As a veteran trader with more than 20 years of experience, young traders often ask me, "What makes a successful trader?" I often reply, tongue in cheek, "If I knew that, would I be teaching?"
No matter how you want to slice it, there is no easy answer to a question like that. Asking a seasoned trader, "How do I learn to trade?" is like asking a doctor, "How do you make a sick person well?" or asking an attorney, "How do you win a lawsuit?"
There is no 2-cent answer to a million-dollar question. In fact, it is this desire by many novice traders to find a pat answer to the process of becoming a net-winning trader that prevents them from succeeding.
I believe that successful trading is a learned skill just like any other -- except that what you have to learn is not what you first think it is.
Because I have had serious losses during my career I have had to re-evaluate my approach several times over the years. In the process of learning the business of trading from the inside out, I discovered that successful trading has very little to do with the markets themselves. I believe that 95% to 99% of successful daily winning in this game is a factor of personal trader psychology. I really don't think the markets have anything material to do with your ultimate success or failure. As a friend of mine is fond of saying, "The markets don't beat a player; they merely give the player a chance to beat himself." Most seasoned traders will likely agree with that statement and that is why I wrote
to help all traders -- old and new alike -- to stay focused on what really matters.
I've broken the material down into four distinct parts: "Getting in the Game," "Cutting Losses," "Letting the Profits Run" and "Trader Maxims." Each part is designed to give you a solid foundation within the overall context of personal responsibility.
If we assume the markets have little to do with our success and that our psychology of participation makes all the difference, then we must accept the responsibility for our results -- completely. We are the architects of our own fortunes, and the markets are merely the place we go to get it. Still, we must know what we are doing and more importantly, how to stop bad behavior. In my view, that is the most significant part of your daily trading: learning to stop losing behavior before it starts. This becomes your personal rule-set to begin your journey towards successful trading.
Each part of
Trading Rules that Work
builds on the others, and it is wise to start at the beginning and read the whole book through front-to-back before going into any one part more deeply.
Part 1. Getting in the Game:
Let's face it: You can't win a game unless you know the rules to the game before you start playing it. The first section of the book shows you clearly the true nature of the market environment so you can begin from a solid understanding of how the game is played.
Part 2. Cutting Losses:
Regardless of your sophistication or experience in the markets you can't really succeed until you master the skill of
when you are on the wrong side. No trader will master this game if he can't look himself square in the eye and say, "I am wrong. This won't work. I am getting out and finding another opportunity."
Part 3. Letting Profits Run:
The opposite and equally needed skill of holding winners is critical to lasting trade success. Most traders cut winners and hold losers. In this section I show you how to change this basic error to the proper function of holding winners, in addition to cutting losers.
Part 4. Trader Maxims:
In this section I show you the underlying psychology and common sense of such maxims as "don't trade the news" or "don't take tips." In truth, the only two skills you need to make your fortune are the ability to cut losses and hold winners. "Trader Maxims" gives you more detail on how to do exactly that.
I've made the language of the book very basic and to-the-point. Most readers have told me that they like the straight-shooting, no-punches-pulled style of the material. In my experience, the ability to communicate the basics well and add additional detail when needed is important, and with
Trading Rules that Work
I've done that.
Please consider me a friend in the business. If you feel like offering some critical feedback, feel free to do so. My editor and I are working on more material to be published soon, and your suggestions are always welcome.
To reach Jason Alan Jankovsky for any media purposes, please contact his publicist Kristina Vasilakis at Kristina.Vasilakis@gmail.com.
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