- 1998: Volume 7, No. 1 Improve Your Trading Performance

It is in many different people's interest that a trader should be successful.

Obviously, from the traders' point of view, if he doesn't make money, he won't be a trader for very long. But equally it makes life easier for the many people involved-his broker gets an account that grows (instead of chasing new business only to close due to losses), his data vendor who gets a steady reliable income, and his friends and family who share in his gains.

I regard myself as a success. Do you? My definition of success is "to live a life of my choice" and this I have been fortunate to do. 

A Yardstick for Success

I am 36 years old and "work" for an hour each morning. I have spent the last eight years trading my own capital and have lived where I want, worn the clothes that I want, worked in setting of my choice, spent as much time as I wanted with my young family (or as little!). I have answered only to myself and I love what I do. As I write this article, we are spending three months in a skiing chalet in the French Alps.

This is what I want from my life and I am fortunate enough to have this wonderful toy called the market that allows me the flexibility and funds to make a good living. I have also worked steadily to get to this position.

The reason I have described my life is not that I wish to blow my own trumpet. I am far from rich compared to some people in this business and am certainly not the best trader in the world. But I would like to suggest that the key to succeeding in the markets is to know what you want from it and from life. This is where success in the markets starts and finishes. 

A Personal Approach

The market is so flexible that it can accommodate many different personalities, desires, trading styles and timeframes. It is imperative to know what you want from it.

If, for example, Warren Buffet worked on the floor, he would probably not have become one of the world's richest men. He knew that his personality was such that he needed time to sit, think, wait, and build slowly. Similarly, if the best floor or screen day traders were to take this approach, they would never make it. Their personalities thrive on people, action, and adrenalin.

If you read through any futures publication, you will see a preponderance of advertisements promising "the Secret of the Markets," "The Ultimate 250% pa System," "How to Make $2M from Futures," etc. I am sure all of these must be true, but the question must be why isn't there a huge production line of millionaires? The answer is that they do not suit your personality.

Checklist for Success

I believe the following reference list is a starting point to whether we will succeed or fail in the markets:

1. Be yourself. Are you a Warren Buffet or a floor trader? Do you sincerely want to be rich-can you handle the status? Do you have adequate self-belief and self-discipline? Do you love what you do?
2. Determine a written list of what you want the market to give you in both money and lifestyle-make it concrete, detailed, with actual profit requirements. Where will you live, work, be with all day? Visualize this (if you are not familiar with this life force process, explore it).
3. Experience and experiment with a dozen trading styles using books, software, etc. Choose one that speaks to you. Paper trade for a few weeks. Replicate it absolutely as it will be when you start for real-minute by minute, day by day. Really feel the emotion.
4. Read about risk/reward and money management. Diversify, keep bets of a containable size.
5. Begin slowly. Don't give up your day job or order that Ferrari just yet.
6. Continue to visualize daily, mold your skills, be totally self-disciplined and consistent in following your rules and plan. Every trade, every day.
7. If it isn't going like it should, get professional help!

I have become fascinated with the reasons why some people succeed and others fail in the markets. After 15 years of experience, I know and have seen plenty of both. I am now convinced thatone of the biggest problems traders have is the belief that the most important ingredient is a Holy Grail or magic system to produce the profits. This is a totally misdirected obsession and ill-conceived belief.

Traders spend all their time working on this single aspect but in my experience, it is no more than 15 percent responsible for success. Much, much more (85 percent) of whether we succeed or fail is due to other factors which are often completely overlooked and ignored. It is these factors that what we should be focusing our attention.

Improve Your Performance

Consequently, as well as my trading, I also run an "Improve Your Trading Performance" consulting service. This is available on a one-to-one or small seminar basis and is designed to help anyone who would like to do better in the markets. From professional traders who feel they could improve, to would be traders who need a game plan, a strategy and the confidence to begin, brokers who want their clients to do better, or anyone else who has an interest in making money from the markets.

Our research shows that success is approximately 55 percent psychology, 30 percent risk management, and 15 percent methodology. We concentrate our efforts on these areas. Regardless of the markets traded or the style, timeframe or experience level of each client, most will subsequently improve their performance.

In March 1998, a brief introductory workshop for this service will be held in London. Please contact Priya Radia at 44-141-842-4081 or Andy Robertson at 44-181-879-0909 to register your interest or to receive details.