Steps to Successful Commodities Futures Trading as published in Commodity Futures Trading Club News and in Traders Organization's Real Success Daytrading Course:
1. We accumulate trading information - buying books, going to seminars and researching.
2. We begin to trade with our 'new' knowledge.
3. We consistently 'donate' and then realize we may need more knowledge or information.
4. We accumulate more information.
5. We switch the commodities we are currently following.
6. We go back into the market and trade with our 'updated' knowledge.
7. We get 'beat up' again and begin to lose some of our confidence. Fear starts setting in.
8. We start to listen to 'outside news' & other traders.
9. We go back into the market and continue to donate.
10. We switch commodities again.
11. We search for more trading information.
12. We go back into the market and continue to donate.
13. We get 'overconfident' & market humbles us.
14. We start to understand that trading success fully is going to take more time and more knowledge then we anticipated.
Many Traders Will Give up at this Point as they Realize Work is Involved
15. We get serious and start concentrating on learning a 'real' methodology.
16. We trade our methodology with some success, but realize that something is missing.
17. We begin to understand the need for having rules to apply our methodology.
18. We take a sabbatical from trading to develop and research our trading rules.
19. We start trading again, this time with rules and find some success, but overall we still hesitate when it comes time to execute.
20. We add, subtract and modify rules as we see a need to be more proficient with our rules.
21. We go back into the market and continue to donate.
22. We start to take responsibility for our trading results as we understand that our success is in us, not the trade methodology.
This is where I was at on 01/21/2009
23. We continue to trade and become more proficient with our methodology and our rules.
24. As we trade we still have a tendency to violate our rules and our results are erratic.
25. We know we are close.
26. We go back and research our rules.
27. We build the confidence in our rules and go back into the market and trade.
28. Our trading results are getting better, but we are still hesitating in executing our rules.
29. We now see the importance of following our rules as we see the results of our trades when we don't follow them.
30. We begin to see that our lack of success is within us (a lack of discipline in following the rules because of some kind of fear) and we begin to work on knowing ourselves better.
I think this is where I am at the moment (03/19/2009)
31. We continue to trade and the market teaches us more and more about ourselves.
32. We master our methodology and trading rules.
33. We begin to consistently make money.
34. We get a little overconfident and the market humbles us.
35. We continue to learn our lessons.
36. We stop thinking and allow our rules to trade for us (trading becomes boring, but successful) and our trading account continues to grow as we increase our contract size.
37. We are making more money then we ever dreamed to be possible.
38. We go on with our lives and accomplish many of the goals we had always dreamed of.
This is an excellent list; thanks for posting. I am not sure where I am on the list but I definitely feel like I am making some progress. At least I'm not the only one going through this crazy cycle!
ReplyDeleteCheers,
Stan
You're definitely not alone!
ReplyDeleteAwesome list, thanks for posting !
ReplyDeleteI realize I am not really at a defined step in it ; there are steps I have "completed" or "met" like #24 mostly because of the enhanced volatility we saw this Fall.
However, there are other steps I lack, like steps talking about rules. I have rules and setups, but I am not sure if they are correct from a strict technical analysis point of view. But (thanks to my readings) I also know that you trade your beliefs, not pure technical patterns.
Bah, we'll see :)
Great outline. I'm stuck somewhere between the second and final stages, sometimes reverting back to the first, then to the second, then third, then back again.
ReplyDeleteI've donated so much trading is like my religion now lol.
What I think helped take me to the next level of insight is 1) pain, and 2) screen time. Trying to outlast the learning curve is the trick.
Great post, thanks for sharing.
Excellent list & great blog! Good luck!
ReplyDeleteEvery time I break my rules I loss... my losses are 90% when I do not follow my rules. It seems like there is an outside force involved as you would think that just out of shear odds that I'd win sometimes, however it is incredible how this works. When I follow my rules I'm successful.
ReplyDeleteWOW.. I thought it was just me. Thank you for posting this. I know I am at 22. My account has been at breakeven for 3 months due to a handfull of stupid trades that broke my rules. they cleaned out weeks of hard work.
ReplyDeleteExpensive learn.
Subhash,
ReplyDeleteA lot of people blow out their accounts in their first year so, breaking even while you're still learning is NOT bad at all. Keep it up and stick with your trading plan and rules!
Inspirational post emp. I'm not where i want to be in trading now but this post has given me hope that my time will come. Thanks.
ReplyDelete