Opinions Are Worthless...
3 Responses to “Opinions Are Worthless”
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Panic Is Not A Strategy For Success...
3 Responses to “Panic Is Not A Strategy For Success”
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Tony Monk says:
A couple of years ago I was getting into trades feeling what you described, but than I decided that I would get to the root of the problem and educate myself to eliminate such fear and emotions. I started listening to Dr Wayne dyer, Dr Deepak chopra, I also read a great book called (the power of the subconscious mind) by Dr Joseph Murphy, and I have been on this path since than, and for me it has helped me get to know myself and has helped me realize that everything as we know it is nothing more than just learning experiences to get to our next level in life, and from these experiences we learn to try not to repeat the same mistakes. I learned from the book (The power of the subconscious mind) The sub mind is habitual, and that we need to replace it with good habits and once we repeat these good new habits, than they become the new norm.
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Good advice.I wrote on this subject almost exactly a year ago adding that the need for security enters into the mix and may be the underlying driver of the fear. It may be of interest to you and your readers. http://daytradingwithanni.blogspot.com/2009/01/fear-and-greed-or-is-it.html
And thanks for the Twitter visit. -
Dave says:
I think we all went through those trading phases when learning the ropes.
I for one dropped my fear and greed when I set a plan for what I wanted from the markets. That is, I decided that I wanted a specific profit target and no longer needed to swing for fences or squeeze every nickel from every trade.
With stops and profit targets adjusted to the current market, how much I would “take home” or “pay” was now simply a factor of position sizing. If I need more cashflow; I up the capital balance and thus the position sizes I take on.
Thus, my risk remains the same and my target remains the same relative to te market.
Don’t have the extra capital? Just plug away with what you have because at a 5-10% average per day return it doesn’t take long to accumulate a balance that could accommodate anyone’s income requirement.
Now I trade a “set it and forget it” strategy. Once the trade is in, I shut off the computer and go do something else for fun or profit.
It’s much easier that way because I know the outcome(s) in advance.
Your option strategies are very similar in that respect and I use them exclusively for my equity trades.
So, I control fear and greed by establishing pre-determined outcomes, set the trade, then go have fun at something else while the market moves the way only it can predict.
Once in a trade, risk is the only thing I can really control. Controlling risk and accepting set profit targets leaves no place for fear nor greed to take hold.
Dave
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Using Positive Nervousness To Get Result...
One Response to “Using Positive Nervousness To Get Results”
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Patricia L. says:
Great article – This nervousness you described in your article is known as eustress, which literally means “good stress”. By definition, this is the type of “positive” stress that keeps us vital and excited about life. I learned about this during my training to be a ED/Trauma Nurse and learned to utilize this stress to provide the best outcomes for my patients. I am now working at utilizing eustress to become a successful trader.
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The Road To The Top...
5 Responses to “The Road To The Top”
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Brent says:
“Law of Practice” it seems so simple yet so creative!. I have put 10,000 to paper and will take action on it.
Thanks for sharing this Jeff!
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Hey Brent,
Glad you’re part of the Credit Spread Trading Made Simple Tribe! It’s just a matter of time before you become the All-Star of the Month.
JZ
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robert says:
matt furey has the secret which is really no secret at all. which is when you truly want something you will find a way to get it done. matt’s bodyweight exercise system is as basic as they come but will deliver the most results if applied correctly. matt was the reason i found j.z. and credit spreads. if matt’s wife who speaks english as a second language could grasp this and become successful i knew i could as well. it turns out i was correct. i was typical of that 90% of people who started off great guns and then quit after awhile when success does not come immdediatley. after about 6 months of no credit spread study or exercise i have resumed both and of course the results are much more positive and i am back in the zone. it’s really just that easy.
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Eric says:
Jeff,
Nice post! A wise man once told me that most “overnight successes” actually take 10 years. It’s nice to know that 10,000 hours works out to only 4.8 years assuming 40 hours per week. That’s not so bad.
-Eric
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Laurie says:
Hi Jeff,
I first read about this idea of 10,000 hours to mastery in Michael Masterson’s Early to Rise newsletter. In that article he mentioned that a person could cut that number down significantly (I don’t remember exactly by how much) by modeling someone who had already achieved mastery of your goal or by being coached by someone who had already achieved mastery. So. . . thanks for all the great coaching and inspiration for those of us who want to learn to be great credit spread traders. Regards, Laurie L.
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The Focus of the ‘Transformed̵...
8 Responses to “The Focus of the ‘Transformed’”
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Dave L says:
I think its the difference between those who pursue trading as a profession vs those who are looking for easy money. That said, I can understand why someone new would ask how much they can make and how long it’ll take. Almost all young people ask that, and rightfully so, as they go into college and look to their future. Once someone approaches trading as a profession, vs some quick money lottery scheme, the odds of them being successful go up dramatically. The next hard question? What >kind< of trader does he want to be?…………
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Dharmesh Shah says:
Hi Jeff,
I couldn’t have agreed with you more. This is exactly what happens with every trader. It also had happened to me. I used to focus lot on the end results of profit and loss. I have chnaged my thinking a lot after I watched your video regarding learning from past trades. I went back and jogged down all the trades and then started learning from each trade. Because of this, I have become more disciplined in my trading. Today, I focus only on two things, Why am I taking a particular trade and what is my trading plan for that particular trade. This renewed focus has provided a great sense of relief since I don’t change my plan but I learned from past trades and become a better trader that can handle any situation.
Thanks for your post..
Dharmesh Shah
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Cliff says:
Thanks, Jeff.
This is exactly what I needed to hear right now… as well as a few months ago. I started off with a bang and wildly successful, both paper trading and real and at one point thought I might have been close to winning the Apple TV.
In June-09, I was put in a situation where I had to begin focusing on $’s results vs % results because I needed monthly income from this. Unfortunately, I let the plan and the technical aspects of trading become secondary. Yes, this does lead to “gut” trading, more risky trades, trading from the hip, losses, not managing account risk properly, trading with my ears not my eyes, etc… and ultimately confusion and frustration. (Kind of feel like I’m in an AA group right now… lol)
I became approaching trades in an “afraid to lose” mindset and decided to “quit” for a few months to “reset” my head and newly acquired habits. If I didn’t change something and quickly, I would not be able to do what I’d always wanted to do for long.
I went back to paper trading account after “the quit” and have only done a few trades in live. I want to make sure that when I go back in, full guns, I’m thinking like the Transformed.
It is my undying goal to Trade full time, just no longer pressing myself for it to happen “tomorrow”. Patience, diligent training and God’s plan for me… are my new mindset.
Hope this helps someone. And Jeff, certainly correct me on any of my thinking here that you feel should be different…
Have a good day, All.
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Jeffrey Ziegler says:
Hey Darmesh,
Good to see you here on the blog. Isn’t it amazing how that one simple act of the writing things down in a trading journal helps clear the mind? Every time I shoot from the hip I get burned. But when I focus on trading well, and planning out in detail what I’m going to do…Amazing Difference!
Are you using the trading journal worksheets that I put in the membership site?
JZ
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Cliff…You are on the right path. Thank you for taking a moment out of your busy day to post this. I guarantee someone will benefit big time. Are you using the trading journal worksheets in the membership site?
JZ
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Jeff,
This reminds me of the folks who trade without a plan or any idea about managing risks.
It’s been said that once a trade is placed, the only thing you can control is when you you get out. You can’t control the prices or their direction, you can’t take a “do over” on the entry.
You can only manage your Take Profits and Stop Loss strategies.So, like the baseball player who can only control the fundamentals of executing his swing, the trader can only control the fundamentals of executing their trade strategy.
Once at the plate, or at the computer screen, both have to rely on their training and practice to execute their game with precision. The batter hits the ball, the trader takes the trade, yet, neither can be certain of the outcome of any particular “at bat”.
The fly ball could get caught, the great trade setup could turn south.
But like the player and his stats, the trader who trains and executes with precision will eventually earn the highest “batting average” and salary.
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As author of “Awaken Your Speculator Mind,” it’s refreshing to see someone else believing the importance of trader mindset. Let me add, though, that trader transformation is also an ongoing process, not a final destination. – Good article!
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Craig Freeborn says:
When I stopped aiming for Home runs (big killings using directional trades) and started focusing on base hits (smaller but steady credit spreads where I don’t have to be 100% correct on direction and timing) I stopped losing money and started making steady income every month. Thanks Jeff.
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Good morning Jeff. One of the first things I learned from you and will never forget is” trade what you see.” Sounds obvious right? What did Buffet say,” Forecasting says alot about the forecaster and nothing about the future.” It makes me sick to my stomach when I hear BS about the economy or certain stocks from people with personal agenda’s. It doesn’t matter to me which way it goes as long as it goes!
Jeffrey:
Thank you for posting this. I agree totally. Not only are we being bombarded with opinion, even those who express the opinions have some sort of interest in pushing their views. One commentator might be shorting the market and therefore will predict a slow down in an attempt to influence a sell-off; those who are long may do the opposite.
I am not going to offer an opinion on the market to anyone. One attorney told me once: “There are two kinds of advice: advice that you pay for and advice that is not worth a d__n!” How true. Just consider that when you read the WSJ or watch CNBC, that you are getting FREE advice and it is worth exactly what you paid for it.
None !! I only listen to my master mind group, who happens to be you Jeff, and Peter shultz who has 30 years experience in trading spreads and options in general. You both are my mentors and master mind group, and both of you are the only ones that I am going to take advice and learn from, thank you.