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The problem of "INVERTED EXPECTATIONS" - The #1 reason for failure as a trader.
(A THREAD)
This is a very common problem that I& #39;ve seen with a lot of (wanna-be) traders.
(1/10)
(A THREAD)
This is a very common problem that I& #39;ve seen with a lot of (wanna-be) traders.
(1/10)
Most people enter the financial markets with absolutely wrong expectations, mostly misinformed & misguided by some market "guru" (there are tons of & #39;em !!).
As a result, the poor guy starts off calculating..
(2/10)
As a result, the poor guy starts off calculating..
(2/10)
-- "How much is my monthly requirement? "
-- "How much money do I need to make this much from the markets? "
-- "RandomGuru sir says its possible in (BLAH) rupees. I already have 2x(BLAH) in my savings bank."
-- "WOW! I am going to be SOOOO rich !!!! I am so excited! "
(3/10)
-- "How much money do I need to make this much from the markets? "
-- "RandomGuru sir says its possible in (BLAH) rupees. I already have 2x(BLAH) in my savings bank."
-- "WOW! I am going to be SOOOO rich !!!! I am so excited! "
(3/10)
Sooner rather than later, the market reality HITS the poor guy, depleting some or all of his financial & psychological capital.
Most traders who read this thread will relate to this hypothetical story in some way or the other.
So, I say --
"INVERT YOUR EXPECTATIONS"
(4/10)
Most traders who read this thread will relate to this hypothetical story in some way or the other.
So, I say --
"INVERT YOUR EXPECTATIONS"
(4/10)
-- Well, how do you "invert" your expectations?
Its simple.
Instead of focusing on how much "%return" can you earn, focus on...
(5/10)
Its simple.
Instead of focusing on how much "%return" can you earn, focus on...
(5/10)
-- WHEN & HOW do you wish to interact with the markets (a.k.a. TradePlan).
-- How much money do you want to risk (a.k.a. TradingCapital). Start off with an amount that you& #39;re OK to lose. Something close to what you typically spend on buying something like a mobile phone.
(6/10)
-- How much money do you want to risk (a.k.a. TradingCapital). Start off with an amount that you& #39;re OK to lose. Something close to what you typically spend on buying something like a mobile phone.
(6/10)
After this, you continually work on sticking to your TradePlan even when it is VERY HARD to do that (a.k.a TraderPsychology).
If you& #39;re observant enough, you will gradually (& continually throughout your career) keep realizing places where your trading plan needs amends.
(7/10)
If you& #39;re observant enough, you will gradually (& continually throughout your career) keep realizing places where your trading plan needs amends.
(7/10)
Do those amends, but be VERY VERY MINDFUL of over-doing this part as its a slippery slope!!
This brings us to the word "MINDFUL". I wont go into details of how you can do that. Google it and you& #39;ll see a ton of articles (Agreeably, most of them are utter bullshit !
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(8/10)
This brings us to the word "MINDFUL". I wont go into details of how you can do that. Google it and you& #39;ll see a ton of articles (Agreeably, most of them are utter bullshit !
(8/10)
But being more mindful is another journey that you& #39;ll have to embark on (just like becoming a trader). So let& #39;s not deviate from the main topic of this thread. I& #39;ll probably write another thread on that sometime.
(9/10)
(9/10)
So when do you actually get to calculating "HOW MUCH %Return can I make" ???
It& #39;s simple.
You get to that when you actually are able to make consistent returns, at least over a trade set of about 100-200 trades.
How long will that take?? Let time tell you that.
(10/10)
It& #39;s simple.
You get to that when you actually are able to make consistent returns, at least over a trade set of about 100-200 trades.
How long will that take?? Let time tell you that.
(10/10)
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