When things go against you – part 2
Thinking about the markets from the market’s perspective can remove fear from the equation by creating a belief that down markets are a necessary part of market behaviour in the future and just as tradable as low market risk periods. If you think from the paradigm of your business, your job objectives or from your […]
When things go against you – handling drawdown
Research shows that the average down market lasts three to four months. However, it is not the short-lived down market periods that active investors should worry about, but the occasional longer and sustained down market periods, such as the one we are now experiencing. All ‘long’ strategies, whether they are Buy & Hold or more […]
How low can the All Ords go?
This week I have moved away from psychology training as I feel that it is important to add my commentary on the current market conditions. I’m not one to normally predict the direction of the market. To be honest I don’t get caught up in the economic noise or the negative press articles on the […]
Right mindset – Part 3
A competitive mindset will take you out of flow with the market and cause you to try to control and beat the market with whatever means you have. The typical weapons of choice are analysis and trying to predict price movement to prove that you were right and the market was wrong. Many novice traders, […]
Right mindset – Part 2
Because loss trades simply must occur, it must be accepted that it is impossible to achieve a trading record that only comprises profit trades—that is, a perfect trading record. Once this is accepted, it must follow that perfection or certainty for every trade is unattainable and that traders are therefore dealing within a probabilistic environment. […]
Right mindset
Thinking from the markets perspective means forming connected ideas about what and when to buy and sell from the view of the facts and events in the market. The facts and events are movements of price in tradable instruments. If your perspective causes either positive or negative emotional feelings in you about the price movements, […]
Processes and outcomes
Once you have accepted achieving consistency as your major skills goal, what other skills goal can you set? Perhaps you could set a goal to become the ‘perfect trader’. What would this mean – no losing trades? Is this possible? I can assure you, it is not. Randomness will take care of this. A perfect […]
Achieving consistency and objectivity
In last week’s post I discussed the concepts of consistency and objectivity in relation to the market and our trading and active investing activities. Over the next few week’s I will be taking a look at how we can achieve these skills that are essential to our long term success in the markets. While it […]
Consistency and objectivity
I believe from my own trading experiences, from reading material by many trading authors and from reading Mark Douglas’ books and discussing the subject with him in the past that our primary trading goal must be to achieve consistency and objectivity in our trading and investing activities. Why? To explain, let’s start by defining these […]
The ultimate challenge
The last few months have been extremely tough going for medium term active share investors. This has been exacerbated this past week with a rapid increase in volatility and the markets once again moving into a high risk phase. Events such as these are not un-common in the markets and as traders and active investors […]