It sounds obvious, but for so many, they do the complete opposite.....
Some may have heard the phrase 'keep it simple stupid', Kiss for short. Its a design principle which states that strategies and systems should be simple. Wherever possible, complexity should be avoided as simplicity guarantees the greatest levels of user acceptance and success.
So when trading, apply 'kiss', make money, get rich, THE END.
However, it is actually that simple. In fact there are many things in life that are simple. You just need to apply that simplicity. Many people struggle losing weight or building muscle. Eat properly, eat healthily, exercise, you will lose weight. Build muscle? Eat properly, eat plenty, eat some more, tare your muscles, rest, eat a bit more, repeat. Its all simple, but yet people struggle. They over complicate things. They add in things that are not required. That could be the odd muffin or latte, or they could over train and not take enough rest. Its strange how people often like to over complicate simple things, but most of us are guilty of.
When it comes to trading, I find the examples above fit true. Firstly, it should be kept simple. Think of it as weight loss. Intake your information wisely, from a good source, exercise that information correctly. Don't add in extras that are not required. In the same way, over trading can be as bad as over training. All it does is stumps the results and leaves you frustrated, angry and tired. Most importantly though, you do it to try and rush the process, and that's always a negative.
In most cases, my students cant wait to get behind the screen and to be trading a live account. They instantly want to make that first trade. Is that an opportunity? who cares, they need to trade......Personally, I've sat at the computer for days, trading, but placing no trades. Does that mean I haven't worked? Of course not. Does it make me indecisive? Of course not. About twelve years ago, a good trader told me that opportunities are endless, capital is not, and what a wise statement that is. Too often traders think they must be trading. If they are not in a trading position, then they need to be. But this is so far from the truth. I tell my students to line up their trades in the morning. Some are lengthy swing traders, so they may be in positions for several days or weeks. That's fine. Boring perhaps, but still, its fine. What they should not be doing is sitting bored looking for opportunities that don't exist.
So what happens when people get bored? Using our first analogy of the diet, bored people on diets eat......well some do, I have, I'm sure you have too. It ruins the diet and it does you no good, in fact it can be a major set back. The same applies to traders. They get bored, they look at the odd currency paid they rarely trade, they look at those volatile exotic currency pairs too and see a bit of excitement. Of course, they are good traders, so they carry out their analysis. They add some trend lines, an average, a moving average, it all looks good, justified, executed. And then that one so say exciting trade ruins a days or a weeks worth of gains......and what for. Why did they need to make that trade. Was there really nothing else to do, of course there was. Is it boredom? Is it greed? Maybe they wanted to look busy? Who knows?
My highest profit trades, those of my students, and those that ive helped on line, have always been the trade that came from little analysis, little planning, little desperation, and plenty of discipline and patience. One of these a week, or sometimes a month can make you a generous profit. Is it a guaranteed strategy to succeed? No, but the odds are better than that of over trading just for the sheer hell of it.
Keep it simple stupid x
#kiss #trader #mentor #overtrading #discipline #trading #forex #crypto