Trade to Win - Proven Strategies to Make Money

c18 JWBT016-Busby September 30, 2008 15:3 Printer: TBD

180 THE WILD CARDS

other educational centers, the skills of trading are taught to students from

beginners to advanced traders. There is no substitute for knowledge.

The learning process can begin at home. One of the best ways to gain

knowledge is to analyze yourself and your trades. I believe that most of us

learn far more from our mistakes than we do from our successes. There-

fore, it is important to study each and every trade. I recommend that at the

end of each day you evaluate both your good and bad trades. Get a journal

and begin the process. After the markets close, find a quiet spot and write

down each trade that was made. Then think about it in detail. If the trade

was a winner, why did it succeed? If money was lost, why was it lost? At

what time was the trade made? What did the market look like at that time?

Consider the indicators, the key numbers, the manner of execution. In con-

sidering the winners, how could more money have been made? When pon-

dering the losers, what mistakes were made and what action could have

been taken to get a better result? Did you follow your rules? Exhibit disci-

pline? Use good money management skills?

PEARL 30

Learn how to win from your losing trades.

After identifying your strengths and weaknesses, make a plan for the

next day. What can be done to improve tomorrow’s trading? Then put that

knowledge into practice. Even though you scrutinize all aspects of your

trading on a regular basis, I suggest that your rules not be changed until

Saturday. The rationale behind this recommendation is that traders who

continuously change the rules are undisciplined and losers. In the quiet of

the weekend, consider the rules and why you use them. Do they work or

not? If not, why not? Are you, in fact, employing them consistently and

properly? If you determine that you need to alter some of your trading

rules, set out in writing exactly what is being changed and why. Then try

the new rules for a week and evaluate them. Did they improve your trading?

If so—great! If not, time for more evaluation and consideration.

PEARL 31

Change your trading rules only on Saturday.

Review

Trading involves far more than analyzing numbers and studying charts.

There is more to do than read an indicator or check a clock. All of these