Why indiscipline...?

Army man discipline Discipline is directly related to the bottom line of a traders not only in the stock market, but in all the markets. The professional trader always tries to be disciplined and stick to his system. He himself follow disciplinary rules thinking always about protection of his money, making of money and always remain positive minded at the end of each trading period. He remains on sidelines when price movement is in narrow range and places stop losses while trading during that period. He moves his stop loss as the market moves in his direction. In every order he keeps priority in protection of capital employed and while protecting capital he aims to make money. He stays within the parameters of his risk and reward. His primary object is to profit, but capital should not be diminished to a large extent while trading. He acts just like a person aiming to shape his body. If you have a desired body shape in mind, then you will definitely eat and exercise accordingly….Exactly same is with the professional traders. He follows all the disciplinary rules like an army man. Accept the results whatever may be… While trading, whether it is in stock market or any other market, a trader either make money or lose money in any given trade. The ultimate result is aimed to make more money in the right trades than what is lost in the wrong trades. While doing such trading a professional trader learns to accept failure as a part of trading activity, but he also uses this failure as a learning tool. In fact what he learns from the losing trade is more valuable than what he learns from profit giving trades. His such type of psychological acceptance boosts him up with courage and next time he enters into a trade with utmost good faith and self confidence. Put aside ego… It is easy to recognize profit from a loss. It is easy to understand disciplinary rules framed for trading. Then what is difficult….?What makes it so hard to apply the rules…? There is some power which controls our mind and prevents a trader to act as per the pre determined course of action. Let us call that power as “Ego”. Until a trader learns to get rid of his ego, he will never make money in any market consistently. The market gives rewards only to those who have subdued their egos. This is so because when a trader does not identify his ego, he never accepts his mistakes done while trading and this prevents him in correcting these mistakes. He only goes on finding various arguments in the favor of his trade which is in fact a wrong one. So long as a trader makes money following his trading strategy and rules framed by him therefore, it is well and good. But after getting some success in few profitable trades, when he starts compromising with the rules framed already, and ultimately suffered a lot at last. Why…? If you make profits in some trades, naturally you cann’t resist telling you mates how well you are doing. Aiming good for them, you just tell them how easy it is to make money in the market (and how clever you are). All good things come to end when market changes its trend. It becomes harder for you to find good trades. You are frequently stopped out of your positions …incurring series of small losses. You start doubting your own decisions and trading strategy. You start changing your trading rules, looking for other additional indicators for confirmation, though they give conflicting signals. You forget your own original trading technique and rules …and now you concentrate on new technique with new rules…..and it wipes out you totally…..This is “Ego…” playing its vital role in making a trader undisciplined. There are so many trading courses available, but many fails to prepare traders how to face market place. They simply present trading plan with some examples where plan works very well, explain basic concepts only. It if is so easy, then why to sell such trading courses. Such courses fail to prepare and teach to traders for the times when their plan does not work. Such training courses fail to prepare and teach the trader for the pressure and uncertainties that he will have to face when the market goes against him, and how to come out from them. Many times trading courses are marketed on the assumption that the average investor is greedy and lazy. They offer only the prospects of wealth without effort. Of course, trading courses may help to gain good working knowledge of basics and explanations about traps and pitfalls that a trader faces everyday in the market. But such courses cannot teach any trader about self discipline and understanding of his own weaknesses. Only experience and lots of practice help in this line, there is not any magic formula for this. Let me quote the lines I read at site : http://www.incrediblecharts.com If you can’t stand the heat…. ….do not play in the kitchen…… If you do lose money in the market, don't blame your course provider, your broker, the institutions, insiders, the government, OPEC or the Fed. They are just some of the factors that you have to take into account in your preparation. You are responsible. You are on your own. No-one except you is going to shed a tear if you burn your capital. So take care ...... and PREPARE…!!! (to be continued......)