciplined trading program leads to accepting large losses and small profits. Many traders do not define offensive and defensive plans when an initial position is taken. 17. Emotion makes many traders hold a loser too long. Many traders don't discipline themselves to take small losses and big gains. 18. Too many traders are underfinanced, and get washed out at the extremes. 19. Greed causes some traders to allow profits to dwindle into losses while hoping for larger profits. This is really lack of discipline. Also, having too many trades on at one time and overtrading for the amount of capital involved can stem from greed. 20. Trying to trade inactive markets is dangerous. 21. Taking too big a risk with too little profit potential is a sure way to losses. 22. Many traders lose by not taking losses in proportion to the size of their accounts. 23. Often, traders do not recognize the difference between trading markets and trending markets. -------------------------------------------------------------------------------- Lack of discipline is a major shortcoming. -------------------------------------------------------------------------------- 24. Lack of discipline includes several lesser items; i.e., impatience, need for action, etc. Also, many traders are unable to take a loss and do it quickly. 25. Trading against the trend, especially without reasonable stops, and insufficient capital to trade with and/or improper money management are major causes of large losses in the futures markets; however, a large capital base alone does not guarantee success. 26. Overtrading is dangerous, and often stems from lack of planning. 27. Trading very speculative commodities is a frequent mistake. 28. There is a striking inability to stay with winners. Most traders are too willing to take small profits and, therefore, miss out on big profits. Another problem is undercapitalization; small accounts can't diversify, and can't use valid stops. 29. Some traders are on an ego trip and won't take advice from another person; any trade must be their idea. 30. Many traders have the habit of not cutting losses fast, and getting out of winners too soon. It sounds simple, but it takes discipline to trade correctly. This is hard whether you're losing or winning. -------------------------------------------------------------------------------- Many traders overtrade their accounts. -------------------------------------------------------------------------------- 31. Futures traders tend to have no discipline, no plan, and no patience. They overtrade and can't wait for the right opportunity. Instead, they seem compelled to trade every rumor. 32. Staying with a losing position, because a trader's information (or worse yet, intuition) indicates the deteriorating market is only a temporary situation, can lead to large losses. 33. Lack of risk capital in the market means inadequate capital for diversification and staying power in the market. 34. Some speculators don't have the temperament to accept small losses in a trade, or the patience to let winners ride. 35. Greed, as evidenced by trying to pick tops or bottoms, is a frequent error. 36. Not having a trading plan results in a lack of money management. Then, when too much ego gets involved, the result is emotional trading. 37. Frequently, traders judge markets on the local situation only, rather than taking the worldwide situation into account. 38. Speculators allow emotions to overcome intelligence when markets are going for them or against them. They do not have a plan and follow it. A good plan must include defense points (stops). 39. Some traders are not willing to believe price action, and thus trade contrary to the trend. 40. Many speculators trade only one commodity. 41. Getting out of a rallying commodity too quickly, or holding losers too long results in losses. 42. Trading against the trend is a common mistake. This may result from overtrading, too many day-trades, and undercapitalization, accentuated by failure to use a money management approach to trading futures. 43. Often, traders jump into a market based on a story in the morning paper; the market many times has already discounted the information. 44. Lack of self-discipline on the part of the trader and/or broker creates losses. -------------------------------------------------------------------------------- Futures traders tend to do inadequate research. -------------------------------------------------------------------------------- 45. Traders don't clearly identify and then adhere to risk parameters; i.e., stops. 46. Most traders overtrade without doing enough research. They take too many positions with too little information. They do a lot of day-trading for which they are undermargined; thus, they are unable to accept small losses. 47. Many speculators use "conventional wisdom" which is either "local," or "old news" to the market. They take small profits, not riding gains as they should, and tend to stay with losing positions. Most traders do not spend enough time and effort analyzing the market, and/or analyzing their own emotional make-up. 48. Too many traders do not apply money management techniques. They have no discipline, no plan. Many also overstay when the market goes against them, and won't limit their losses. 49. Many traders are undercapitalized. They trade positions too large, relative to their available capital. They are not flexible enough to change their minds or opinions when the trend is clearly against them. They don't have a good battle plan and the courage to stick to it. 50. Don't make trading decisions based on inside information. It's illegal, and besides, it's usually wrong.
all this stuff could have been summed up in a couple of sentences....47 points just to repeat the obvious ad nauseam..yeah very original and insightful.
Every single one of these "tips" is a goldmine. The problem is that you don't understand them until you do. They have substance, but are hollow. nitro
romik.........yes, thanks that is somewhat comical, but let's say more optimism than realistic...just typical lack of experience in the market you planned to conquer at that time...but at the time you believed that...you are still moving in the right direction........still believing as progress builds confidence........confidence is the most important word in my trading vocabulary.......nothing good happens for long without it.......built on trust....if u trust your approach/strategy/system/etc........you have seen it work enough that confidence is in an ever growing mode.........thanks mr romik.....positive posts like yours are a pleasure......porgie
Agreed, one's gut response in dealing with these "issues" is to tackle them in isolation, when in fact just about all of those listed get "solved" simultaneously, once a certain understanding is achieved.
Sounds like the chorus to kumbaya There are no barriers to entry in trading, so anyone can do it. That's why so many fail. What do you think the state of the medical profession would be like if getting your MD was as easy as passing a driving test? Think about how easy it is to pass a driving test and then think about how many people die in auto accidents. What % of auto accidents do you think are caused by driver negligence? More morons behind a trading station is GOOD. STOP trying to convince losers that they can't make it trading. Trading is not for everyone, just like motorcycle racing isn't for everyone. Just like the special forces isn't for everyone. I've been posting on this site for a few months now and its apparent to me that the majority of the people who post here are fvcking idiots with a distorted sense of reality/self-image. Differing opinions is one thing, but lack of ability to reason logically or rationally and analyze basic information is a guarantee of failure in trading. This is an accurate description of many posters here on ET. Can anyone recommend a better forum or site to follow? There has to be a forum that is actually respected by real traders who have been making money in the markets consistently for years. For some people, failing and being unsuccessful are merely symptoms of deeper psychological and/or emotional issues of varying severity. They will fail at most other entrepreneurial endeavors in which you have to rely on yourself to become successful and cannot rely on an authoritarian systems and/or handlers to wipe your chin then wipe your ass. I'm beginning to see "the light" as far as my efforts in the ag, metal and equity futures markets. I'm sorry to say that as my quality of life mproves and my opportunity cost to post here increases, i will post less. Eventually posting very infrequently or not at all. Amazing to me how some of you manage to stomach sticking around and dealing with all of the idiots who pass through this turnstile. I'm not an a$$hole or some tool. I just think that if your goal is to help people become profitable faster, you should stick to helping real people you can work with everyday, rather than morons on the internet who will fail at trading because of fundamental issues that they most likely will not correct. Most good raders get this and that's why there aren't that many of them on sites like this. Which leads alot of fools like Ripley to believe that they don't exist. I'm not one to shy away from conspiracy theories, but to actually believe that broker-exchange manipulation bullshit is a stretch. Even though there IS collusion, there are also consistently profitable traders. I'm no guru, but one valuable piece of advice that I found extremely valuable and turned around my trading was reading Victor Sperandeo's "Trader Vic" books (Ripley pay attention). If you are not yet profitable, read them. If you can't begin to figure out how to profit in the markets after reading those books and making a real effort to employ the principles taught...? Don't worry, just KEEP TRADING ; ) a brand new trader