STARTS OFF “Greed orientated.”
1 Market problems
a Not a zero sum game, a “very negative” sum game
b Market psychology – doing the wrong thing at the wrong time
c The majority is always wrong
d Market exists on chaos and confusion.
2 Own problems
b No knowledge
c No discipline
d No protection against market psychology
e Random action through uncertainty, broker’s advice for example
f Market views.
RESULT: the “greed orientated” trader gets a good kicking andbecomes “fear orientated.”
1 Market problems as above
2 Scared money never wins
3 Own problems
a Still overtrading – derivatives
b Fear brings on what it fears
c Tries to cut losses too tight creating more losses
d Still no real understanding of what it takes.
RESULT: Traders who persevere “travel through the tunnel” andbecomes “risk orientated.”
This is when they start to make money
1 Develop a methodology which give them an edge
2 Use an effective Money Management system
3 Develop the discipline to follow their methodology
4 Erase “harmful” personality traits.