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psycological difference between trading demo and real
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Member Since Apr 16, 2011 3 posts
fortress (fortress)
Apr 25 2011 at 02:29
Hi Psymon, I had a look at your trades. Firstly, if you're expecting to pay the bills from profits of $2000, then you're going to be sorely disappointed. As you said you put way too much pressure on yourself and blew your account.
Before you start trading seriously/full-time, you have to ask yourself these questions: 1. Do I have a reliable/profitable trading system - How much back testing have you done? 2. What is your profit to loss ratio? Are your wins bigger than your losses? 3. What is your win to loss ratio? Are you winning more trades than losing? 4. Do you have specific stop and profit take positions before you enter a trade? 5. How much of your capital are you going to risk per trade? (personally I wouldn't recommend anything over 1%, but that's just me - I noticed you lost up to 20% on some trades, that is insane and a sure way to ruin!!!) 6. What is your biggest drawdown? 7. How many trades do expect to make over a week/month/year? 8. After figuring out all the above you should have a pretty good idea of how much you need to make, and how much you're going to make. After figuring out the above you should have a crystal clear idea of what you expect from your system. All you have to do is trade it, this will completely take out all the emotion from your trading. At the end of each week/month, re-assess the above questions based on your results and keep trading. FYI I've blown two accounts in the past because I didn't do any of the above. So don't feel so bad. I am concerned that the $2000 was your life savings though. I wouldn't have risked it if were me. Anyway, goodluck! I hope you get back on your feet. no pain no gain. |
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Member Since Aug 06, 2011 85 posts
Gary Sharp (myfxpt)
Aug 08 2011 at 23:00
Don't go beating yourself over the head. Instead, congratulate yourself for actually DOING what many others only TALK about doing! You've taken the plunge, and like me, blown your account. Welcome to the forex initiation ceremony!
There is some great advice given above, and in particular that given by fortress. You need to get the psycholgy right, and this means gaining a good working knowledge of money management. Your knowledge of money management, and the employment of trading parameters resulting from money management, will give you the ability to trade without fear, hesitation, and greed. In other words, good money management eliminates the psychological factors that cloud our decision making. Don't give up! Keep it simple! |
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