Training a Stock Trader

What a trader requires to be Successful and Profitable ?

First, just as you should not trade based on a faulty idea, you should not use sand as a building material. Second, you need a solid trading plan as your trading – without it, you’ll slip into the sea, where 90% of traders reside.

First, you need to trade with a trading system and trading strategy. This means you need to  avoid all those hot tips,multi bagger ideas,jackpot calls , and ignore the so called experts  on blue channels. What you need to do is have a trading strategy that has been properly researched and tested. Then, you need the emotional power to trade the proven idea as is, without fail. Obviously, there are a lot to these two steps, but if you ignore them your trading house might as well be built of sand.

Second, a trading plan is essential to have a solid foundation, BEFORE you enter the markets with real money. What is involved in a trading plan? A good trading plan is written just like a business plan, since if you don’t treat trading as a business, you are destined to fail. So, all the sections that make up a good business plan (Mission, Products, Operation, Strategies, Disaster Plan, Financials, etc) should be in your trading plan. The more time you spend on this plan, the stronger your foundation will be.

Just as “castles made of sand, fall in the sea, eventually,” traders who ignore the fundamental ideas of

1) Trading a sound concept

2) Having a trading plan

will soon find themselves adrift in the “Sea of Losers.” Don’t let that be you.

As discussed above the ingredients for successful trading we teach them as a part of our trading courses and make traders comfortable in  learning how to trade using Intraday and Positional Trading Platforms and mastering trading psychology for Trading in Nifty and Stocks.

In Reminiscences of a Stock Operator we are offered an eloquent description of the training a successful stock trader needs:

“The training of a stock trader is like a medical education.

“The physician has to spend long years learning anatomy, physiology, material medica and collateral subjects by the dozen.

“He learns the theory and then proceeds to devote his life to the practice. He observes and classifies all sorts of pathological phenomena. He learns to diagnose. If his diagnosis is correct – and that depends upon the accuracy of his observation – he ought to do pretty well in his prognosis, always keeping in mind, of course, that human fallibility and the utterly unforeseen will keep him from scoring 100 percent of bull’s-eyes.

And then, as he gains in experience, he learns not only to do the right thing but to do it instantly, so that many people will think he does it instinctively. It really isn’t automatism. It is that he has diagnosed the case according to his observations of such cases during a period of many years; and, naturally, after he has diagnosed it, he can only treat it in the way that experience has taught him is the proper treatment.”

“You can transmit knowledge-that is, your particular collection of card-indexed facts-but not your experience. A man may know what to do and lose money – if he doesn’t do it quickly enough.

“Observation, experience, memory and mathematics – these are what the successful trader must depend on. He must not only observe accurately but remember at all times what he has observed. He cannot bet on the unreasonable or on the unexpected, however strong his personal convictions may be about man’s unreasonableness or however certain he may feel that the unexpected happens very frequently. He must bet always on probabilities – that is, try to anticipate them. Years of practice at the game, of constant study, of always remembering, enable the trader to act on the instant when the unexpected happens as well as when the expected comes to pass.”

“A man can have great mathematical ability and an unusual power of accurate observation and yet fail in speculation unless he also possesses the experience and the memory. And then, like the physician who keeps up with the advances of science, the wise trader never ceases to study general conditions, to keep track of developments everywhere that are likely to affect or influence the course of the various markets. After years at the game it becomes a habit to keep posted. He acts almost automatically. He acquires the invaluable professional attitude and that enables him to beat the game-at times! This difference between the professional and the amateur or occasional trader cannot be overemphasized. I find, for instance, that memory and mathematics help me very much. Wall Street makes its money on a mathematical basis. I mean, it makes its money by dealing with facts and figures.”

“When I said that a trader has to keep posted to the minute and that he must take a purely professional attitude toward all markets and all developments, I merely meant to emphasize again that hunches and the mysterious ticker-sense haven’t so very much to do with success.”

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