New York Traders Expo Interview #3
In this video, Stuart McPhee conducts an interview at moneyshow.com video network. Usually, Stuart talks a lot about having a trading plan, and one of the most important things is the psychology of trading which most traders are not using it. The last thing that people consider when they start trading is how their mind will play a role in their trading success. In making mistakes and losing money our mind plays the most important role. For the success is the same. We make so many things from instincts and we evolved through many years based on our instincts. But in trading you cannot do that. Everything you have to do is against trading instincts.
This leads us to discipline, to what we have to do rather than to what we want to do. It is one of the most important attributes successful traders have. When people start trading they think trading is easy money. How hard can be buying and selling? Discipline is a key for success in trading. The host of the show says that most people think that they should start on Forex. Stuart McPhee says that this is a critical thing because many people are trading the wrong instruments because they not suit for that type of market. So may different markets have different levels of risk and all of them have different tolerance of risk. So if the risk tolerance is different managing risk is a vital part of what you do. This leads us to believe that we cannot trade all type of markets. So many people trade wrong things.
Some prices of some instruments move so quickly if you are not mentally experienced and disciplined enough, you cannot keep up. You will make the wrong decisions. You need to build a foundation before exploring other markets. Stuart says that people should start with a slower moving strategy because when you start you don't know enough of what you are going to do. When you trade stocks, of which prices don't move so quickly you have the time to think about things and execute the trade. Other instruments move so quickly that if you delay and hesitate and you are not really sure of what you are doing there can be devastating consequences. If you start with something easier you can build some confidence and some competence.
Stuart McPhee quotes from this video:
- We make so many things from instincts and we evolved through many years based on our instincts. But in trading you cannot do that. Everything you have to do is against trading instincts.