Keep trading as Part of a Balanced life

7. Keep trading as Part of a Balanced life:

Trading be it successfully or not, is a very stressful career. When
one is dealing with making and losing money based on your perceptions
the stresses can be enormous. You must do everything in your power to
eliminate the stresses.

I have never met or heard of a successful, highly stressed trader.
In fact it's quite the opposite. Most of the successful traders I have talked
to seem very relaxed and confident. I suppose this is what has made them
such success in the first place.

Reading Market Wizards' (Jack Swager) one common factor picked up on
all the best traders was their ability to disassociate them-selves with
the market action. It was almost as if they were unconcerned with their
positions. Considering some of these guys (and girls) traded with
hundreds of millions of dollars at a time this is a remarkable feat.
Most of the traders I know get excited when they have a couple of
hundred dollars at stake.

I know my own trading results went through the roof when I actually
spent less time "trying to control the market." By this I mean staring
at the quote machine and end of day graphs all the time. I took up tennis
lessons, jogging, reading, writing, even other business ventures just so I
could take my total focus away from the markets. Not only did my results
improve dramatically but so did my quality of life.

How can the top traders keep it so cool when the risks are so high?
Go through this book again:

1) They decided a long time ago to take responsibility and find out
what works

2) They have a system that fits them.

3) They plan every trade down to the finest detail ( wouldn't you if
you had $50 million at stake? more importantly they know when push
comes to shove they will follow the rules.

4) They have put the ground work into this system and continue to
do so.

5) They have complete confidence in both the system they follow
and in their own skill to flawlessly execute it.

6) They definitely view trading as a game in points and stopped
counting the money a long time ago. Most of the top traders are
very wealthy so if they aren't trading for enjoyment ( and winning)
they'd simply retire.

7) Finally they learned a long time ago that they alone can not control
the markets. Watching a quote machine and hanging on to "guru" advice
all day is a losing system. Most of the top traders have a life
out-side of trading. Realizing the importance of keeping it all in
balance.

Trading is no different from any other aspect of life. If your total
focus is on one point then every little dip and peak becomes exaggerated.
This kind of peak and valley emotional trading will not only ruin your
trading results but it could destroy you as a person as well.

Even if you was to make millions from the markets is it worth it at all
costs? Surely it's the journey that is important and not the arriving at
the destination.

In order to trade successfully you need to take time off. Re-charge the
batteries and gain some perspective. I remember my first few years as a
stock market player. I would spend all day, night, weekends reading,
studying, staring at the charts, trying different systems, etc....
Frankly I wouldn't wish it on any-one. Yes, I learned so much, without
the intensity of study I wouldn't have become so successful, so quickly
( 5 years) but if I had to do it again, or if I was giving advice to a new
trader, I would have kept my life much more balanced. "Work hard, play hard."
"Not work and work some more."

The stresses are big enough without making it the only focus in your life.
Take a ten year view on your performance. Realize that if you can gain just
a 30% return in the stock market year after year you are doing better than most.
Treat trading like any other business. Work hard from 9-5 and then be disciplined
to switch off and live your life.

Some of my very best trades have come from placing a buy order in the market
and setting a stop loss order with my broker. Going away for a months vacation
without looking at a share price. Coming back home and finding my share has jumped
by 40%. It never stops to amaze me how simple successful trading is.

Trading can be frustrating if you feel you can control the markets. There's this
feeling that by checking on the prices four times a day you will perform better. But
this is a complete waste of time and it leads you in to doing something stupid.
as long as you plan your system and follow those rules why would you ever need to
check on the prices during the day. Use the time intelligently and in so doing
it will give you more free time. Wasn't that the whole attraction of getting into
the stock originally?


Stock trading is a weird way to make a lot of money. We are brought up to
believe that to earn a honest days pay you must do an honest days work. But
if you buy $50,000 worth of stock at $50 and sell 1 year later at $200,
you have made $150,000 profit. Amazingly it only took 30 minutes to do this
as long as you checked the prices for 1 minute daily and followed your rules.
What elses is there to do? Yet, most people will have a problem making this
kind of money from the work put in. I am sure when the share hits $70 most
traders will snatch at the profits in order to take the sure profit and then
lose those profits chasing other trades. Yet it will be the balanced trader
who spends his time wisely and follows his rules who will always make the
big money.

So keep it in perspective. Realize you have no way of controlling the prices.
If you find your-self "itching" for more action then take up some interest AWAY
from the markets. NEVER try to make your trading more interesting or exciting.
If you do this you are forcing the markets into something that simply does not
exist.

If you spend more than 15 minutes per day managing your trades it's too long.
ask our-self whether you are trying to see something that doesn't exist.

Successful, profitable trading is:
* Boring
* Effortless
* Easy
* Stress free

AFTER you have MASTERED the "7 Habits of a Highly Successful Trader"
Are you going to spend the necessary time mastering these principles until
they become habits? A habit is something you do without thought. It takes a lot
of time and effort but the end results are worth it.

-Excerpt from the 7 Habits of Highly Successful Traders.