Improve your trading-and how?

Gents,

I heard being asked:
what is it you are doing right and want to continue?
what is it you are doing wrong and want to avoid ?
what do you think you are missing to do, and must have started now to begin doing?
and improve trading?
how?

By avoiding doing all those wrong things(allow loss to grow big,not using stoploss,not trading both ways,long and short based on mkt direction)
and by starting to do all those right things.(use money management,risk control,stoploss etc)
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How to Improve Your Trading

-- by Bill Kraft

I gave a two-day basic seminar the last weekend in August and it was so well received that I thought it might be worth re-emphasizing the need for traders to expand their knowledge and pursue their trading education. Initially, I began the seminar business in self-defense.

I had become so excited about trading that I was inviting friends and neighbors to the house to teach them trading basics. Unfortunately, I overdid it and got to the place where I had people over five days a week sometimes for five or six hours a day. It got so that I couldn't do my own trading so I decided to give a seminar and charge attendees, thinking no one would come. I was wrong; they came and the business grew from one basic two-day seminar to four two-day seminars going from basics to technical analysis to trading spreads, splits, trading the lines and volatility trading.

Now I had a business that, although lucrative, was taking up more time than I wanted to spend. I cut back to the point where I only give a couple a year, but even that is more than I really want to do. Trading is my real passion and business and that is what I spend most of my time doing.

Having said all that,

I do want to emphasize that trading education is critically important. Far too many people trade without having a clue about how to do it. In my estimation, that is the quick route to losing money.

I remember not that long ago when most people traded on the basis of a broker's phone call. Sometimes it was a broker known to the trader and sometimes it was a cold call. Each time the broker called with a story about a stock. Inevitably the story dealt with the fundamentals of the company and a suggestion that the trader buy the stock.

In those days, I often bought the story and the stock and immediately placed an order to buy.

It seemed that I never got a call to sell. Sometimes, when the stock went down, I'd call the broker and ask whether he thought I should sell, but the answer always was something like:

"No, you need to buy and hold."

It wasn't until I began to educate myself about trading that I asked myself the question:

"Hold 'til when? Until I die?"

Overall, the results for me weren't much to write home about although I think the brokerages with the inordinately high commissions made out quite well.
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Looking at the scenario I just related, see all the mistakes I was making.
I had no plan,
I had no system to manage my money,
I took someone's word without doing even a cursory investigation,
I gave no thought as to the "when" of my entry, and
I failed to use a limit order in buying a stock.
I NEVER KNEW OPTIONS TRADING EXISTED
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Beyond that, option plays were never a consideration.

I barely knew they existed and didn't know the difference between a call and an aspirin let alone a put.

Truth was, commissions were so expensive, only the large trader could even think of option trading.

I suspect most people who invest or trade continue to make many of the same mistakes. Only through education and practice can each of us expect to improve our trading.

It is unlikely that the shoe salesman in the mall or the hair dresser will provide us with that "tip" which will result in enormous wealth.
We're much better off seeking out and listening to successful traders. Great books and DVDs exist to help the trader. Seminars abound. It's not that we lack opportunity to learn, it is that we fail to take advantage of those opportunities. There is always an excuse not to do it. "I just don't have time" tops the list.

Well, it is your money and you probably worked hard to earn it. Now do you want it to work hard for you or are you content to gamble it? If succeeding in trading is important to you, if bringing in extra income each month would improve your quality of life, I suggest that you make the time to learn.

An uninterrupted hour a week of studying trading and paper trading will put you way ahead of the crowd. That's 50 hours of education a year. Maybe that could help us to intelligently answer the question: "Hold 'til when?"
Good Trading!

excellent................

Hi! rvlv,

Keep them coming ... Your threads are invaluable.

Warm regards,
Amit

Thanks for the advice.It really enumerates in nutshell allthe boundries which we shoukd not cross if we want to be a successful trader.
Regards