i just thought i’d share a nice analogy out of larry williams “long term secrets to short term trading”:
“Gracie is a world-class athlete, he is the guy in those Ultimate Fight pay for view TV shows. In case
you haven’t seen one, they are for-real fights, no boxing gloves and just about anything is legal from
kicking to gouging. This is for real violence. What is interesting about Gracie is that in over 100 fights he
has never been beaten. That is never as in never, ever. By anyone, boxers, kickers, elbow punchers, Tai
kickers. No one has been able to beat this guy.
Considering that most of these would-be tough guys weigh from 225 to 300 pounds, Gracie’s
accomplished victories are even more awesome when you find out he weighs about 180 pounds and looks
better in a Mr. Rogers sweater than fighting attire. You would never know the guy is a giant killer. Since I
am fascinated with fighters and winners (they have a lot in common with speculators), I have followed this
guy’s career and listened intently to his words of wisdom.
In one interview, these television thugs were asked if they felt any fear going onto these fights
because, after all, they are real-guys have been maimed, lost their sight, broken bones, suffered numerous
severe concussions, and at least one fighter has died. All the tough guys machine-gunned out their male
macho line about having no fear of anyone or anything.
That is all of them but Gracie. He freely admitted he is scared to death every time he enters the ring.
He went on to say he uses that fear to his advantage as it enables him to respect his opponent and not take
reckless action or deviate from his personal fighting style. [B]“Without fear,” he said, “you cannot win as fear
pumps me up for the fight but also assures that I will not lose control. What we do is very dangerous; my
best protection is to be afraid so I protect myself in all the ways of my craft.”[/B]
Like Gracie, I have an immense fear of trading, I have seen people wiped out, losing all they owned
from poor speculation. Some went bankrupt, some really did go crazy, and several killed themselves. I
suspect all these people had one thing in common: they did not fear the markets.
I think you need to fear the markets and fear yourself.
Although the markets are frightening, the emotions you and I interject into trading are downright
scary. [B]Without fear, there is no respect[/B]; if you do not respect the markets and fear yourself, you will
become one more dead body on the long trail of commodity market casualties scattered across the land.”
i feel that i, like probably a lot of others (i am especially adressing those who don’t have the patience to wait for a turn, break in ms and ote, instead enter totally counter trend) have not enough fear and respect. the market is going to eat you alive if you don’t. for me personally i think the problem is, that i don’t have enough money at stake. i am trading with just a couple houndred euros, that are not really enough to tickle that fear instinct in me. this results in myself taking trades, that are not as “perfect” (yes i know, there are no perfect trades, lets say trades with not as much confluences ;)) as other setups. i can pretty much identify these “bad” trades, thus i risk even less on those (like 0.5% or so). the problem is, however, risiking 0.5% only makes it worse, because hey, i can’t lose as much. it’s ok! but no! it sucks.
i for my part made a decision. best thing would be to just stop those trades. but that’s not how it’s going to work for me. my plan is now to save some money for 3 months or so. in the meanwhile i am still going to prove myself that i can be profitable, even with these “bad” trades. so without any excuse, i need to have a profit booked on my account in 3 months (aiming for approximately 20%). then i will double my account so that the fear will kick back in and thus i will stop taking these little f**k trades and finally get totally serious. the seeding is over. time to get serious and start harvesting.
it’s all cool to start with small capital to learn some methods, start dealing with emotions and all. but after 2 years of live trading, i finally need to take it to the next level.
p.s.: i won’t advice ANYONE else to do it that way. it is my personal decision, tailored from me to match my personality. i need fear and pressure to work correctly.
this post is mostly for my own personal benefit.
