It is helpful in general to be able to assess yourself within the long Journay of a trader.
The 5 stages of a trader that are:
1) The Novice. In this stage you try to lose as little money and time as possible till you learn what are the laws of the markets, and how a trading system should be.
2) The Advanced Beginner. At this stage you have designed, discovered or just learnt from other people, a winning system that you practice and make some money.
3) The Competent. At this stage not only you already possess a gaining trading system, but you gradually improve it so as to increase the return on investment and reduce the variance of the profits or improve other characteristic parameters that describe the system performance.
4). The Proficient. From this stage a big change occurs to you as a trader. You no longer try to improve the trading system. What you do is that you work, and play more with your subconscious attitudes, beliefs and emotions, relevant to the states of the market and the ability to practice the system as the anticipation and forecasting the markets.You trade for the joy and satisfaction of feeling in contact with the substratum psychology of social economic behaviour of the societies as it is proved by being able to anticipate it. You trade rather for the "return on energy" as Brian Tracy has put it, than for the "return on money". Or you explore how, the rather rare ability, to create safety and wealth from the conduction of your system, influences your subconscious and your psychological impact on other people (even if , and better so, you mention nothing of your successful trading). You also begin to plan and organize what to do with the surplus wealth that is created. And plan to fund some activities of interest to society and other people.
5) The Expert. This is a stage where one of your main concerns is your state of mind, and scientific or cognitive principles.E.g. teach others, or publish relevant scientific papers or books contributing to the science of economincs and the knowledge in general.At this stage also you may occupy yourself seriously in directing how the surplus wealth is re-distributed in scociety in the best way. E.g. through grants, scholarships, institutions, investments etc. As Aristotle was puting it , it is in the reach of every man to spend money and to the reach of many men to receive money; but few only have the virtues so as to qualify to decide to whom, why, when how much and in what way the money are given, so as to serve in the best way, the best purposes in society.
THE TOP 6 FACTORS OF ATTENTION IN MANUAL TRADING
1) NEVER USE ALL YOUR FUNDS FOR TRADING. DIVIDE THEM TO TRADING AND NON-TRADING FUNDS BY THE RATIO f=R/a^2 RULE (see below for this ratio or in posts 3,13,33). THE DIVISION OF FUNDS AT EACH PERIOD IS ADJUSTED TO CONFORM WITH THIS PERCENTAGE RATIO. NEVER WITHDRAW PER PERIOD FROM THE NON-TRADING FUNDS MORE THAN HALF OF THE AVERAGE PROFITS OF THE TRADING FUNDS PER PERIOD. This division and adjustment of the funds has been applied for many years in buy and hold investments by professor Michael LeBoeuf.
2) THE ONLY CERTAINTY, WHILE TRADING IS ALSO OUR FIRST PRIORITY: WE MAY DETERMINE THAT OUR LOSSES AT EACH POSITION WILL NOT BE LARGER THAN A SPECIFIED PERCENTAGE DEFINED BY THE KELLY CRITERION (see below or posts 3, 13, 33)
3) FOCUS ON MACROSCOPIC INSTRUMENTS LIKE STOCK INDEXES WITH PERMANENT STRONG LONG TERM TREND, even if you want to trade at short time scales. (e.g. of the American Economy which is young and strong and indexes like Dow Jones, SnP500, Nasdaq etc)
4) FOR VERY LOW RISK AT OPENING POSITIONS ON THE PREVIOUS INDEXES WITH PERMANENT STRONG TREND, OPEN AT TERMINAL SPIKES AGAINST THE TREND. This is the Bill Williams technique.
5) THE ASSESSMENT OF THE PATTERNS OF THE MARKET REQUIRES THAT IT IS DONE IN MANY SUCCESSIVE TIME FRAMES CHARTS. This is a basic recommendation by Alexander Elder, which, by now, it is a common knowledge to traders
6) BE FLEXIBLE IN FORECASTING THE MARKET AND DO NOT HESITATE TO FOLLOW PROMPTLY ANY UNEXPECTED CHANGES OF THE TREND OF THE MARKET.
THE TOP 6 FACTORS OF ATTENTION IN MANUAL TRADING
1) NEVER USE ALL YOUR FUNDS FOR TRADING. DIVIDE THEM TO TRADING AND NON-TRADING FUNDS BY THE RATIO f=R/a^2 RULE (see below for this ratio or in posts 3,13,33). THE DIVISION OF FUNDS AT EACH PERIOD IS ADJUSTED TO CONFORM WITH THIS PERCENTAGE RATIO. NEVER WITHDRAW PER PERIOD FROM THE NON-TRADING FUNDS MORE THAN HALF OF THE AVERAGE PROFITS OF THE TRADING FUNDS PER PERIOD. This division and adjustment of the funds has been applied for many years in buy and hold investments by professor Michael LeBoeuf.
2) THE ONLY CERTAINTY, WHILE TRADING IS ALSO OUR FIRST PRIORITY: WE MAY DETERMINE THAT OUR LOSSES AT EACH POSITION WILL NOT BE LARGER THAN A SPECIFIED PERCENTAGE DEFINED BY THE KELLY CRITERION (see below or posts 3, 13, 33)
3) FOCUS ON MACROSCOPIC INSTRUMENTS LIKE STOCK INDEXES WITH PERMANENT STRONG LONG TERM TREND, even if you want to trade at short time scales. (e.g. of the American Economy which is young and strong and indexes like Dow Jones, SnP500, Nasdaq etc)
4) FOR VERY LOW RISK AT OPENING POSITIONS ON THE PREVIOUS INDEXES WITH PERMANENT STRONG TREND, OPEN AT TERMINAL SPIKES AGAINST THE TREND. This is the Bill Williams technique.
5) THE ASSESSMENT OF THE PATTERNS OF THE MARKET REQUIRES THAT IT IS DONE IN MANY SUCCESSIVE TIME FRAMES CHARTS. This is a basic recommendation by Alexander Elder, which, by now, it is a common knowledge to traders
6) BE FLEXIBLE IN FORECASTING THE MARKET AND DO NOT HESITATE TO FOLLOW PROMPTLY ANY UNEXPECTED CHANGES OF THE TREND OF THE MARKET.
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