Futures
Trading 3
The Evolution of a Trader and the Lure of the Holy Grail
Part II
- Developing Trading Skills
by Malcolm Robinson
To develop these skills we
need to get our feet dirty, plunge into the markets and have experiences. These
experiences are all good; they are the feedback we need to gauge our current state of
development. Without feedback we have no means of progressing. When I first started to
play tennis I did not go straight into a competitive game and try to win, I started by
learning the basic skills of tennis, the forehand, the backhand and the serve. As a novice
it was normal, expected even, for me to hit the ball repeatedly in the net or hit it
sailing out; this just indicated that I needed to work on these shots. Imagine taking this
approach to trading. Lots of losing trades is to be expected for the novice trader, it is
the first feedback, which reinforces the fact that the first skill of trading is to cut
losses short. A novice tennis player needs to learn to control the ball so that it lands
in the court; the novice trader needs to learn to control his losses. This is how we
learn; it is a constant cycle of trade – feedback – adjust. So what are the
practical steps for going about the business of developing trading skills?
If you are new to the
futures trading there are certain facts you need to know. This information will be covered
in most good introductory books and seminars, such as my own 'How To Trade The Futures
Market Online Course' When you have the practical information you need, open a trading
account and start trading. As a novice it is helpful to trade a simple, logical system.
This appears to contradict the stance I took against system vendors above, but what I am
talking about here is a systematic way of having a view of the market. My objection to the
system vendors is that they maintain that their system is all that is required to be
successful, whereas in reality it is the ability to implement a system or strategy that
determines success. As your trading skills evolve, your ability to read the market will
evolve; but until then you will have no valuable opinion, so a simple, logical system will
give you a reason to buy or sell. In my introductory seminar I demonstrate a couple of
workable systems, which are a good starting point. In attempting to trade these systems
two things will happen; firstly you will find out the issues you have that you need to
resolve in order to progress as a trader; and secondly in the course of trading the system
you will start to make observations and distinctions that will enable you to be more
discerning about picking trades. The issues that you will come up against will be the
feelings that arise that will prevent you from executing your system flawlessly. You will
need to neutralise these feelings so that you are no longer a victim to them.
I believe that to
have some sort of support while developing as a trader is vitally important. A trading
coach, for want of a better phrase, will help you to navigate when you feel lost, and will
give you an objective perspective when you are wallowing in doubt and uncertainty. As a
novice floor trader I found the support of my backer essential in developing trading
discipline. Support does not have to come from a professional coach, two traders could
support each other, or a novice trader could seek out a mentor.
In summary:
We need to have the knowledge of the
rules and tools of the game.
There is no system or strategy that
will turn a novice or losing trader into a consistently profitable one. Don’t waste
money on systems, they have very little value in themselves.
Systems though, are an effective
starting point to develop from, but be aware that no system confers the skills to apply
it, these must be developed over time.
Trading is a game of skill, these
skills are developed through experience, feedback and the ambition to evolve.
Finding some form of support will
speed up our progress.
Learn How To Trade The
Futures Markets
The Online Course Is Now Available!
http://www.TheMasteryOfTrading.com
Copyright © 2002. Malcolm E Robinson. All rights
reserved.
