Trader Mindset How to build your trading rules
Jun 14, 2024
Discover the intricacies of building effective trading rules by exploring the role of personal behavior and emotions in trading success. Learn how position sizing can be more important than entry points, as it directly relates to traders' psychological responses to risk. Dive into the world of risk management and confront conventional financial beliefs, encouraging a mindset shift toward smarter experimentation with minimal risks. Tune in for valuable insights that can transform your trading approach!
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Behavior Over Patterns
- Trading success depends more on how you trade patterns than the patterns themselves.
- It's your behavior, not chart patterns, that determines trading outcomes.
Position Sizing is Key
- All trading systems are discretionary because you select inputs and position sizes.
- Position sizing is the key factor in managing gains and losses, more important than entry precision.
1987 Market Crash Anecdote
- In 1987, many pros anticipated the market crash and positioned accordingly.
- The crash was triggered by a political decision that led to a cascade of sell-offs.
