c16 JWBT016-Busby September 30, 2008 14:38 Printer: TBD
Beyond the Numbers 157manufacture trades and see trade setups everywhere. Every time a trade
is made, money is at risk. Therefore, it makes no sense to trade unless the
odds of success favor a win.
Over the years, I have seen many people who were very intelligent and
had most of the skills they needed to become really good traders. But they
lacked discipline. They made so many trades every day that they left my
head spinning. To gain discipline, establish some rules. Set aside specific
times during the day when you will trade. Outside of those times, close the
trading platform or at least walk away from the computer. In addition to
establishing some designated trading times throughout the day, also hold
yourself to some trading standards. Do not take just any trade. Use the
“T” Square approach and use good analysis. Be discriminating. After all,
it is your money that is on the line. Each day brings many possible trades.
Take only the good ones that are timely and supported by key numbers and
market indicators.Kiss Your Ego Goodbye
No one is perfect, and no trader always makes winning trades. Even
the pros lose money some of the time. However, when the pros are on
the losing side, they manage their money. That is, they admit defeat,
exit the trade, and move to the sidelines. The pros do not enjoy losing,
but they accept it gracefully. Egomaniacs do not manage their money be-
cause they stay with losers too long. They simply cannot admit that they are
wrong and liquidate the position. Losing money is painful but it is simply a
part of trading. Some trades are losers. In fact, some weeks and months are
losers. I encourage traders to put their losing trades in the proper perspec-
tive. As a trader, remember that any single trade is just one trade among
many. There will be dozens, hundreds, perhaps thousands of other trades.
If you preserve your capital, you can stay in the game for the long haul.
In that context, a losing trade is nothing to cry about. Learn from it and
move on.Be Persistent
Benjamin Franklin is credited with saying that energy and persistence con-
quer all things. Calvin Coolidge, the thirtieth president of the United States,
did not go that far, but he, too, believed that persistence was one of the
most important aspects of success. Coolidge said, “Nothing in the world
can take the place of Persistence. Talent will not; nothing is more common