Strategies To Remove Barriers
February 28, 2007 by Trader Rich
There is a new Investopedia article on removing barriers that may be affecting your successfulness as a trader. Here's my personal evaluation in regards to each:
- Learn to monitor your performance - I think I do a pretty good job at monitoring my performance right here on this website.
- Measure your behavior then identify what needs changing - Unfortunately, I don't think I do enough of a "deep dive" evaluating each individual trade that occurred in the past. I need to start doing this.
- Stay focused on what you need to change - I'm always doing this and always attentive to this fact.
- Identify how you will deal with losses - It's not always the easiest to deal with a loss but I'm getting better and better each month.
- Become an expert at one investing strategy - I get sidetracked from time to time but I think I'm accomplishing this by focusing my attention on short-term trading the GBP/USD.
- Learn to think in probabilities - I don't think I properly address this point. I think a lot of this involves looking at fundamental factors which I don't do.
- Learn to be objective - I think I remain pretty objective. I don't feel bound to any particular trading direction, long or short. If my system says long, I go long. If it says short, I go short. I'm like a robot when trading my system.
To read the entire article, visit Removing The Barriers To Successful Investing.
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Hi Rich,
I am just getting into my preliminary research on the forex market. I spent several hours today perusing your blog and think you are doing an invaluable service for individual traders. Separating the wheat from the chaff, if you will. This is off subject for this post, but in following your threads about how your primary trading service changes the spread mid-stream on profitable open positions, it raises a red flag for me. For someone who is used to the equity market, I do not understand why that is an acceptable practice. Surely, as the conduit for facilitating your trades, they are due a service fee. But how is it acceptable business practice for them to change the bottom line once a trade has begun? Is this a margin trading issue?
When using a trading system, either manually or automatically, there is absolutely no reason to introduce any aspect of personal psychological performance into trading so long as the system you are using has a proven track record. On the other hand, if one is trading ad-hoc, where fear and greed are the only rules, then be prepared to turn yourself inside out, upside down and back-to-front but take note: you will not like what this is may reveal. So be totally cold hearted towards trading currencies and when it comes to losses …. expect and forget … and remember: Using a system is the first step in disciplined trading.
A visitor to the site, David had an opinion on the broker practice of changing spreads in mid-stream. I’m pasting it here because it makes sense:
Another thing I’d like to address is that when you talk about the spread being poor during news releases I think it might be misleading. This is my take on it: because the FX market is opened 24/7 the majors don’t experience what is common in Futures and Stocks which is gapping. Say overnight Microsoft Vista was hit with a major virus or a major coffee producing country had a major eatrhquake or hurricane or other smilar event the price would probably open at a significantly different price than when it closeed. All limit and stop/loss orders placed in that gap would automatically be filled at the open price when the Stock Market and Futures market opened. The poor spreads during news releases isn’t soley based on an an abitrary descision by Oanda to increase their profits by raising the spread, its just a reflection of the volitility that comes during 15 or so minutes following the release. Like gaps in Futures or Equities between market open and close. Remember many other platforms will requote if you try to enter at Market during a news release.
Blackday, thanks for your helpful comments. As always, it’s nice to hear from you from time to time…
I agree, other brokers claim not to widen up spreads but they won’t let you trade and requote you. I tried it with an FXCM no dealing desk account but same story, during news releases, you are not able to get in. Always get the “price moved” box. SO, I still guess Oanda is best choice.
Tried the 30 pip stop/30 limit strategy for the 1 hour gbp but failed, lost 30 on that but made 90 pips on the down movement, so not a bad day.
Wiper