Trading Psychology - Becoming A Better Trader
-
Having been a hit and miss trader for a couple of years I’ve slowly started realising that for me the biggest part of being a successful trader is having the right mind set.
A daily cycle for me for a long time has been to either win my planned trades and then jump on a couple more unplanned ones through nothing but impulse and scratch out the previous wins or a planned trade goes against me and I lose control and end up in the red.
This has been a constant repetitive cycle which I have tried countless times to break by promising myself I won’t do it again! Ultimately this never works as I’m not actually assessing the individual components that lead to this problem, so over the last few weeks I’ve decided to analyse every aspect of my trading and create a structured plan that covers every aspect of my mindset so I can improve.
This blog is intended to diarise my thoughts, give myself focus to keep on track and also hold myself accountable to anyone who reads it.
I’m sure there are many people who suffer with impulse trading, chasing loses, not fully researching trades, FOMO and countless other mindset aspects of trading so if this can help anyone along the way it will be worth me confessing all the negative areas of not only my trading but my personality.
I will update this blog everyday with my thoughts on improving mindset, what I’m implementing at the time as well as my progress and also some previous horror stories!
-
@tom-david once you start showing these trades others like me and other pro traders might be able to help. On the other hand if its a good strategy then you can then help others and pros can help you manage it. There has only been 3 full days of trading in July, very little football has been played. Your up 13pts already in 3 days, straight away it makes me want to ask what's your staking like and how many trades are you involved with. While this blog is great for how your managing mindset seeing your trades along with your running points totals would be refreshing and helpful for readers. It might resonate more if people say who are struggling see this and go wait he is doing something different and doing well, maybe ill try this. They can then see your sheet and can then link what your saying in the blog to actual trades, made a huge difference when i did it with mine, not only for me bud others. Perhaps linking your spreadsheet onto here?
-
@darri I have been thinking about it a lot recently mate and it seems the next logical step for me but I am not quite ready yet
-
@tom-david 13 points in 3 days is good going mate, have you thought about sharing your trades, if its becoming consistent it would be decent to see them more transparently
-
@tom-david I would say for sure that is a good sign. If you think its odd to jump into a trade you are probably thinking exactly the way you should be for that long term success.
-
Thanks lad, it’s starting to feel weird that I ever jumped into trades the way I used to which has to be a good sign. Focussing on the long term benefits of trading is the main aim for me at the moment
-
Well done mate. Keep it up
-
I’ve been quiet on here recently but that’s mainly because things have been going well so not much to report. I am sticking to my trading plan and filling in my spreadsheet daily and seeing steady growth again.
I’ve stopped watching any trades and am simply making my selections in the morning, placing them and then in most cases not looking back again until the following morning.
Repeating to myself every morning before I place my selections
Am I confident in this trade
Am I confident in this trade
Am I confident in this trade
Am I confident in this trade
Am I confident in this tradeI’ve also attached a daily compounding projection to my spreadsheet which gives me an extra motivation to stick to my plan and protect my profits.
I’ve not traded any of the euro games since the group stages and have stuck to laying under 1.5 goals and the occasional LCS.
Ended June with around 20 points profit, most of this was made in the first two weeks, the second half of the month was mostly just up and down.
July so far I am up 13 points so hoping this continues and doesn’t follow same path as previous month…..
-
@dan-mackinnon now that is a cracker!
-
@ryan I heard Josh Homme say something similiar about anger - "It's good to have it in the car, but you don't want it behind the wheel!"
-
@tom-david It's a never ending battle, in the book Big Magic by Elizabeth Gilbert - Not about trading more life but here she says that fear is the same everyday and its boring, you'll never get rid of it, it's like going on a car journey it gets in the car but it doesn't decide the direction you go in or what's on the radio.
I think that's a beautiful way of looking at trading too, your demons will always be there - We cannot hide them, but we can decide the direction we go in, there's no set rules either - work with what works for you. be sensible protect the bank, scale at your own pace.
-
Had a much better couple of days since adding the additional elements to the spreadsheet, 89% strike rate and a 5.58% increase of bank, seeing these figures daily again has given me back the will you protect the bank at all costs!
I think I’ve learnt that I’ll never be free of my demons no matter how comfortable I feel so I will always need these additional filters to keep me in check!
Learned a lot from this community so feel really grateful for that, felt at ease to leave the trades alone yesterday as well and just let them be, getting involved in watching them isn’t good for me so that’s my goal for next few months!
-
@simji don't apologise for rambling mate, I'm really glad you've replied as you sound just like me! You keep going round in circles because you can see that there is money to be earned in this but you slip out of the self discipline that is allowing your bank to build. It's short sighted greediness instinctively kicking in, we are programmed to look for instant gratification so a few things go right and we jump into something else without thinking or try to increase stakes too early.
The biggest problem with increasing stakes is as soon as we become uncomfortable with the money at risk we behave differently so you are far more likely to lose it.
The simple fact is we need to consider this long term, imagine you are starting today and tell yourself repeatedly that you will not see any financial gain for 12 months and focus entirely on building you bank and slowly increasing your stakes.
I have decided not to increase my stakes until my bank balance has doubled but I am doing this out of self discipline only, to push myself to see if I can stick to my word.
A sensible staking plan would be to increase your stakes every time you add 50% to your bank balance. If you make projections including these increases to your stake and have a clear sight of where you are going and how you are going to get there it should add another filter to stop you making those mistakes.
Stick at it mate and we will get there!!!
-
@tom-david said in Trading Psychology - Becoming A Better Trader:
Having been a hit and miss trader for a couple of years I’ve slowly started realising that for me the biggest part of being a successful trader is having the right mind set.
A daily cycle for me for a long time has been to either win my planned trades and then jump on a couple more unplanned ones through nothing but impulse and scratch out the previous wins or a planned trade goes against me and I lose control and end up in the red.
This has been a constant repetitive cycle which I have tried countless times to break by promising myself I won’t do it again! Ultimately this never works as I’m not actually assessing the individual components that lead to this problem, so over the last few weeks I’ve decided to analyse every aspect of my trading and create a structured plan that covers every aspect of my mindset so I can improve.
This blog is intended to diarise my thoughts, give myself focus to keep on track and also hold myself accountable to anyone who reads it.
I’m sure there are many people who suffer with impulse trading, chasing loses, not fully researching trades, FOMO and countless other mindset aspects of trading so if this can help anyone along the way it will be worth me confessing all the negative areas of not only my trading but my personality.
I will update this blog everyday with my thoughts on improving mindset, what I’m implementing at the time as well as my progress and also some previous horror stories!
This sums up perfectly to what is happening in my trading at present and the same over the last few years. And it all comes from me losing that intial bank. I should stop thinking what i have done and improve but i find myself still chasing still from a couple of years ago to be in the same position as i was then.
-
@tom-david said in Trading Psychology - Becoming A Better Trader:
Just a little side note to this I've played around with some strike rates
Mine sits at about 88% for laying under 1.5 goals
I average 4 trades a day (this was quite interesting to find out as I expected it to be less, I guess we always look at the less, rather than the more, something I find I do in business too, always recognising a bad day but hardly ever a good!)
Anyway.......
4 x 365 = 1,460 Trades
I stake maximum liability as 4.5 so lets assume all 12% of losing trades are the maximum, they definitely are not, I'd guess at least 40% are matched at 3.
1460 - 12% = 175.2 losing trades
1284.8 trades x 0.98 = 1259.10 potenital points profit
175.2 x 4.5 = 788.40 points loss
1259.10 - 788.40 = 470.7 net points profit per year
£2 stakes = £941.40
£5 stakes = £2353.50
£10 stakes = £4,707
£20 stakes = £9,414
£50 stakes = £23,535
£100 stakes = £47,070Writing these figures down shocks me to see that my profit each year is far less than this, so I am going to include these figures on the top of my spreadsheet as a daily reminder that I should concentrate on this single strategy, everything else I do, however it feels at the time is only harming this for me.
Hope someone else finds some value in this, sure it's simple stuff but the simple things done right have the most impact.
@ryan said in Trading Psychology - Becoming A Better Trader:
Great way to look at it, nearly £50k in tax free money is not to be sniffed at, look at what you’d need to earn to net that as taxable.
this is something i have been trying to do recently and keep thinking only £5 or £10 profit a day is 1825 or 3650 a year is a good amount but i do find myself chasing losses still and i know where my downfall is and i know the mistakes i make. I have blown through enough banks over the last few years and when i say banks i mean i can deposit £20 a time or £50 a time and i can grow the bank but to lose it. Mindset is my biggest issue. I can do well for a few week or even a months but then seem to go to old habits after a big loss or a few unexpected ones.
i have thought to myself why to keep going at it when i keep making the same mistake over and over? But i know i can do it and i know i can make it work as ive seen my bank grow quite a few times. I defo see short term rather than long mostly. As i do at times think of it could have been this much in the bank rather than saying okay its a bad day or a couple of losses and new day tomorrow.
i find i take way more risks in trading than i do in other aspects of life.
sorry for the ramble
-
That’s a good way to look at it. Broke down like that gives you something to base it on.
-
Just a little side note to this I've played around with some strike rates
Mine sits at about 88% for laying under 1.5 goals
I average 4 trades a day (this was quite interesting to find out as I expected it to be less, I guess we always look at the less, rather than the more, something I find I do in business too, always recognising a bad day but hardly ever a good!)
Anyway.......
4 x 365 = 1,460 Trades
I stake maximum liability as 4.5 so lets assume all 12% of losing trades are the maximum, they definitely are not, I'd guess at least 40% are matched at 3.
1460 - 12% = 175.2 losing trades
1284.8 trades x 0.98 = 1259.10 potenital points profit
175.2 x 4.5 = 788.40 points loss
1259.10 - 788.40 = 470.7 net points profit per year
£2 stakes = £941.40
£5 stakes = £2353.50
£10 stakes = £4,707
£20 stakes = £9,414
£50 stakes = £23,535
£100 stakes = £47,070Writing these figures down shocks me to see that my profit each year is far less than this, so I am going to include these figures on the top of my spreadsheet as a daily reminder that I should concentrate on this single strategy, everything else I do, however it feels at the time is only harming this for me.
Hope someone else finds some value in this, sure it's simple stuff but the simple things done right have the most impact.
