Most games are played in a controlled environment.
The rules, opportunities and threats are fixed, and known to all players.
In a poker game for example, we know in advance that there are 52 cards in the deck, divided into 4 suits […]
Below you see 6 boxes on the left, and 6 boxes on the right:
The contents of the boxes to the left have something in common.
The contents of the boxes to the right […]
Sometimes I make a good trading call, and get complimented on my trading “skill”.
It’s flattering of course, but the truth is that it isn’t so much about skill, as it is about experience.
If you get punched in the face every […]
Throughout our lives, we’re constantly told to be “true to yourself”.
This is the kind of advice everyone likes to hear, because it makes us feel good. No one likes to be told to be less of ourselves.
Unfortunately, this is also […]
I often receive questions along these lines:
“What’s the best way to predict a price reversal?”
“What’s the best combination of indicators?”
“What’s the best trade entry/exit signal?”
Almost everyone who comes into trading asks such questions at one time or another.
Pretend-traders like to talk about all kinds of trading theories. In their heads, they develop elaborate strategies about how the market should be traded.
What they don’t realize, is that what they think is often different from what happens in reality.
Despite […]
Intuition is a tricky subject, because there’s no way to prove or disprove that it exists.
Consider though, that there’s a strong psychological incentive for human beings to provide an explanation for coincidences: we want to feel in control.
A mother loses her child in the mall, […]
On Friday July 15, I took my largest one-day trading loss ever. It was a position on the USD/JPY that was closed for -$11,182.39.
Needless to say, I was more than a little shaken up that day. What started out as […]
I once attended a university class where each week, a well-known CEO was invited down to speak with the students.
This was one of my favorite classes, because unlike the usual lectures held by university professors, these sessions were led by […]
This post is the second of a 2-part series. You can read the first part here.
Now here’s the next harsh truth about trading for a living:
The pressure to perform is a big disadvantage.
In a […]