I'm not sure what it is about trading and the financial markets that people think, "Oh, I'll just quit my job, and trade for a living." It's like, "What? I'll just quit my job and become a brain surgeon." No you won't because you'll kill a few people while you're...
The tenth commandment of profitable trading is the most interesting. Most people look for the holy grail. What is the best strategy, the best set of rules, the best stock to buy, and the best that will make people rich. However, that search is a fool's errand because...
The ninth commandment of profitable trading is to eliminate mistakes. The trouble is most people don't know they're making mistakes. I wrote a document and it's got 97 common trading mistakes people have called the Trading Mistakes Cheat Sheet. As you are doing your...
The eighth commandment of profitable trading is diversifying in multiple ways. Most people think they're diversified just because they have five bucks, but no, they're not at all. Nowhere near it. You'd want to have different strategies, markets, and time frames. In...
The seventh commandment of profitable trading is to write your plan. You wouldn't go headlong into a business without any plan at all. You would have to have a business plan about what you would do, how you would make money, what your processes would be, and what your...
The sixth commandment of profitable trading is to reduce your risk. If you think you should be risking this much, you probably should be risking that much. The ideal amount to risk on a trade is usually far less than you think because unforeseen events happen. Crazy...
The biggest mistake people make is they think about making money. That sounds counterintuitive, but if you think about how much money you will make as opposed to how much you could lose if you are wrong, you get two very different outcomes. If you start by thinking...
The fourth commandment of profitable trading is you've got to have a positive edge or a positive expectancy in trading. If you apply your strategy repeatedly, do you get a positive expectation of making a profit? And I want to know if I test my strategy over the last...
The third commandment of profitable trading is to use an approach that suits you. If you're a very patient, long-term considered person, you want a long-term strategy. A long-term strategy is a trading strategy where you buy and you wait through the big major trend,...
The second commandment of profitable trading is to use a system. Most people approach the markets the way they approach everything else. They think “I'm pretty smart. I've got some experience. I'll bring that experience to bear, and I'll make some sensible decisions,...