| |
| |
|
Stocks & Mutual Funds |
|
|
|
Articles and Information about Stocks and Mutual FundsNetFinancial | Institutions | LoansColleges and Universities | Search Engines Stock Trading - Daddy, Why Arent We Rich?
One Saturday morning, while he was sitting at his computer studying the market, David's 7 year old daughter came up, tugged at his shirt sleeve, and said, "Daddy, why aren't we rich?" He looked his child in the eye, and thought to himself, what a great question - Why aren't we rich? As she stood there expectantly waiting for an answer, he struggled to come to terms with the realization that, although he had focused his complete attention on trying to create wealth for more than 10 years, he had never actually made any real headway. He had bought and sold many Stocks and several properties over those years, but had never made any real money. He looked at his daughter, and asked, 'What makes you think we aren't rich, darling?' She looked at him and said, 'Because you said that if we were rich, you and mom wouldn't have to go to work any more, and you both still work all the time. You said we could live at the beach and play in the sand every day. I want to know what you are doing about that. When can we go and live at the beach?' Nothing like a child to cut straight to the heart of the problem - and what was he doing about it? 'We're not rich because daddy made some mistakes,' he finally answered. 'What kind of mistakes, daddy,' she asked. 'Well, I bought some shares that were going down and then didn't sell them soon enough. Then I bought some houses but sold them again.' 'Why?' she asked. He had to think about that. He had no reason to buy those shares in the first place. He had no reason to hold on to them when they kept going down. He had no reason to sell the properties either. Her logic was flawless - why? He had to change his strategy. He owed it to himself and his family to finally get his act together and make some changes - that was the day the pain of not living up to his potential made him sit down and write out his trading plan and his goals...his strategy and rules - his life raft. He started by writing out his vision - what he wanted his life to look like when he became a successful trader and investor, then worked backwards from there - through the details of how he was going to achieve his dream. He saw in his mind the 4 bedroom apartment on the beach, the red Ferrari 360 Modena, the plasma screen computer monitor in an office overlooking the surf beach 7 floors below, the family holidays in the Greek islands, the significant donations to worthwhile causes and children's charities. He visualized all the tremendous benefits of becoming a successful trader. He realized that he was afraid of losing, and that fear was just too expensive to let it control his life any longer! He decided that he would no longer accept anything less than full compliance with his trading plan. He decided that he would take every trade entry signal and follow his trading plan as if his life depended on it. As if, after each trade was closed out, he had to stand in front of a Panel of his trading Mentors, and explain his actions to them - why he entered where he did, where he placed his stop losses, why he exited when he did. And if they weren't convinced he followed the rules of successful trading, he would be taken out and shot! This certainly focused his attention on only trading strong trends - trends where the price bars were trading above their respective moving averages for long trades, or below for short trades, and the Stock price was moving strongly in one direction. He pretended that if he couldn't justify his trading decisions to his trading Mentors, he was dead... That was the day he resolved to study his selected group of Stocks, the ones that had a track record of trending strongly, every day. He would then take every trade his system produced, put his stop loss orders in the market as he entered each trade it a place where the trend had to change to take him out of the trade, and he would hold every position until the trend changed. He would act 'as if' he was a great trader, even though his record up to that point had been less than inspiring... That innocent question from a child turned out to be the start of David's successful trading career. He started to trade profitably and consistently for the first time in his life. He thought he was doing well, and indeed he was making money. He knew from his wealthy mentors that rich people are different; they make rational decisions based on facts, not emotions. They understand the value of money - they respect it as a tool for building a better world. They buy well for logical reasons and hold until there is a valid reason to sell. Then one day, he closed out a trade, and excitedly told his daughter, 'Daddy made a big profit in the market today darling, come and look and see what I did.' His daughter came over to the computer and looked at the screen as he excitedly showed her where he had bought a Stock and then sold for a $3000 profit. She looked at him and said, 'But daddy, it's still going up, why did you sell it?' His smile faded as the power of that question sunk in...why had he sold it? What was he doing getting out of such a strongly trending Stock just to take a profit? What would his trading Mentors say? She was right...the market was still open, so he bought back in again. He had never been able to bring himself to do that before - he was becoming a great trader! The rally continued and he kept buying more as it rallied. The trend finally changed, but his profit on that trade, when he eventually got a valid sell signal, was $14500! His daughter's question 2 weeks earlier was worth over $11000! That was the last time he ever got out of a trade based on his emotions. His fear of the market was gone - thanks to some simple questions from a 7 year old... So now, it's your turn. Whenever you are preparing to place a trade, find a small child, even if you have to borrow one, and ask them what the trend is. Then don't trade the other way! If your trading isn't as great as you know it could be, decide to create a trading plan now that will become your life raft. Remember, fear is just too expensive. If you are afraid of losing money, reduce your position size until your fear goes away. Once you have made a series of small profits, you will be trading with the markets money and you can increase you position size according to your growing confidence and account balance. If you have a series of losses, reduce your position size again until you get back on the right track. Stick to your trading plan - whether it's the one that Peter outlines for you on the website or something else you have tested by paper trading until you are confident that it works. Then, just do it! To Your Trading Success, Tony Spann and the Team Stock Trading Review is dedicated to helping you succeed as a trader by sharing with you simple and easy to follow tips and techniques. Discover more insider secrets and the exact proven strategies to trade stocks profitably: http://www.stocktradingreview.com Copyright(C)2005 Stock Trading Review
MORE RESOURCES:
Stocks-Mutual-Funds - Google News |
|
|
|
RELATED ARTICLES
Play another Day Money management starts with protecting your capital, realizing profits and cutting losses. As I have stated in the past, without cash, you can't invest. Stops Make Money During the day I watch CNBC-TV, the stock market channel. Fortunately, I keep the sound muted or I would be hollering at the dumb "experts" being interviewed. Pathways During our travel down life's path we come to many places where the trail divides and we must make a decision. Some involve psychological (emotional) choices - marriage, divorce, leaving home, career changes, etc. Mutual Funds are Dead You may have wondered why your mutual funds have been going down for the past 2 years. The answer is very simple, but not one you will hear from Wall Street as they want you to send money. Hot Stock Trader: How to Pick Momentum Stocks with Ease and Simplicity Most stock traders know that momentum trading can be a very profitable activity. You can make big amounts of cash in a short period of time. Swing Trading Strategies Using Swing Trading Strategies and Technical Analysis when Trading Stocks to Make Consistent Trading Profits.This article is one small part of a series of lessons using Swing Trading Strategies and Technical Analysis developed by WD Gann which are designed to show how anyone can build a profitable Stock or Commodity trading business from scratch. Analyst Reports When you become interested in a stock or mutual fund you can call your broker and he will send you reports on how the company is doing, what their management is like and what might be the projected earnings for the company and how the industry is doing. Great information. Successful Trading - Taking Profits - Part 2 Suppose your position has made a big move and you moved your stop to your purchase price as recommended. Then let's say your stock continues to make a big move and now we're asking again the questions we asked back in the first paragraph. Price Targets Every day in any financial publication you will find the Wall Street mavens giving their predictions on many stocks. It was issued here and should go there. How To Make, And Keep, Money Trading Stocks If you are serious about making and keeping money by trading stocks, then there are three things you need to do, and do well.Money managementOrdersTrading systemMoney managementMoney management comes first. Is The Bear In The Cage? For the last few weeks we have seen the stock market averages going higher and higher each week yet the economic news is still very bad. Is this bear market coming to an end? Will the stock prices and mutual funds go back up to where they were?It seems all the talking heads on TV and the talk radio guys are telling you that now is the time to buy because the market will be much higher next year. Trading Tips No 2: The Big Lie in the Stock Market It is commonly reported that the stock market averages about 10% per year return over the long term (decades). So the investor that buys and holds a diversified portfolio of stocks or mutual funds is led to believe that their portfolio will grow by 10% per year on average. The 10 Commandments Wall Street has been preaching for years and years to investors how and where to put their money. The "experts" have put forth these ideas for so long that they seem to be carved in stone just like Moses did with God's 10 Commandments. Stock Market Investing Odds The greatest stock market myth is the idea that investing in stocks is a form of gambling!The financial markets are often compared to a casino. Put some money on X stock and you might as well be playing craps!If that's your impression, and it's keeping you out of the markets, consider this:If investing is organized gambling, it's one of the rare kinds where the odds are stacked in your favor!Why is that?Corporate profits are the key to understanding the investor's edge. Bargain Basement - Finding Stocks That Go Up Have you been listening to the talking heads on CNBC-TV? Or those talk radio stock experts? Getting all those good recommendations on what to buy now. Now?Those guys keep telling me the market is oversold. What is the Most Important Indicator of All? Most stock market traders have a favorite technical indicator.The one that they have the most confidence in. My Neighbor Got A New Car I don't know what kind it is, but I saw iton TV running full speed along the shore (I don'tlive near the shore) throwing up spray or maybeit was that one climbing up the steep mountaintrail thru the mud, rocks and snow. Veryexciting. 365/7/24 What does it take to be a stock trader? It takes a total mentalcommitment to the task. It becomes a complete way of life. Series 7 Exam What is the Series 7 Exam?If you are looking to become a licensed Stockbroker, you need to know about the Series 7.The Series 7 is a 250 question exam that when passed, licenses you to act as a Registered Representative. How Commodity Trading Differs from Stock Trading There are major differences between trading stocks and trading futures. While stories of fortunes made or lost overnight on the futures markets are largely untrue, the futures trader, if using a sound trading system, can usually make more money on the futures market and make it much faster.
|
|
Currency Trading | Investing | Leadership | Negoatiation | Real Estate | Stocks and Mutual Funds | Taxes home | NetFinancial | Institutions | Loans | Colleges and Universities | site map Search Engines | EZmatic | 0pops | GetSonic | TrafficFish | Health |
| © 2006 |
