Banned!

So it appears I’m now banned from posting on Forexfactory as I’m classed as a trader selling a product and despite me not actively seeking buyers there, they still don’t allow any posting. I throughly enjoyed posting on FF and it’s a real shame that I can no longer post there.

Anyway, no point crying over split milk so I thought I’d make my post about trading psychology and the effect of being smart has on trading. I did have a well thought out post but I recently read a very interesting post on FF from an interview. Here’s a snippet of the interview:

Taken From:
THE NEW MARKET WIZARDS (CONVERSATIONS WITH AMERICA’S TOP TRADERS)
By: JACK D. SCHWAGER
.

Interview with Victor Sperandeo:

Schwager – “You almost seem to be implying that intelligence is an impediment to successful trading. How would you explain that?”

Sperandeo – “Assume that you’re a brilliant student who graduates Harvard summa cum laude. You get a job with a top investment house, and within one year, they hand you a $5 million portfolio to manage. What would you believe about yourself? Most likely, you would assume that you’re very bright and do everything right. Now, assume you find yourself in a situation where the market is going against your position. What is your reaction likely to be? “I’m right.” Why? Because everything you’ve done in life is right. You’ll tend to place your IQ above the market action.

To be a successful trader, you have to be able to admit mistakes. People who are very bright don’t make very many mistakes. In a sense, they generally are correct. In trading, however, me person who can easily admit to being wrong is the one who walks away a winner.

Besides trading, there is probably no other profession where you have to admit when you’re wrong. Think about it. For example, consider a lawyer who, right before a big case, goes out with his girlfriend and stays up half the night. The next day, he’s drowsy and inadequately prepared. He ends up losing the case. Do you think he’s going to tell the client, “I’m sorry, I went out last night and stayed up too long. If I were sharper, I would have won the case. Here’s your money back.” It will never happen. He can always find some excuse.

He would probably say something like, “I did the best I could, but the jury was biased.” He will never have to admit he was wrong. No one will ever know the truth except him. In fact, he’ll probably push the truth so far into his subconscious that he’ll never admit to himself that his own actions caused the loss of me case.
In trading, you can’t hide your failures. Your equity provides a daily reflection of your performance. The trader who tries to blame his losses on external events will never learn from his mistakes. For a trader, rationalization is a guaranteed road to ultimate failure.”

I read it a couple of times before how realising how much truth there is within the interview. Being able to handle losses is of paramount importance and the quicker we can deal with losses the quicker we can become a stronger, all rounded trader.

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  1. Don’t worry about it. I’ve found that most of the members are the blind being led by the slightly less blind. 99% of participants are well meaning amateurs.

    • Hi,

      I’ve now been made a commercial member which is a little silly as I have nothing to sell there. Commercial members are only allowed to post in the one section.

      Nevermind, as you say, there are a LOT of newcomers asking the same questions.

      P.S Read your site for a long time, looks like it’s still going strong.

    • stevetrade
    • December 23rd, 2009

    Forex Factory won’t even allow me to join the forums to post in the commercial section. It’s their loss, there are two sorts of people in the world. Those doing it and those talking about doing it. If they want to exclude the former then it’s to their detriment. Hope you have a good break John, we’ll talk in the new year.

  2. Besides the disciplined approach, I believe the most difficcult part of forex trading was understanding the processes and terminology of this dynamic money spinning environment.

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