Discipline

Trading is often about how to take the appropriate risk without exposing yourself to very human flaws.
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cmuddle
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This is another question about a good mindset for trading.
Would you agree that about 90 % of being a successful trader lies in the discipline?

I see it in myself that after a couple of bad trades I tend to overstake which comes from despair.
If I wouldn't do that I would do much better because I could catch up the next day or even same day.

Somewhere I have read that it is connected with emotional pain that one experiences during bad trades and when trading in general and that it prevents one from clear thinking, the brain just shuts the incoming information.
I can observe that in myself but cannot always find the will and strength to overcome that.

How do you work with this?
Would appreciate you sharing your experience and thoughts about this.

Thanks a lot
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northbound
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cmuddle wrote:
Tue Apr 30, 2019 1:22 pm
Would you agree that about 90 % of being a successful trader lies in the discipline?
No.

To me it’s 50% discipline, 50% finding profitable angles.

Discipline to me is way easier than finding profitable angles. Like it’s way easier to work as an employee rather than creating and running a PROFITABLE company by yourself.
dt888
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cmuddle wrote:
Tue Apr 30, 2019 1:22 pm


I see it in myself that after a couple of bad trades I tend to overstake which comes from despair.


I often find its the opposite for me. Bad races and mistakes tend to focus me, but when things are going really well I will often push a bit harder and end up making mistakes that way
iambic_pentameter
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Without doubt, the hardest part of the trading puzzle and I can relate to both cmuddle and DT888.

The best traders have worked on their craft to the point where, if you were sat next to them, you wouldn't know if they were up or down on the session.

That is the ideal.
spreadbetting
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It'd probably help if you stopped looking at losing trades as bad trades. Until you can accept losing trades are part of the game you won't get anywhere and just because a trade loses doesn't even mean it was a poor entry. You simply can't predict what others will do in the market and many times you'll come out on top from a poor entry the same as a good entry may end up in a loss.

I think the only thing you can do is take yourself out of the situation after any losses that might trigger your chasing then come back when you've calmed down. Missing a few races isn't a big deal and you may find those 'time outs' start getting shorter each time.
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Derek27
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cmuddle wrote:
Tue Apr 30, 2019 1:22 pm
Would you agree that about 90 % of being a successful trader lies in the discipline?
It depends on how much lack of discipline affects trading. A trader who lets bad trades go in-play with huge liabilities, it may be near 100% about discipline. For traders who have the occasional lapse, considerably less.
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ruthlessimon
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What massively helps me remain disciplined, is knowing roughly what I'm expected to lose; & this removes huge amounts of pressure.

Having knowledge that - If the edge performs as expected, I will be down -£XXXX.XX (at some point) - fact - unavoidable.

I know my number inside out; & I am mentally prepared to lose that amount of money (possibly a bit more) - before I start trading anything

Very recently, this allowed me to push through a pretty substantial drawdown (lost something like 10 trades in a row); but I was well inside the expected drawdown - I continue executing unchanged - & then I hit 10 winners in a row (one of the many pains of a 55% strike rate :roll: )

But having the drawdown stats, forces me to be disciplined.

Objective; none of this self-help shite!!
iambic_pentameter
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spreadbetting wrote:
Tue Apr 30, 2019 3:03 pm
It'd probably help if you stopped looking at losing trades as bad trades. Until you can accept losing trades are part of the game you won't get anywhere and just because a trade loses doesn't even mean it was a poor entry. You simply can't predict what others will do in the market and many times you'll come out on top from a poor entry the same as a good entry may end up in a loss.

I think the only thing you can do is take yourself out of the situation after any losses that might trigger your chasing then come back when you've calmed down. Missing a few races isn't a big deal and you may find those 'time outs' start getting shorter each time.
SB - good advice and thank you for sharing.

Given that you've been doing this for some time now, how long did it take you to get to that point?

Iambic
Emmson
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cmuddle wrote:
Tue Apr 30, 2019 1:22 pm
This is another question about a good mindset for trading.
Would you agree that about 90 % of being a successful trader lies in the discipline?

Something like that figure YES! .....and once you have got discipline its a constant battle to keep it.
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ShaunWhite
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cmuddle wrote:
Tue Apr 30, 2019 1:22 pm
I see it in myself that after a couple of bad trades I tend to overstake which comes from despair.

Somewhere I have read that it is connected with emotional pain that one experiences during bad trades and when trading in general and that it prevents one from clear thinking,
To slightly echo what SB said, when you say 'bad trade', do you simply mean a losing trade or a trade where you've made a mistake?
If it's just a losing trade then so what, they happen, but if you're making execution mistakes then that's a different issue.

In general though if you have full confidence in your edge and a history long enough for you to know how many you'll likely lose, and how big those losses should be then life will be much easier. Being tempted to stray from your plan only happens when you stop believing in your strategy to such a massive extent that you think one made up on the fly would be better.

If you're feeling dispair and out of control it might not be that suprising because you've been told to feel like that. The trading educators will constantly tell you that losing is your fault because you don't have the fortitude to stay resolute, when imo it's more likely that you simply don't actually have an edge yet. It sounds like you've fallen for this 'its your fault for being weak' line too. Fix that 'discipline' and you'll get rich they say, but if you fail to completely reprogram your personality and 30,000 years of human nature then it's your fault, and by extension, not theirs. If a megatrader wins day in and day out then he's not doing it via some mystical psychological strength that you haven't got, he doing it because he's got edges and enough zeros in the bank to tell him they work, even with the losses. The successful traders I've known (city and sports) aren't special people, they're just regular people who've got good at something, usually through hard graft just like everyone else.

Apologies if my reply rambles and repeats even more than usual, i've just spent the last 18hrs in hospital being pumped with morphine and i'm more than a bit tired and wired :shock: Getting home and sitting at my screens straight away (albeit just watching the bots and looking at the forum) makes me wonder if I'm as addicted to this as those people who need to trade on holiday! ;) Speaking of holidays, all that mophine was a response to a mini heart attack.....we have holidays for a reason you know, and it's not to ensure you're the richest, brownest resident of the boneyard. Although tbf that does sound like a challenge rather than a warning :)

...time for a kip I think, but stop worrying you're not an android and instead develop a technique you can lean on when times look tough.
spreadbetting
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iambic_pentameter wrote:
Tue Apr 30, 2019 4:19 pm


SB - good advice and thank you for sharing.

Given that you've been doing this for some time now, how long did it take you to get to that point?

Iambic
Think I only really got there when I started taking it seriously to make a living from trading, prior to that I think it's hard to maintain the discipline needed when you're doing it for fun and the money means little.

The fact I was running unmanned bots was a help as that lets you see the bigger picture with regards to losses but even now it's hard to avoid those 'sod it' moments especially when you hit a big loss from a stupid error. For me the only way is to remove myself from the markets and do something else til I'm ready to get back on board. Probably only takes me a race nowadays but you've got to stop yourself from going off plan at all costs because in the long run it just reinforces bad habits as some will always go your way. Unless you're consistent with your approach you'll never really know where you're winning or losing money in the long run and taking a short break is very easy to do.
iambic_pentameter
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Great advice again - thanks, SB.

Iambic
trader44
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Great thread discipline is one of my favourite subjects in trading ..i think after a loss or series of losses defo better to take a break walk and get some space if you have a tendency to implode :oops you have to be mentally strong to cope with the ups and downs of trading

you might found this interesting

Becoming a consistently profitable trader seems to defy the traditional rules of achieving success. You know the drill - create a positive state of mind and energy each day. Then develop winning visualizations and affirmations - ready to engage your trading day with a success-imbued mind so that you can stay positive even in the midst of drawdowns. The result should be that, day after day, you are ready for the trading day. Nothing can stand in the way of this powerful positive success thinking. You have seen this formula work before. Your job is to keep it up until the changes occur.

This is where trading success and the rest of life seem to part ways. In trading, all that high positive energy stuff hits a wall. No matter how positive you are that success is on the horizon and within your grasp, the truth as revealed in your trading account tells a different story. The harder you try to create positive outcomes; the harder success seems to elude you. But why?

Self-Mastery and Conquering the World with Positive Energy Are Different

Trading requires a degree of self-mastery of the dark side of your human nature that prosperity thinking does not acknowledge in its focus on the positive. In trading, your demons come seeking you out - whether you are willing to acknowledge them or not. Those demons come in the form of your fears and your impulses (when exposed to uncertainty) that positive thinking cannot cover up. In Jungian Psychology this is called your Shadow. It's there in all human beings, and as long as you don't deal with it effectively - your Shadow nature comes stalking you just when you are most vulnerable...when the mind you bring to trading engages the all-too-real threat caused by the uncertainty of having capital at risk.

It is here that your Emotional Brain snaps into survival mode. And it sweeps all that positive stuff away like a tsunami. Instead of making things happen by sheer positive will, the primitive fears that are part of man's quest for survival have to be dealt with. This is a time for emotional state management. It is a time for discipline to see through to self-mastery. It is time for courage to stand in the face of danger. It is time to calm the power of fear that can sweep your mind away. And it is time for clear thinking about how to minimize losses - because they will come - and how to let profits run when the trading gods favor you. Notice positive thinking is not part of the trading mind. But a positive faith in your edge over time is required. It is a mind that accepts both the positive and the negative as simply parts of a greater whole. And as you learn to act from your faith in your probability edge, you discover there is no need for either fear or over-confidence. The trader's mind is not trying to make things happen. Rather it is patient and waits to see what the markets will give.

Mastering Your Primal Fears is Simply Part of the Trader's Journey

The moment that your trust and your faith (humble confidence) in your edge is shaken, short term survival instincts of the emotional brain kick in. This is where trading psychology plays a huge role. Until you can master the emotions of fear and aggression, you cannot have tested faith in your edge. You cannot trust your performances to deliver your edge. The point here is that the edge is both in your systems and in the mind you bring into the moment of performance. That is what you can control. Until you master your trader psychology, there is no sustainable edge in which you can have faith, trust, and confidence.
arbitrage16
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trader44 wrote:
Wed May 01, 2019 5:25 pm


you might found this interesting
Interesting post, who wrote this? Chimes a lot with Rande Howell's ideas.

Frustration I have with this is that it nicely outlines the what, identifying the issue, but not the how of a solution.
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cmuddle
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Thanks a lot to everyone who contributed.

ShaunWhite I hope you are ok.
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