Thursday, 10 February 2011

My New Patient, Simple Trading Goal

As part of my drive to become a profitable speculator in the sports markets I have been evaluating where I think I have been going wrong when trading.  I have now drawn up a list of reasons for my lack of progress in this area, I am not saying this is a conclusive list and I am not saying this complete list will apply to other traders, but I can state that this list captures the majority of drawbacks to my individual trading success:

1. Not practicing what I preach.
2. Over complicating the whole process.
3. Not trading in a methodical way.
4. Not using sound money management.
5. Taking profits too soon.
6. Letting losses run, hoping for a turn around.
7. Focusing too much on short term results.
8. Not recording and reviewing my trades in enough detail.

As you can see I have probably been committing every trading error in the book. I have spent numerous hours trading and reading about trading with the net result being a negative profit and loss statement. I must have read and discussed about all of the reasons on the list above many, many times but never really took the actions necessary to stamp them out. Well as part of my new patient approach I have drawn up a new list of rules that I am going to stick to rigidly.

1. Simplify my trading process.
2. Study the skills involved in becoming consistent trader.
3.  Trade in a methodical way.
4.  Use sound money management.
5.  Only trade where the upside is significantly higher than the downside.
6.  Concentrate on my method and discipline instead of my short term results.
7.  Record and review my trades in as much detail as possible.

Over the coming weeks I will write a series of posts explaining the above points in more detail. When the time is right I will start trading again and discuss how I am progressing with regards to each and every point. I will post up my profit and loss figures but on a minimum of a monthly basis.
I believe that even though this YouTube video is directed at trading the financial markets, it captures the essence of what I am going to try to achieve.                                                   (All of the players in the band a extremely successful financial traders. The lead singers name is Ed Seykota who is regarded as one of the best financial traders of all time.)

I hope you enjoyed this post
Stay Patient


  1. Hi good luck with the blog . My comments revolve around NO. 6 on the first list. I`ve been trading for over a year now - regularly make $2-3 per race using $ 20 - $40 units and the biggest thing to overcome is your own belief that the market will come round to your way of thinking! This is more the mindset of the punter thinking his selection will win and if you`ve come from a punting background it`s a hard one to get your head around. Always be thinking ` the market is always right - ALWAYS !`.The crowd will always beat the individual.
    My method is back or lay / put in stop loss / concentrate.
    It takes out ALL emotion immediately.
    Cheers , JT

  2. Hi JT

    Thanks for the feed back, it is exactly the kind of advice I am looking for. You have laid it out pure and simple.

    "Back or lay / Put in stop loss / concentrate"

    When you write it down like that it looks so simple but it is having the discipline to stick to the plan rigidly that has been the hard bit for me. I think having confidence in your method for selecting trades is part of the key to not second guessing decisions that you make.

    Thanks again for your input


  3. Just to reply , how you choose your entry point is up to the individual - i look for bottoming /topping out / little bit of level trading then the turn, however , i put in a very tight stop loss of only 2 or 3 ticks , if the market continues against you because you`ve called it wrongly, your`re out ` before ` you have time to second guess.When the market goes in your favour getting back 2 or 3 ticks can be done easily - you`ve watched many a price shoot out 5/6 ticks in a split second i`m sure.Exits can be trickier sometimes ( taking profit too soon ) as there can be a temptation to get out at the sight of any green at all! My method is - when i`m up the profit i`m aiming for , i put my stop loss in at that point and hope the market continues to ride in my direction as the stop loss follows the price - if not , it doesn`t matter because when it turns you`re already in the front of the queue.
    It`s a numbers game , nothing to do with form/reputation/whatever in my opinion.Be on the look out for any 2 of the first 3 in the betting going in the same direction - the 3rd horse must go in the opposite..... 100% book give or take a couple of %. JT

  4. Hi JT

    Thanks for going into more detail I really do find it helpful.

    One last question: you put "concentrate" as the last part of your method. How long do you stay at the screen for and still are able to concentrate.

    The reason I ask is because sometimes I have been very alert when I start trading but I can on occasions, without realising it, start to loose concentration. I supposed my question is how do you maintain concentration for long periods of trading or do you only trade for short spells?

    Thanks again

  5. Hi , it`s about staying `in the zone` to use popular parlance for short lengths of time . You can learn to concentrate for short bursts - 5/10 minutes say ... ie until you``ve achieved your goal .... then relax , so to speak and re engage in the next market.I`ve a youngish family and give myself periods of time with the door to my study shut , could be just an hour one day/evening but maybe 3 or 4 hours per day at weekends.I believe health and safety regulations suggest for every hour in front of a screen you should take 15 mins break ?
    Cheers , JT

  6. Hi JT

    Thanks for getting back to me again. I will now take my time to digest all of the info.

    Thanks again.



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