System hopping and different system every week. The BEGINNER rule seems to be "If you get three losing trades in a row, then your system is no good. Time to go find another one". This is so sad because so many traders fail to recognize two things :
A trader is not the Holy Grail.
Money management is not the Holy Grail.
A System, a Trader and Money Management together are required to create a Holy Grail.
There is not one Holy Grail. There are an infinite number of them. As many as there are combinations of System-Money Management-Trader.
Imho, the reason most traders fail is because they do not correctly identify where the real problem is and take steps to fix the real problem. From the paragraph above it should be clear that the problem is not with the system, but that's what everyone focuses on. When one system doesn't work, they try another, and then another, and another. Well of course changing systems isn't going to fix the problem.
"My car doesn't run. It must be the tires. Let’s try some Goodyear tires. Nope, still doesn't run. Lets try some firestone tires. Nope, still doesn’t run". A dozen tire brands later, the car owner has lost all his money switching tires and gives up on ever being able to drive. It never occurred to the owner to charge the battery. Tires are systems. The charge on the battery is the trader’s mindset, emotions, persistence and consistence.
You want step by step instruction on how to build your own personal Holy Grail ?
Ok..! here goes, combine the following:
Begin trading. After 20 trades, if you haven't made a profit. Then look at what is wrong with the trader and fix it. Leave the system, currency and micro lot per trade alone. THEY ARE NOT BROKEN, SO DON'T FIX THEM. After making adjustments to the trader, complete another 20 trades. Repeat this cycle until the trader is fixed. Once the trader is running properly, then and ONLY THEN may you try a different system or currency or position size.
It is not the system. It is you. Quit focusing on the system and do exactly what you've done here. Honest, painful self evaluation. And yes, go ahead, have a pity party, and make statements that you know perfectly well are false about trading. Do all this. Get it out of your system.
Just to give a bit of hope - Once I took a $5,000 account down to $50 in less than two weeks. 1:500 true leverage will do that to you. Despair, depression, defeat and a profound sense of total worthlessness, I was the poster child.
Then I went ONE-ONE-ONE as above and with great care and fifty tons of discipline, I grew that $50 back up to $500. By that time, I had regained my confidence. I had "fixed" myself by eliminating my problem of using high leverage.
If I can fix myself, anyone can. I still find broken parts of my trader self, and I identify them, I fix them. I don't muck with my system and I don't muck with my money management. I fix the problem where it lies. Inside me, the trader.
Possible profits and actual profits are separated by the great wall of trader psychology. Your job is to break down that wall.
Credit for James16Group
- The individual trades are meaningless. Only a long series of trades has meaning. It makes no difference whether an individual trade is a winner or a loser. When I place a trade, I don't care whether it is a winner or a loser. I don't care because every trade is a winner for me. If I win a trade, I make money. If I lose a trade, I learn from it. Either way I win, because I gain either money or experience.
- Traders fail to stay with one system long enough to allow its unique statistical edge to manifest neither itself, nor do they stay with one system long enough to know it inside out, forwards and backwards.
A trader is not the Holy Grail.
Money management is not the Holy Grail.
A System, a Trader and Money Management together are required to create a Holy Grail.
There is not one Holy Grail. There are an infinite number of them. As many as there are combinations of System-Money Management-Trader.
There are many good systems available for free. Pick one.
There are many good money management methods for free. Pick one.
There are many bad traders. Fix one, preferably yourself.
Imho, the reason most traders fail is because they do not correctly identify where the real problem is and take steps to fix the real problem. From the paragraph above it should be clear that the problem is not with the system, but that's what everyone focuses on. When one system doesn't work, they try another, and then another, and another. Well of course changing systems isn't going to fix the problem.
"My car doesn't run. It must be the tires. Let’s try some Goodyear tires. Nope, still doesn't run. Lets try some firestone tires. Nope, still doesn’t run". A dozen tire brands later, the car owner has lost all his money switching tires and gives up on ever being able to drive. It never occurred to the owner to charge the battery. Tires are systems. The charge on the battery is the trader’s mindset, emotions, persistence and consistence.
You want step by step instruction on how to build your own personal Holy Grail ?
Ok..! here goes, combine the following:
- ONE system.
- ONE currency.
- ONE micro lot per trade (live, NOT demo)
- ONE trader (that would be you)
Begin trading. After 20 trades, if you haven't made a profit. Then look at what is wrong with the trader and fix it. Leave the system, currency and micro lot per trade alone. THEY ARE NOT BROKEN, SO DON'T FIX THEM. After making adjustments to the trader, complete another 20 trades. Repeat this cycle until the trader is fixed. Once the trader is running properly, then and ONLY THEN may you try a different system or currency or position size.
It is not the system. It is you. Quit focusing on the system and do exactly what you've done here. Honest, painful self evaluation. And yes, go ahead, have a pity party, and make statements that you know perfectly well are false about trading. Do all this. Get it out of your system.
Just to give a bit of hope - Once I took a $5,000 account down to $50 in less than two weeks. 1:500 true leverage will do that to you. Despair, depression, defeat and a profound sense of total worthlessness, I was the poster child.
Then I went ONE-ONE-ONE as above and with great care and fifty tons of discipline, I grew that $50 back up to $500. By that time, I had regained my confidence. I had "fixed" myself by eliminating my problem of using high leverage.
If I can fix myself, anyone can. I still find broken parts of my trader self, and I identify them, I fix them. I don't muck with my system and I don't muck with my money management. I fix the problem where it lies. Inside me, the trader.
Possible profits and actual profits are separated by the great wall of trader psychology. Your job is to break down that wall.
Credit for James16Group