Most precious trader’s capital.
THIS POST IS WAY OVERDUE. And the topic is dear to me. Literally dear in every way, because I have thought about it for years, worked on it for years, and paid dearly for missing it for years.
Question: what is the most valuable asset in the trader’s proverbial tool box?
Is it money? How much money the trader has to play with…
Or is it discipline? How quickly the traders can cut the losses and run the winners?
Or is it technology? The kind of software we use and the kind of trade signals we take?
Is it the ability to tap into the collective sentiment and get trade ideas that way?
In my opinion, NONE OF THE ABOVE!
Simply put, it has been my experience that Psychological Capital and Time are my most valuable assets.
How do I preserve my psychological capital?
I try to never listen to other traders. Try…and still sadly fail from time to time….because it is hard to actually do. We are bombarded by a flying mountain of garbage in the form of other trader’s ideas, opinions, blog posts, news posts, friend’s and family comments…emails, on and on and on. So to summarize:
NEVER LISTEN TO OTHER TRADERS. Don’t let them tell you how much money they made last month or last week. I guarantee it will play with your mind. Don’t let them tell you about the trade setups they took. Or will take. Become an independent thinker.
TIME is so precious because we can never get it back.
Trade your own trades,think for yourself, develop your own trading system based on simple and time proven methodologies.
Have a clear idea of how much time needs to pass for the trade to work or to fail. Spend the better portion of your free time analyzing your trading behavior and not the markets.
Pick only one mentor and work with that person exclusively.
Avoid the market chatter. Preserve your psychological capital and preserve your time at all costs.