I’m looking for honest answers. I don’t care what the gurus and system sellers say, trading is hard, really really hard. Also I’m no rookie, 7 years into this with very serious effort and education on trading. Anyone who says different is either brand new or trying to sell you something. I think the biggest reason is that our emotions get in the way of us executing our strategy. Idea to make it easier,,, only trade first 3 hours of day. How about you? What do you think makes trading so hard? And what is your best idea to make it easier.
Most trading, except those that have an arb strategies, are trying to predict the future based on the the past and present data sets of information. Then you are making assumptions that what happened in the past, will repeat that pattern over the same time period that happened before. The problem is that the future is unpredictable. You can't be right all the time and the past does not repeat in the same way all the time. You need to find a process to use the past to be right more than wrong and manage your risk, to be around to be right again. That requires good information, a good process to use that data, discipline and enough money to be wrong. Too many trader do not have enough of each to make it.
Trading is hard because sometimes the next 10, 20, 50 or even 100 trades might not net you any money even if you execute your trading perfectly, even with perfect emotional control, you still might not have a profit to show after 50+ trades. At the end of the day you have total control of when to enter, but it is the market that decides if that entry will be profitable or not. Sometimes the next 50+ trades will print money at other times you will be lucky to break even. As a trader you sometimes live on the extreme negative end of the bell curve for protracted periods of time. And there is nothing you can do about it expect maybe trade smaller.
The first reason is because there is a finite amount of money. You can't create money in the market, it has to come from someone else's pocket (unless you are investing in cooperate retained earnings). Then you have to think how the market evolves. The smart people will make money and grow while the not as smart people will die out. So you are trading in a place that is dominated by the smartest people/computers. Lastly, from reading alot of comments on this site, people are trying to ski with a snowboard. Of course that will be hard! You should not trade in an enviornment/ a strategy where you do not have the right tools. So many people want to become day traders using tools/ideas from the 1970's. Imagine doing the electrical work in a house with a screw driver vs a plug in drill vs a cordless 18 brush Milwaukee. The guy using the screw driver will be like "damn this is hard" while the guy using the cordless 18 brush Milwaukee will be working on the second home and most likely his second (much better looking) wife. Ps. Emotions are so last century, I think that is the least of a modern traders problems
Playing the violin at concert level is hard, some get there easy, most never do. Trading may the labours of Hercules for some and a pleasure for others like anything that requires a certain born talent. Anyway, my world is largely scalping futures and any monkey (me included) can do that as long as they don't get anxiety.
When I decide to make a trade...which at times comes very quickly many times in-tra-day: 1. I trade 99% of the time with other traders money. i.e. I don't borrow margin money directly ever unless I'm forced to... & yes that does happen but rarely. The worst thing that can happen is I may have to hold a security until it becomes profitable. Example now in one of my trading accounts I'm holding AAPL Raw longer than I'd like, but even APPL has secondary income i.e. a dividend. I never make a trade with a security that doesn't have multiple potential for profit. 2. I make trades that if & when they go wrong have an out with a secondary method of making money even when the primary profit target goes against me. An Example might be: Being exercised (put) shares when the strike price & or expiration date box me in. 3. Never trade with more downside risk than you & your account can handle. 4. You must learn to sleep in the Red, trade with emotion if that's what it takes for you, but be willing to shake the downsides off quickly & modify your trade....they will come. 5. You must be willing to trade, & make modifications at any time during the trades lifespan. 6. Some of the best option trading opportunities (fills) come about during highly volatile moments during the trading day. If your "watching" those triggers will become apparent. 7. The most important thing for me about trading is: I only trade very historically predictable securities.
Positive mindset comes from positive expectancy . Most people think their problems are emotions , losing is emotional no doubt . But i think most peoples issues come from a lack of an emperically proven rules based edge that is repeatable . You probably dont need Mark Douglas , most likely you need some sort of quantitative , systematic training . Maths Every trader new or old should read Thinking, Fast and Slow — By Daniel Kahneman You need to have an idea of what to do before it happens , thinking logically in the moment is difficult . All important decisions should not be made under stress . Know what you will do under a set of circumstances before it happens , be a machine with no prejudice or biases . Fear and anger have no place in trading
Post a couple of your losing trades here with entries and exits here: https://www.elitetrader.com/et/threads/losing-trades-archive.290695/ You might get some insightful input on your trading plan and then be in a position to reassess. A good trading plan should have you up decent after 10 trades..
Live trading is mainly about emotion / mind control. No doubt about that. Even if we have the holy grail for trading, it doesn't mean trading is going to be easy. How market is going to move & behave is totally unpredictable and beyond our control. Look at 24 Oct during US sesion. Market went down alot but very difficult to profit from such chaotic erratic market. If we try to day trade and short the market even though it is with trend, very easy to lose tons of money due to spiky market movement. I don't like such market ; market moved alot but difficult to profit from it. So I have to adapt to changes. If you see my ET Journal, I have to think of alternatives to profit from such market. and this challenge will continue .... Generallly I trade first 2 or 3 hours of trading session. However, past 2 weeks, market temperament / behavour ... changed. Signals could come anytime.