Apprenticed Investor: The Zen of Trading
So far the
Well, it's time to shift gears, and since trading is an active enterprise, I'll discuss some things you should do. I plan to expand on these ideas significantly in future episodes.
Taken together, the following 10 rules will not only help you with the philosophical grounding necessary for thoughtful -- and successful -- investing, they will help you avoid some of the more common mistakes made by investors and traders early in their careers.
This is the "Zen of Trading;" It is more than an overview -- it's an investment philosophy that can help you develop an investing framework of your own.
Have a Comprehensive Plan: Whether you are an investor or active trader, you must have a plan. Too many investors have no strategy at all -- they merely react to each twitch of the market on the fly. If you fail to plan, goes the saying, then you plan to fail.
Consider how Roger Clemens approaches a game. He studies his opponent, constructs his game plan and goes to work.
Investors should write up a business plan, as if they were asking a Venture Capitalist for start-up money; just because
you are the angel investor doesn't mean you should skip the planning stages.
Expect to Be Wrong: We've discussed
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