Costly Trading Mistake #2 (And How To IMMEDIATELY Fix It) – Becoming A Trading Junkie
The objective of a Trading Junkie is not to make money, but to make trades.
Too many traders become a “trading junkie” and over trade which is always a costly activity. A “trading junkie” overtrades because he feels he must make trades every day instead of waiting for the high probability set-ups. A “trading junkie” does not trade with a specific, written trading plan, but continually takes low-probability trades just for the sake of trading.
When I talk to someone on the phone or at a trading conference who is interested in Dynamic Traders Group products or services and they ask, how many trades does your “system” make each day (or week or month)? I know they are probably a trading junkie because what is most important to them is the frequency of trades.
When I speak with other traders and they brag about how many trades they make each day, I know they are probably a trading junkie who is not most interested in maximizing the return for capital, time and expense in their trading business.
Six Costliest Trading Mistakes You Are Making Right Now
(And How To Immediately Fix Them)
Costly Mistake #1
80%+ of Traders Lose and Quit Within One Year
How To Become One of the 20% of Winners
There have been several studies regarding the failure rate of stock and futures traders. The results are a majority of traders fail within a year of opening a trading account. The failure rate is typically found to be in the 70%-80% range. I suspect the failure rate at least for stock traders was much lower in the late 90’s as thousands of people first began their trading experience during the final years of the relentless bull trend when almost any bull market strategy from momentum buying to average down to moving average crossovers was profitable. I suspect the failure rate is higher than the average from 2000 to the present when you actually had to have skills to achieve consistent profits.
Most people who trade are aware of these failure statistics. And, most beginning and experienced traders think they are part of the 20%-30% of potential successes, when in fact, they usually end up with the majority who fail.
Experienced traders are not necessarily successful traders. In the 20 years of teaching how to trade around the world, I know a large percentage of the private traders end up trading more for entertainment or the challenge than to make it a profitable business.
I don’t mean to start this series off on a negative note. But, I do want to be honest and realistic with the reader. You have to decide if you are in the business of trading to maximize profit for the capital and time you invest, or if you are trading for entertainment. My job for twenty years has been to educate traders. That is what I am good at. I’ve helped traders in over 30 countries turn their trading around to a consistently profitable business. I can help you do that as well if you are willing to make some changes.
The Friday Sept. 13 video update we produced for DT Report Subscribers described why a top lasting from a few days to a few weeks was likely just after the Spet. 18 Feb meeting. It also described why the pattern structure of the decline off the Aug. 2 high and subsequent advance into mid-Sept. has probably changed the intermediate term trend outlook for the S&P.
All of this type of analysis and trade strategies are taught in High Probability Trading Strategies. We keep DT Reports subscribers up to date with the daily reports for ST traders and the weekly video updates for the probable best trade setups for the upcoming week and any changes to the Intermediate Term trend position.
If you want to expand you knowledge of what you learn in the book, consider at least a three month subscription to one of our daily reports for an ongoing education of practical analysis and trade strategies.