The real quality it takes to succeed at trading

The qualities amongst these people are not the standard qualities you might think of or read about in the many articles on what it takes to achieve great trading success. For example, you'll read standard stuff, such as how you need patience, discipline, composure, focus, etc – These are standard behaviors you need to do well in any activity, you could say the same about playing poker with your friends. Traders tell me of times where they were impatience, ill-disciplined, lacked composure, and focus. No one can escape being human. "Even Messi has bad games." These trading champions are far from exceptional when it comes to doing the unforced errors of trading. Admittedly, they may do them a little less, but they still do them with regularity. This is not where I believe they excel. They excel in other ways. Ways which may not seem obvious, and though some work long hours, I would not say any of them work longer hours than any other trader, and quite possibly less in some cases. And it is not their approach which is their edge either. There is every type of trading possible. Long-term equity, portfolio managers, momentum based macro-traders, trend-followers, relative value players, in and out day-traders and intraday traders, multi-strats, contrarians, event-driven players, semi-systematic, all types. No type of trading has a monopoly on trading success or is superior. The reason I believe that is, is because it is not the method or the system, but the person. One thing they have done well is chosen or evolved a type of trading well-suited to their personality. This is a factor not to be understated having a strong alignment between who they are, their personality, their risk philosophy their risk management style, their method/approach, their resources, and how they engage with the markets makes it easier for them to bring the best of their self to their work. But it is another type of alignment where I feel their game is won. Self-Alignment. That is a strong alignment between them and their self. That is, their true-self, not their ego-self. They have developed, nurtured, and built a strong and trusted relationship with themselves.

Why is this so important, and such a powerful edge? When you have a great relationship with yourself, you trust yourself, you believe in yourself, you resource yourself, you are self-reliant, and you can live with yourself when the pressure hots-up, and you make the inevitable unforced errors or have off-days. You are willing to back yourself, and thus you invest in yourself in key moments in the market because you trust yourself. By investing in yourself, I mean invest in doing the things that others won't: Pulling the trigger, listening to what their intuition is telling them, being that little bit more comfortable being uncomfortable, accepting they do not know and being Ok with that, changing their mind, having an open mind, not being stubborn. They can be more confident in the face of uncertainty, and less likely to doubt themselves in key moments. Not that they are strangers to doubt, they all have times when they will doubt themselves, that is human nature, but they are less likely to be negatively affected by this and can pull themselves back from these moments quicker. They are thus less likely to be owned by the market and the situations, they find themselves in, and are more likely to be owning their own journey. That provides a powerful edge which means they can pull the plug quicker on ideas that aren't working, and can commit to increasing their commitments to things that are working. These people aren't perfect, far from it. They don't know any more than anyone else, or have superior news, information, or insight. They get all the same data as everyone else. But they do not feel they have to take a trade because someone else is taking it, or that they need to adjust their position because someone else has an opposing view. They are comfortable in their process, and above all comfortable in their own skin. If they are wrong, are quite happy to own that. And when things go wrong, they do not engage in beating themselves up (if they occasionally do, they let go, and forgive themselves quickly). They accept responsibility when it is their error because they can live with themselves, they can accept that sometimes they let themselves down. And though these moments may be painful, they do not sweep them under the carpet, they reflect on them, learn from them, and rebound quickly. They are masters of one of the great ‘soft powers' self-compassion (they know no one else will do it for them). These people develop this relationship with themselves because it is the only option. If you are going to win in this difficult job, you need to be your own best ally, not your own worst enemy.

They literally have their own backs. They respect themselves and value themselves, not so highly that are arrogant. And they though they practice humility, they do not do it so much that they do not know their own self-worth. They do have egos, after all, they like coming out on top. But they work with their ego to drive them on, and they try (with emphasis on try) to not to let it corrupt their process. On all these points, these traders are not perfect, far from it, just much better than most others.

Their strong relationships with themselves did not happen by accident. It was a deliberate effort by them. And they sometimes falter, helped by the market, but when they do, they act quickly to re-connect with themselves. This development of a strong self-relationship sounds easy in principle, but its far harder in practice. Of course, a trader still needs a viable method and process (outer game), no amount of high-quality self-relationship (inner game) will overcome a flawed outer game. But once they found that, they then worked to develop themselves at the inner game level. The development of a strong inner game is far harder than the development of the outer game. You're fighting a lifetime of behaviors, tendencies and coping mechanisms, that you've evolved, which may have been suitable to get you were you are, but which may not be right for the extreme conditions and radical uncertainty of financial markets. It requires deep and hard transformational work, sacrifice, and being willing to be vulnerable, sometimes going against the grain to develop a new relationship. That is the challenge.

Every single one of those traders chose to work with a coach. That is an example of making themselves vulnerable and going against the grain. They were willing to ask for help, to expose themselves to scrutiny and to look in the mirror and heed what came back. It wasn't the coaching that made them great; they were already on that path. But the coaching helped them along the way, provided support, reassurance, smoothed out the rough edges, helped them overcome speed-bumps, challenged them, and helped propel them further, faster. You won't read anywhere on how ‘Developing your relationship with yourself' is what it takes to succeed in trading, and yet this is where the game is ultimately won. The battle is a mental battle, within you, not out there, that makes it possible to win out there.


You will repeat the same trading mistake until you stop breaking your rules.


You don't need to be a genius with macroeconomics or be a master technician to make money in trading. You need a strategy you believe in, be willing to be wrong, master executing your strategy, press when things are lined up & have a calm demeanor when it comes to managing your money.


Sometimes you win, sometimes you lose. This is trading, but more broadly, this is life. What matters isn't so much how often you win, but how much you win when you win and how much you lose when you lose.


It's not about chasing profits; it's about protecting what you have. Shift your focus from making money to managing risk. You'll see a massive change in the results you get.


If you can't decide, the answer is No.


You can win for 200 days, but still lose everything in 1 day.
Risk management is a trader's best defense.


4 hours per day:
2 hours of studying price action
1 hour of backtesting your system
1 hour of improving your edge
In 12 months, you'll be a different trader


When taking a loss, most people's first instinct is to get back the money lost at all costs.
Which often makes things worse.
Shift your perspective from money-oriented to process-oriented.


If you want to be the best, prepare to be alone. Because there can only be one.


You must assume that it's not only possible but probable that you might actually be wrong. If not, you can't set proper risk thresholds and protect yourself.


Trading is a waiting game.
Stop forcing trades. Learn to wait for your setups.
A trader who can't wait is not a successful trader.



Shrink your focus. Narrow down to 1-2 setups in specific market environments and stay right there. Ignore, mute, block anything outside that focus and become really good at one thing. You will trade less, make more and be way happier not chasing all the shiny objects.


I'm an introvert.
And one of the reasons why I became a trader is that, unlike most professions in life, you can do it completely alone.
Success or failure depends entirely on you.


You can never be the best trader in the world. You can only be the best in the world at trading your own strategy/system.


Trading is not rocket science.
  1. Edge
  2. Risk management
  3. Emotion control / Execution
Don't overcomplicate things.


Trading is the biggest battle against your mind.
You face fear, greed, anger, sadness on a daily basis.
But if you can overcome it, you can do anything.


Capital protection before reward generation.
This is the name of the game - something that took me way too long to grasp.


Most success is built on a foundation of past failure.


Don't be afraid to disappear while you build trading skills and become a fearless successful trader.


The best traders stick to their approach.
And they fully understand and accept that they will have periods of underperformance.
Because no approach will work all the time.


They call you gambler if you lose money for 3-4 years.
They ask you how you did it if you earn more than their annual salary in 1 month.
Trading is powerful.


Stop breaking rules. Stop fearing of missing out. Stop trying to catch every market's movement.
Focus 100% on executing your system.
Impatience is the #1 killer of your trading.


No amount of risk management or market edge will matter if your head is not in the right place.


I stopped blaming others (brokers, exchanges, talking heads, gurus, the cats) when I understood that I alone was responsible for my trading decisions and state of mind. And that's when the real progress began.


Here's the essence of risk management: Risk no more than you can afford to lose but also risk enough so that a win is meaningful. If there is no such amount, don't play.


In bear markets,
  • good news is bad news
  • bad news is bad news
  • no news is bad news
  • very bad news when the market is very oversold is good news


If your execution is bad, backtest more.
If your emotion control is bad, meditate more.
If your system is bad, practice more.
Don't waste your time doing nothing.


If you can't display an ounce of self-control when somebody cuts you off in traffic, while waiting in line at the grocery store, or even when it comes to your diet, then how do you expect to display self-control in the market?


No trader, who ever succeeded, did so because they learned to beat the market. They did so because they learned to beat themselves.
Only when you learn to do that, will you consistently be able to beat the market.


Just so you know, you're going to have to take a lot of losses on your way to success.
So, you better start getting used to them.


The more you trade, the more you realize that the hard part is being patient, disciplined, overcoming failures, and executing over 5-10 years.


Trading offers you a chance to make asymmetric bets with a decent probability of success ― unlike lotteries or other games of chance. Why people still fail to make any money at all is purely because of their lack of discipline.


One of the most suicidal things you can do in trading is to keep adding to a losing position.


A trading edge puts you in the top 20%.
Risk management puts you in the top 10%.
Emotional control puts you in the top 1%.


Finding a good setup is only a small part of the work.
Staying calm while you are executing the good setup is the real hard part.
That's why trading success is 99% execution.


How long it takes to be profitable in trading or investing depends on the quality and speed of your research to create a quantified system with an edge. After that, the discipline of execution along with the right market environment leads to profitability.


Traders must resist the need for action. It's the most difficult thing to overcome. You have to change your view at the market. It's not a place for being busy or action, it's a place for following a process which produces money as an outcome. Work on that every day.


You have to develop the ability to be content with not doing anything, sometimes for extended periods. The market won't hand you an A+ setup every day. Can you sit on your hands and pounce only when the stars are fully aligned? Most traders can't - they compulsively seek action.


Losses are part of this business.
Do not allow yourself to become bitter because of them.
Maintain that spark in your eyes.
Manage your risk, keep trading, keep learning, and keep growing.


It's not the mathematical skill that's critical to winning; it's the discipline of being able to stick to the system.


Profitable traders are specialists.
They pick one set up, one market, one strategy, and go tunnel-vision on them.


You don’t need to trade 5 times a day (or even a week) to make it as a trader. Wait for the high probability, high quality setups only. Limit/eliminate boredom trades. Results will take care of itself.


If you want to be wealthy, spend your time earning, learning, or relaxing. Outsource or ignore everything else.


If emotions rule your trading
  1. Reduce your size
  2. See how this naturally lowers pressure and stress
  3. Keep trading while learning to work with that reduced emotivity
  4. Only increase your size when you're more confident and secure in the face of losses


You'll be much happier when you realize that you are going to have losses and that they'll come unexpectedly. When losses are no longer distressful, you'll start trading at a higher level.


I was always ready to share, but before external success, nobody cared to listen.


The best traders trade by finding a niche that fits them and then becoming an expert in that niche.


Your mistakes, struggles, failures, late nights, early mornings and emotional breakdowns are part of your trading experience.


You don't get rich by spending your time to save money.
You get rich by saving your time to make money.


The real battle is not on the charts.
It's in your mind.


People who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences. Calamitous drops do not scare them out of the game.


A trading edge makes you a good trader.
Risk management makes you a great trader.
Emotional control makes you a legendary trader.


Once you find your system, you wait patiently for your setups and execute without hesitation. Live with the results and what brought you success in the past. Rinse and repeat.


No matter how much it hurts now, someday you'll look back and realize that the struggles and pain were all a necessary part of the journey to the top.


Every successful trader felt lonely.
Every successful trader had bad moments.
Every successful trader thought of giving up.
They just didn't.


You don't need to build a billion dollar startup to be successful you know.
If you're happy, able to pay your bills, you've basically won the game.
Don't let anyone tell you otherwise.


I really don't care about the mistake I made three seconds ago in the market. What I care about is what I am going to do from the next moment on. I try to avoid any emotional attachment to a market.


Trading is mostly about patience, not continuous action.
I execute my swing trading system in about 30 minutes a day. Only a few minutes of that is entering and exiting.
The rest of the trading day is just the risk of breaking my rules.


The first step of every successful trader: Failure.


Take your losses.
Don't recoil.
Allow yourself the experience both the ups and downs of trading.
You will have to lose hundreds of trades before becoming a good trader.


If you can sleep for 7 hours without waking up in between, run a 5 km in 35 minutes, 20 push-ups in 30 seconds, climb 10 floors without panting, then things are going good for you, you are in total control of your life. Remember "If health is lost, everything is lost."


A good trade has less to do with the immediate outcome and more to do with the thought process behind it.


Trading is not a game of intelligence.
It's a game of persistence, confidence, discipline, patience.
It's a psychology game, not an IQ game.


Without discipline, you'll remain a slave to your impulses.
Every time you exert discipline, you are improving your capacity to become free.


Successful traders have the simplest trading systems.
The difference is their experience and execution level.


Strive for excellence, not perfection.
In an uncertain environment, the pursuit of perfection is downright unproductive.


A trading mistake costs you money.
A trading lesson learned brings that money back 100x


What you can't accept, comes to bite you.
What you accept, ceases to bother you.


I'm always thinking about losing money as opposed to making money. Don't focus on making money, focus on protecting what you have.


If you're on your phone or computer 24/7, watching every market move, every little change in your PnL, every influencer's hot takes, eventually you'll burn out. You're making this way harder than it needs to be just because you wish to control a process you don't even control.


If you're a greedy trader, start following your rules.
If you're an anxious trader, start reducing your risk.
If you're a scared trader, start thinking in probabilities.
If you're an angry trader, focus on the next opportunity.


Trade only if you have an edge. Stay out of the market, stop trading and wait until your edge comes back. You don't have to make money all the time. Traders are not paid by the hours they work! They are paid by making the right decisions.


Most traders lose because they change their trading system every month.
Few traders win because they focus on one trading system for life.


All your trading plans are 100% useless if you break rules all the time.


When you trade for money, you'll quit at the first failure.
When you trade because you love it, you'll do it forever.


Trading teaches you isolation. Because no one will understand your feelings during the process to become a successful trader.


When in doubt, get out and get a good night's sleep. I've done that lots of times and the next day everything was clear. While you are in the position, you can't think. When you get out, then you can think clearly again.


If a stock is a true market leader, you want to see this behavior:
  • 10% upmove in the general stock market: Stock is up 50%
  • 5% correction in the general stock market: Stock is flat.
The strongest stocks outperform the general stock market up and down.


Making money from stocks look deceptively easy. The reality is that stock market is one of the toughest mental games in the world.


Develop the awareness to notice when your emotions are telling you to do something that you know you'll regret. And have the maturity to say "No, I won't do it."


Stop obsessing over the ups and downs of the PnL.
Release your attachment to short-term outcomes.
Trust the process.


Letting your profits run is uncomfortable.
It reveals your fears.
But, you gotta push yourself to stay with it.
It's the only way to truly know what you're capable of and, along the way, forge your self-confidence.


Every failure you go through in the market brings you closer to success. Because when you fail, you're not starting from scratch, you're starting from experience. And you're learning how to survive and thrive.


Be patient with your process.
Be patient with the market.
And perhaps above all, be patient with yourself.
This game is all patience.


If you want to win, you need discipline.
If you want to win big, you need confidence.
If you want to win the game, you need consistency.


The difference between top traders and everyone else is discipline. Top traders operate from discipline rather than feelings. They do what they must do regardless of how they feel.


Paradoxically, you trade better when you stop thinking about money.


Trading's downsides:
  1. Loneliness
  2. Emotional pain
  3. Long time to overcome the learning curve
If you can endure these nothing can stop your success.


Trading is very long term stressful. So if you're planning on doing this for a long time, pace yourself. We carry our stress with us as it accumulates and at some point our mind, body, and spirit will push back. So it is essential to build in recovery time along the way.


Here's a paradox many traders will experience at some point. The more skillful they get, the less attractive money becomes. Success is no longer defined by profits, but by how well they, as traders, perform.


It's not whether or not the market is "cheap", it's whether or not the risk of where you're wrong is cheap.


The solution to most trading psychology problems is simply to just trade smaller. Find your position size comfort zone.


If you start every trade with a small position size, everything become much easier. Large position sizes create stress and pressure. Only have large position sizes if the trade is going into your preferred direction.


If you're afraid of losing money, reduce your risk.
If you're afraid of risk, think in probabilities.
If you're afraid of missing out, backtest your system more.
Fear is just an illusion.


Happiness is the state when nothing is missing. When nothing is missing, your mind shuts down and stops running into the past or future to regret something or to plan something.


If you are relentless in your pursuit, you will either get what you want, or you will die. The ability to never stop, with no additional traits, is hard to top. Being unreasonable in a world that asks you to bend the knee to its inferior reality.


Real happiness only comes as a side-effect of peace. Most of it is going to come from acceptance, not from changing your external environment.


The measure of how much you love something is what you sacrifice for it.


Trading is one of the most difficult, but rewarding skills to learn. Do not give up, you are so close to succeeding.


You start thinking trading is becoming a millionaire in one year.
You end up fighting against yourself every day.


Despite knowing that there's no magic system, secret formula, or special indicator that leads to trading success, I still spent many years as a trader, foolishly searching for them. Then after 13 years, I started working with a coach. This was the start of a dramatic change in my trading fortunes, that powered the next 10 years of my trading career. It was ironic, because I had probably known that the answer always lied within me, hence my fascination with psychology, self-improvement and personal growth. But knowing it and being able to access it, are two very different things. Working with a coach, whose method was rooted in psychotherapy, made a huge difference. It was not anything he said, or any special wisdom he departed, that made the difference, but rather how he worked with me, that led to a transformation. His coaching caused me to reflect deeply, to find out who "I" really was, rather than the carefully crafted fantasy version of myself, formed by my ego, that had sustained me over my entire life.

It was the defense of this fantasy version of myself, that lied at the root of my trading problems. The ego wanted this version of me to win so much, possibly too much, that I ended up continually self-sabotaging. At a deeper level, my true self could not get behind this version of me, because it was not authentic. And thus, I sought easy solutions, simple wins, external answers. It was this that stopped me from taking the true risks I needed to take to win, it was this that sought impossible perfection, it was this that bottled it at the wrong time for fear of failure. It was this that would become gloriously overconfident, just at the wrong moment, or hesitated, just when hesitation was not needed.

There is only one version of you that can ever succeed. The true authentic version of you. This has power beyond your imagination. This version of you, when accessed, can do things, that you can't believe you'd be capable of doing. When you are working in ways, that are aligned to your true self, then that is something you can get behind.

Losing, or missing out, are no longer the existential threats they seem to be, instead they are just speed-bumps along the way, a part of the journey and not catastrophes of your own making. I now coach traders, much like that coach, coached me. I meet some fantastically successful people and traders. In fact, it would be fair to say, that I am far more likely to be approached by successful traders, than unsuccessful ones. They know the value of continually working on themselves.

One of the ironies I've noticed with these people, is that when I explore with them what makes them successful, they never mention, the system they use, a secret formula they were given or found, or a special indicator exclusive to them. Their success didn't, and doesn’t, come from outside, it always came from within.


To destroy greed, start following your rules.

To destroy anxiety, start reducing your risk.

To destroy fear of losing, start thinking in probabilities.

To destroy anger, start focusing on the next opportunity.

Your trading is as good as your mindset.


Best combination ever:
  • A trading edge
  • Risk management
  • A disciplined mind


A lesson is repeated until learned.


Everyone wants to do whatever it takes to have an edge as a trader. But I always ask them: "Can you not trade for a week or even a day?"


Half of all traders are dopamine addicts with no willpower. They need their daily fix of "trading," and it doesn’t have to be pretty.


1 trading system

Risk management

Self-discipline + Execution

100% focus on these.

You will thank yourself in 6-12 months.


If you're not successful yet, Saturday is the best day to improve yourself
  • Plan the next trades
  • Review your past trades
  • Review your trading system
Stop wasting your time.


Why do you keep breaking your trading rules?



They call you crazy, but you only face your emotions.

They call you a gambler, but you only take calculated risks.

They call you a workaholic, but you only work on your financial freedom.

Keep going.


The gap between where you are and where you want to be is called discipline, focus, and consistency.


The challenge isn't learning how to correctly time the market or stocks... that's the easy part. The challenge is learning how to get your emotions and idiosyncrasies out of the way of your potential.


Each day, set a time limit for trading.

If you don't see anything during that window, don't trade.

Don't squint your eyes and try to find reasons to trade.

Take the day off. Do something meaningful with your life.

And come back again the next day.


Meditation is intermittent fasting for the mind. Too much sugar leads to a heavy body, and too many distractions lead to a heavy mind. Time spent undistracted and alone, in self-examination, journaling, meditation, takes us from mentally fat to fit.


Sticking with my trading systems is all that matters to me. And the only times a trading loss upsets me is when I failed to uphold that principle.


The job of a trading signal is to create an edge with a high probability setup. It also removes your ego, emotions, and opinions from the process.


When you realize that the solution to trading's conundrum is in your mind, you will stop the holy grail chase and redirect your focus towards bettering your trading psychology.


Trading success is built on mistakes. Hundreds of them.


In trading, consistency isn't about making money.

It's about consistently executing your edge.

Money is just a by-product.


How to stay disciplined as a trader
  • Have clear trading rules in front of your eyes
  • Track success / failure of the trading process execution
  • Focus on your long-term goal and avoid short-term focus
  • Do a self-analysis every week to find improvements


In trading you have to learn to manage yourself first (emotions, learning, mindset, time). Everybody can learn the technicals, but only a few people are continuously working on managing themselves.


When a 20 year veteran trader, and one of the most successful traders out there, says;

"I'm still making the same f-cking stupid mistakes I did when I started."

You realize, it's not just you, this remains forever, a hugely challenging job.


Don't stop.

The amount of losses, mistakes and failures can really mess up your brain.

Find a successful system. And then become a trading machine.

Never look back.


Knowing how little you matter is very important for your own mental health and happiness.


For some traders, the discipline and patience to do nothing when the environment is unfavorable or opportunities are lacking is a crucial element in their success.


The best traders are "one trick ponies". They master one style or one setup and that's enough to make money. They noticed how important focus is and are not interested in changing their approach. That's what you want to achieve as a trader!


If you're going through hell, keep going.


Trading changes your life.

The more you trade, the more you realize emotion control is power.

If you can control your emotions, you can do anything.


You can't expect to change and expect your friends to stay the same.


Stop focusing on money. Focus on risk, execution, following your rules, consistency. Money will follow.


Success is a test of will to see how long you will stick with what you said you would do. How long you refuse any outcome that was not the thing you wanted to happen.


The game taught me the game! That means: Practice is the best teacher. You cannot learn trading out of a book or in a video course. Trading is 99% practice!


Psychology fact: When you increase your risk, you will smash your confidence. That's why greed and revenge trading kill traders.


For years I've known who I am as a trader. I'm not a hedge fund, tv personality, analyst. I know the risk to my account. I trade within that risk. Many traders trade like their inner stock star and wonder what went wrong. I am a self-funded, self-directed, retail trader.


The only thing keeping me from burning out lately has been winning. I haven’t thought about truly enjoying life until recently. Most of the 7-year journey in the stock market was a living hell & constant grind as I fought through countless failures with no sign of hope.


Ever since I understood that I wasn't getting anywhere in trading because of my psychology, I developed this unquenching thirst for expansion and growth.

And that was key.

Trading really does change you if you stay with it long enough.


The smarter you get, the slower you read.


Failure was a key element to my life's journey.


The more confident, secure, and wiser you become, the less you feel the need to show off your successes.


The whole game is about knowing your limitations, being aware of your strengths, knowing where your edge is, cultivating that edge, learning to monetize it. Not easy, but many do succeed, with deliberate effort, persistence, commitment to self-learning & continual improvement.


Trading is the art of taking calculated risks to compound your money like no other business in the world.


Most people overestimate how well other people are doing and underestimate how well they're doing.


I need to calm down and remember that people that want to stay in my life will make that effort to do so. People that leave my life will no longer have access to me and that’s okay. I can't please everyone, and not everyone will understand me fully and that's okay.


You're going to die one day, and none of this is going to matter. So enjoy yourself. Do something positive. Project some love. Make someone happy. Laugh a little bit. Appreciate the moment. And do your work.


Please chase your dreams so when you're older you can say "oh well I tried" rather than "what if" because regret is heavier than fear of failure.


If you aren't curious about it, you'll never be good at it.


In this field, you earn more by doing less. And very simply, you do less by systemizing your trading process.


If you don't build self-discipline, you will always be a slave of your emotions. Trading is 90% psychology.


Ultimately, if you're curious about something, you will be successful at it.


The person who risks nothing does nothing, has nothing, is nothing, and becomes nothing. He may avoid suffering and sorrow, but he simply cannot learn and feel and change and grow and love and live.


Your mental health matters more than your trading account health.


Trading, at the end of the day, is simply a mind game.

This means that you must get good at controlling yourself and your destructive patterns of behavior.

Also then will the market begin to reward you.


The mental strength you develop to become a successful trader will completely change your non-trading life.


A common mistake is breaking your rules for a quick profit or because you think you can't lose. Indiscipline kills traders’ careers.


Very headline / rumor driven market requires hyper vigilant risk management. You are a risk manager first - you are a trader only when your obligation as a risk manager is fulfilled.


Don't feel bad for missing a trade.

There's always another opportunity.

Be a sniper, not a machine gunner.


You could do everything right and still lose money.

Trading is all probability.

The sooner you accept this, the better.


Trading maturity is when you realize the real enemy is yourself.


Trading is like climbing a mountain for the first 5 years to enjoy the view for the rest of your life.


Health, Love, and your Mission, in that order. Nothing else matters.


One of the hardest things for traders to accept is reducing their trade size to focus on perfecting their execution skills. Sometimes, you have to step back to better leap forward.


The worst outcome, if you fail at trading, is that you'll have to save up again and/or go back to a regular job.

The best outcome if you succeed is that you'll get to design the life of your dreams.

It's an excellent asymmetric bet if you ask me.

Fair downside; massive upside.


Every successful trader felt lonely, had bad moments, thought of giving up. They just didn't.


Be obsessed with process and improvement, not results.


Real trading starts once you realize it's not predicting the future, but it's a probability game.


Successful traders have the simplest trading systems. The difference is their experience and execution level.


Year 1: You trade your emotions instead of trading your system.

Year 5: You trade your system instead of trading your emotions.

When you understand it's a psychology business, your trading will change completely.


Trading is tough.
Often you don't have time to think and your emotions take over.

But once you learn to stay calm when you execute, you'll become unstoppable.

Break your limits.


Focus 100% on your edge. NEVER break your rules. Develop confidence. Aim for consistency.

There's still so much time to change your trading.

Just do it.


A trader who is addicted to repetition is a disciplined trader.


Be extremely patient in waiting for your trading edge.

Be extremely fearless in executing your trading edge.


Confidence is the best trading skill:
  • Fearless execution
  • Unlimited potential
  • No negative emotions
A confident trader, with an edge, has no competition.


Trading is your work. Many traders try to win the game without self-discipline, strategy, vision, patience, consistency. It's a business, not an hobby.


A gentle reminder. Try to step away from your phone or computer during the weekend. Do something meaningful with the people you love. Don't let the market consume all your attention and life. It will do that to you if you don't set your boundaries.


You should have only a few trading rules and they should be easy to abide by. Or else, you'll just struggle to generate consistency. Dumb down your trading process. Focus on simplicity.


Treat trading like a business, and expect uncertainty, loss, and stress. When trading is approached as a job, one tends to expect a regular paycheck. But the market doesn't hand paychecks, it delivers rewards and bonuses to those that are proficient at strategic risk-taking.


Your equity curve is a mirror of your psyche.


Winning makes you feel invincible. Losing makes you doubt yourself. Failing makes you want to give up. Your mindset is your weapon to succeed, not your reason to fail.


Risk management in trading determines who survives.


Make rest, recovery, and self-care your top priority. When you do,
  • You look better
  • You feel better
  • You think better
  • You trade better


Trading is brutal.

The amount of losses, emotional pain and emotional fights can really mess up your mind.

Find a successful system. And then become a machine.

Never look back.


Don't trade when your mindset isn't optimal.

Unless you're 100% sure that you will Not F**K up.

Mental edge and market edge go hand in hand—it's okay to take the day off if you're not feeling it.

That's what trading is - it's having the wisdom to say "No, not today."


Place your trade. Maybe it'll work, maybe it won't, but you'll never know until it happens. Be fearless in the face of uncertainty... this is your ticket to success.


The most difficult part of becoming a successful trader is not making money, it's learning how to change your mindset.


Nobody cares about your story until you win, so win.


Trading is 90% waiting for your setups and 10% pulling the trigger. A trader who can't wait is not a successful trader.


99% of your trading mistakes can be solved by following your rules.


Your goal as a trader is to protect your money first. Only when you've learned to protect your money can you then start to grow that money.


Every day has 100s trading opportunities. You just need only 1-2. Less is more is real in trading.


Life truly is a single-player game. Nobody stays by your side forever.


Trading is knowing what gives you an edge and staying laser-focused on that. The rest is just waiting. Waiting is 80% of the job.


Know yourself - your temperament and stress point. And don't trade a position size that you can't handle psychologically. This is key.


The more you trade, the more you realize that trading is a war of patience.


Trading is like magic. Money, skills and experience grow exponentially. You just need to be patient.


Saying "no" in trading is very important:
  • No to setups which do not meet your criteria
  • No to overtrading
  • No to spontaneous trades
  • No to trading ideas from other traders
  • No to fancy trading products or software


Simplify your trading.
  • Trade your edge
  • Win / Lose
  • Repeat
The ability to trade like a robot is the highest form of discipline.


Confidence destroys fear.

Discipline destroys breaking rules.

Consistency destroys impatience.

Developing your skills is the best trading investment.


Trading is being alone with yourself.

If you can overcome a situation when you're alone...

You'll become a fearless and self-disciplined person.

Not just in trading, also in life.


The most important conversation you will ever have in your life is the one you have with yourself. Don't underestimate the importance of self-talk, visualization, and maintaining strong mental toughness.


You can't control having emotions in trading, they will arise. The key is to control your reactions to your impulses to manage them through awareness.


Patience boosts your execution.

Patience cuts your mistakes.

Patience helps you controlling your emotions.

Patience is the most important trading skill.


If you're not successful yet, use free time to get more work done. Make plans, study, practice, review your trades, invest in yourself. Just step up.


No one becomes a successful trader without learning how to wait for your trades.


If you can't develop patience, you will never control your trading emotions.


Swing trading = Huge patience + detailed plans

Scalping = Fast execution + great flexibility

Day trading = Mixed

Find your style, build your success.


Do not anticipate and move without market confirmation - being a little late in your trade is your insurance that you are right or wrong.


Patience and discipline create wealth. Ego and arrogance destroy wealth.


The amount of money I have lost trying to make something happen under the guise of "I'm a trader, so I trade" is astronomical. The vast bulk of my big profits have come from "obvious" trades. You don't find trades, trades find you. You just have to be available to take them.


Trading killers:
  • Fear
  • Greed
  • Anger
  • Impatience
Destroy them with discipline and consistency. Trade. Win/Lose. Repeat.


Trading is a dream job for an introvert.


Most of us fail in life because we're too worried about what other people think. Stop giving a shit about that and be unapologetic for living the life YOU want to live. The less you care about what others think, the easier your life will become.


If you want to become a successful trader, but you are not:
  • Developing a profitable system
  • Taking care of your risk
  • Building trading skills (confidence, patience, etc.)
It's time to change your mindset.


After years of experience you get a very good feeling for the market (intuition). You experienced so many similar situations and patterns that you literally "feel" the market. Don't ignore that. It's a huge gift and helps a lot.


No one is coming to save you.

Your execution, your plans, your risk, your systems... everything depends on you.

That's why most traders fail.


Remember, it doesn’t matter what people think of you. Only validation you need is from yourself. Embrace failure & feed off your progress. We all start at zero and our goal is to take more steps forward than backwards. You will eventually go into a full sprint. Money will follow.


Trading is difficult. You spend 1-2-3 years looking for the perfect trading system, until you realize you have to work on your mindset. It's not easy to start again from 0.


Trading success hits different when no one believed in you.


If you stay patient and disciplined, the market will reward you. Draw up your plan, set your trap and wait for confirmation. Do not try to predict and jump in early.


Bad trading results teach patience.


If you want to trade stocks, you need a market filter or market model, so that you always trade in the right direction. 80% of all stocks follow the general market trend. If you trade against it, the probabilities are very low to make money.


Discipline is the ability of executing your system like a robot.

Confidence is the ability of executing your system without anyone validation.

Patience is the ability of waiting for your targets like a sniper.

Your trading mindset is your most powerful asset.


Loneliness and mental control affect your trading.

First they are your weakness, but then they become your strength.

Learning to be alone will make you unstoppable.


Lack of success made me hungry. Achieving success made me lazy. Losing success made me smarter. Getting my success back made me hungry to sustain it and never give it back again.


Society gives more attention and value to the illusion of happiness. And it's unfortunate because it pressures people to chase all the wrong things.


If you can't stay calm when price goes against you, you have a confidence problem.


Only to the extent that you've allowed yourself to feel your pain fully, without looking away, without gritting your teeth, can the process of healing begin. Familiarity breeds indifference. Pain must completely consume the old you before the new you can emerge from the ashes.


When I'm making good money it's because the rhythm in my execution is good, less about my strategy hitting levels on point. Self-awareness of being in a good rhythm is one of the best assets you have.


No more all-in trades. Stop taking stupid risks after a trading loss. Revenge trading kills traders’ careers.


Trading is a long run. 1 bad day is enough to destroy everything. Survive. Get better. Get successful.


The most dangerous mistake is breaking your trading rules.


The minute you think you've found the key to trading, I promise you the markets will change the lock.


Trading is your work. Show up, plan, execute, record mistakes, get feedback, improve, execute again. It's a business, not a hobby.


Most traders are afraid of trading. Successful trading is probability + execution + confidence + infinite repetition. If you're afraid, you will lose.


Make consistency (not profits) your number one priority.


Those who can follow their trading system without being led astray by their ego or emotions find success.


If you're not performing well in the market, it's important to know where it stems from. I always ask myself these 3 questions: Is it me? Is it the market environment? Is it my strategy? Getting to the root of your struggles requires an honest look inside yourself to fix it.


Outstanding long-term results are produced primarily by avoiding dumb decisions, rather than by making brilliant ones.


How To Bounce Back After a Big Trading Loss

A lapse in discipline, or just a sustained bleed-out of trading capital, nearly every trader will face a big loss in their career. How to bounce back after a big loss isn't complex. What is difficult is repairing the mental damage done, especially the damage to confidence. The level of confidence, where you see the market for what it is, step in whenever there's an opportunity, cut your losses when it doesn't turn out, and sit on your hands when conditions aren't right, is the confidence that can be lost after a losing streak. You may begin to question yourself, which leads to all the typical problems, like getting out of trades too quickly, holding on to them too long, skipping trades with the fear of losing, or getting into more trades than you should in an attempt to get some winning trades.

The Day of Your Loss

Every trader has bad days. As a rule, never let a bad day cost you more than you make on an average profitable day. If you average $700 on your winning days, don't lose much more than that on a bad day. Control the downside. A big loss causes all sorts of inner conflict - revenge, fear, anger, frustration, self-hate, the list goes on. After a big loss, there's no way to trade with a clear head. 250 trading days in a year, there is no rush to get back in there; today is not the day to make it all back.

Accept Responsibility

Maybe it was just a bad few days, maybe it was your biggest single loss ever, or maybe it's a life-altering loss. In the case of facing financial ruin, there isn't much to do. Don't trade until the issue is resolved. Once it is, then you can proceed to the steps below, but not before. Don't trade with a massive debt over your head with intentions of using it to abolish that debt; that's a lot of pressure and could lead to a worse predicament. There is always an excuse for a losing trade. Some are actually good excuses, but as traders, we ultimately must accept all the risks. Until we accept that we are responsible for whatever happens with our orders, history will likely repeat, and the same thing will happen again. Accept responsibility, and figure out what could have been done differently. That will help reduce the chance of it occurring again. It is also healthier than bottling up hostility and blaming others for your misfortunes. Blaming others is admitting that you don't control your own trading, and if that is the case, why are you trading? If you control your trading, then you can fix it; if others control your trading, you can't fix anything. There is always something that can be done. It may involve changing markets, having backup data connections, or having stop-losses and targets automatically sent out when a trade is entered, or maybe you set up your platform to liquidate your trades if you hit a daily SL limit. Most likely it’s because you aren’t sticking to your rules and are sizing to big. The solution is there; you just need to find it. The best way to find it is to admit that the loss resulted from not handling something well, and then taking steps to fix it. Fixing the particular issue that caused the loss is step one. There's still the issue of confidence, though. Even with the issue fixed, your confidence may be low after taking a big hit.

Realign Your Focus

When you started, you were likely overconfident, but then the market put you in your place. You developed healthy confidence over time by building your trading system, testing and practicing it, and then ultimately utilizing it for successful real-money trading. After a big loss, get back to basics. Focus on the trading plan (with any adjustments made to it) and your implementation of it. Get back to what attracted you to trading in the first place: building or learning a strategy that made money consistently. Trading is hard, so get back to loving and embracing the challenge. A string of good times can make us lazy, and often a big loss is the wake-up call. It's the market letting us know that we have drifted off course.

Practice and Rebuild Confidence

After a big loss, confidence can be low. That means the mind may not be right for trading. Not having a clear mind can cause you to skip trades, panic out of trades (trading not to lose), or be overly aggressive to get back to your old winnings. None of these is good. Take a step back, trade in a demo account for a few days. If you have been losing, you will likely save yourself money. Because it's not real money, there is also less pressure, so it's easier to focus on trading, and not worry about the financial aspect.

Start Small

A few winning days in the demo account will raise your confidence levels and put you in a better mental space to take on the markets again with real money. After a losing streak, start small; don't jump right back to the same position size you were trading before. On the first day back, trade a small position size. A winning day with a small position size will help build confidence. If you have a losing day, losing on small position sizes is easier to handle than another losing day on full position sizes. Get back into live trading at a slow pace. If you're feeling really beaten up, spend at least two to five days in simulation, and when you switch back to live trading, start small and increase position size when you have winning days. Even if you win a few days in a row, increase your position size incrementally, so it takes time to get back to your full position size. Some try to rush back into live trading after a big loss, when they aren't ready. They end up losing more. Some traders repeat this cycle forever. After you have traded bigger position sizes, it's annoying to start back with a small position size, but it's for the best. Bouncing back from a losing streak is about getting back to basics and implementing a strategy well, not about making money. Money comes from the strategy.


After 3-4-5 years you realize the real battle's always been you vs you.


A balanced life outside of the market helps put setbacks in trading into perspective.


Trading mistakes are temporary. Lessons learned that save you money in the future you stay with you forever.


From 0 to trading success:
  • Practice/Study like no one else
  • Find a trading edge
  • Focus 100% on your trading edge
  • Execute it for the next 5 years
Nothing can stop you.


Not all traders are introverts, and definitely not all introverts are traders, but there's a lot of overlap, I would say. Trading can be a lonely profession, and money aside, it appeals more to those that work well on their own.


Every successful trader had losses.

Every successful trader made mistakes.

Every successful trader had failures.

They just didn't give up.


When the trend is up, people try to short it and get caught. When the trend is down, people try to play the bounce and get caught. Why don't we simply go with the established trend?


Trading is a slow process...
  • Time will make you gain skills
  • Experience will make you know yourself
  • Mistakes will make you a better trader
Trading is a process of self-discovery.


It's impossible to become a successful trader if you never follow your trading rules.


The way to consistency is through a disciplined mind and a well-crafted trading process.


Greed destroys traders.

Stop focusing on money. Focus only on execution and risk.

That's when greed goes away.


Trading is the most individual business.

In front of your computer there is only you and yourself.

You are your own competition.


Analyze your trading & mistake. That's the number one source to learn and optimize. You will improve after some years of making mistakes, analyze them and find new rules or optimizations. Traders are not born; they develop over time.


It is literally impossible to build long-term, enduring market success based on sloppy, whimsical risk procedures. Rigid risk control is at the heart of any viable trading strategy or system.


Mistakes and failures are temporary. Skills and experience stay with you forever.


It's not that markets are unpredictable, it's just that they're uncertain. And because of that uncertainty, risk management is paramount. If you don't learn to manage risk in an almost military-like way, you're toast—sooner or later, you'll reap an account-decimating loss.


To let go of something, you must allow yourself to ponder it and to feel it fully before you can move on.


Trading is hard:
  • The battle is against yourself
  • Fear, greed and anger steal your money
  • No one will come to save you
That's why most traders give up.


There is certainty in the embrace of uncertainty.


Being consistent as a trader means:
  • Stick to your rules every day, week, month and year
  • Don't get distracted by other people
  • Ignore trades which do not meet your criteria
  • Having confidence in your approach
  • Doing the same trades over and over again


Confidence in trading isn't taking a trade thinking you're smarter than everyone. It's knowing your edge and staying disciplined.


Be patient in waiting for your trading edge. Be ruthless in executing your trading edge.


Most people think trading is fighting against the market. It is actually fighting against your own emotions 90% of the time.


It's ok to work hard on something most people don't understand. If you want to be the 1%, you can't expect to be understood by the 99%.


You can't make money agreeing with the consensus view, which is already embedded in the price. Yet whenever you're betting against the consensus, there's a significant probability you're going to be wrong, so you have to be humble.


Every successful trader is a product of 5-10 years of hard work, failure and experience.


Just stop.

Stop breaking rules. Stop fearing of missing out. Stop trying to catch every market's movement.

Focus 100% on executing your system.

Impatience is the #1 killer of your trading.


Work so hard until your friends and parents start calling you lucky.


Often times what gets traders in trouble is they get bored waiting for the next series of high quality/high probability setups and start to take trades that they normally wouldn't take just to satisfy that urge to trade simply for the sake of trading.


The difference between a trader that survives vs one that eventually disappears is that one has patience, discipline, and humility. They know their strengths & weakness. They remain in control. The other gets lucky every now and then before going back to working the 9 to 5.


Always ask yourself would I enter a full position right now? If the answer is no, then you wait for things to set up again. Always another trade if you wait.


When you reap a loss or a series of losses, maybe take a break. Step away from the market instead of trying to force things to happen. Come back the next day with a fresh mind... instead of allowing frustration to build up.


A simple question you can ask yourself that often changes behavior: Is what I'm about to do a step toward or away from what's important?


The greatest lesson I have learned over the years as a trader is simply this: Trade when it is easy. Don't trade when it is hard. When I insist on trading when it is hard, it's because I am needy, insecure, demanding affirmation, not content, eager to prove, bored, scared, or angry.


Don't let temporary setbacks deter you from the bigger picture. Stick with strong risk management guidelines and don't blow up. That's the best thing you can do when the market hands you lemons.


Accepting uncertainty (the possibility of reaping a loss) is arguably the toughest aspect of this game. If you don't come to terms with it, your trading is going to be influenced by moods and emotions to a considerable degree.


Trading is a journey into a world of uncertainty, insecurity and imperfection. If you haven't got your own back on that journey, it doesn't matter how smart you are, or how good your system or strategy is, you'll always struggle to reach the potential you feel you have.


How long it takes to be profitable in trading or investing depends on the quality and speed of your research to create a quantified system with an edge. After that, the discipline of execution along with the right market environment leads to profitability.


Trading requires you to be in optimal states of equilibrium (in the zone) to be able to make appropriate choices in volatile random environments that can knock you completely out of whack (disequilibrium). Self-management is vital if you're serious about winning this game.


The reality is life is a single-player game. You're born alone. You're going to die alone. All of your interpretations are alone. All your memories are alone. You're gone in three generations and nobody cares. Before you showed up, nobody cared. It's all single-player.


The most successful traders made their money in bull markets. They stay away from bear markets, because the volatility is too high and the profit opportunity limited. If you go short, you can make 100% at maximum – if you go long, your profits are not limited.


Reading a book isn't a race - the better the book, the slower it should be absorbed.


The acceptance of uncertainty is a key quality to be developed. When you flow with uncertainty, you're not resisting it; so, there's no conflict, no fear. Teachers, mentors, coaches can show the way, but all in all it's largely a personal journey that you yourself must undergo.


Pain + Reflection = Progress


It's hard to reap loss after loss. It's as if the market is pulling the rug out from under you again and again. But you must remain patient and not allow the market to get under your skin. Market edge means nothing without mental edge.


Embracing the philosophy that there are no losses in life, only lessons, will take some of the sting out of trading losses.


Trading is being alone with yourself.

If you can overcome a situation when you're alone...

You'll become a fearless and self-disciplined person.

Not just in trading, also in life.


They call you crazy when you start trading. They call you lucky after 5 years of building skills and compounding money.


The belief (and acceptance) that the future is uncertain is one of the most fundamental components of becoming a successful trader - and it's probably the most difficult to learn.


If you're in a drawdown, know that the situation will resolve itself.

But until that happens, you've to last, you've to survive.

So, remain stern with your risk control, stay focused on your process, and think long-term.

Also, take care of yourself. Every moment. Every day.


Your position size will shape how you feel about the results of your trades.

If it's too big, you'll care too much.

If it's too small, you won't care enough.


The most powerful paradoxes of trading:
  • The less I trade the more money I make by avoiding trades taken from impatience and boredom with no edge.
  • All my biggest profits were made on option contracts I bought not ones I sold. Option contract asymmetry favors option buyers while winning percentage favors option sellers.
  • My number one job as a trader is to manage risks and keep the capital I already have not make money.
  • The best traders in history were the best risk managers not the best at entries and exits. The traders that survived to be the big winners were able to accept when they were wrong and exit a losing trade.
  • The ability to admit you're wrong about a trade & get out is more important than being confident in a winning trade & staying in no matter what. The risk of ruin is greatest when you have conviction about a trade & can't accept when you find yourself on the wrong side of a trend.
  • Winning traders think like a casino losing traders think like gamblers. What is the best way to make money in a casino? Own the casino. Casinos are profitable because they have a mathematical edge that plays out over the long term as long as they have table betting limits.
  • Opinions, projections, and predictions are worthless, trade the price action. Good trading systems can only take signals in the present moment. The future does not exist.
  • At times market fundamentals can be good filters for a trader but they are always terrible masters. Price trends where it wants regardless of fundamental valuations.
  • Only date your stocks but marry your risk management. Stocks are only good if they are going up.
  • The smaller and more focused my watch list the better I trade what is on my watch list because I know the backtested price action and the historical charts very well.


LCC Tax Benefits for Traders
  • Working as an independent trader can be a way for individuals to make extra income, or even possibly a full-time living. But like any business venture, the income generated from trading is taxable.
  • If you are successful as a day trader, it can create significant tax liabilities for you. Individuals that want to participate in the stocks have several options: they can trade as individuals or sole proprietors, qualify for trader status, or trade through a business entity.
  • For the active trader, creating a legal trading business will often provide the best tax treatment and asset protection.
  • Unless an individual can qualify for qualified trader status (as determined by the Internal Revenue Service (IRS)), all income they generate from trading activities is considered unearned or passive income when they file their individual income taxes.
  • f you cannot qualify for qualified trader status, another way to ensure you are receiving similar tax treatment (as compared to a qualified trader) is to create a separate corporate entity through which you will conduct your trading activities. Like an LLC.
  • Creating a separate corporate entity to trade through is the only way to ensure that you will receive the same tax treatment as a qualified trader. You can receive all the same tax treatment as a qualified trader without having to qualify by creating a LLC.
  • The IRS has an assumption that no one would go through the trouble and expense of forming the entity unless they were committed to trading as a business venture that's why the legal entity usually receives less scrutiny from the IRS.
  • Now lets go over the tax benefits of starting an LLC to trade now that we know starting an LLC can provide the same benefits as a qualified trader or someone who has Trader Tax Status (TTS).
  • A qualified trader is allowed to file a Schedule C form and deduct business expenses, which could include education, entertainment, margin interest, and other trading expenses. Qualified traders can also take a Section 179 deduction for equipment used in trading activities.
  • Writing off up to $19,000 a year for equipment used in trading activities on Section 179 deduction is also possible. Finally, a qualified trader can elect a Section 475(f) election (also called the mark-to-market (MTM) election). Lets talk about MTM election
  • Mark-to-market (MTM) accounting allows qualified traders to change their capital gains and losses to ordinary income and losses. Because gains and losses are regarded as ordinary income under MTM, all losses are deducted in the year they occur.
  • Under MTM, traders are not bound by the $3,000 net capital loss limitation; they can deduct all losses in the year they occur, providing the maximum tax relief in the current year.
  • Some traders will also elect MTM to avoid the 30-day wash sale rule, which disqualifies loss deductions on "substantially identical" securities bought within 30 days before or after a sale. The wash sale rule is where most traders mess up and end up owing taxes.


Don't marry a trade. Execute. Win or lose. Go on the next one. No regrets.


The measure of wealth is freedom.
The measure of health is lightness.
The measure of intellect is judgment.
The measure of wisdom is silence.
The measure of love is peace.


You don't make money, your process does, your commitment to your process does, your willingness to submit to the daily grind of your process does. Your belief in your process does. But YOU do not make money. Please don't make the mistake of thinking it is actually you.


In many ways, the stock market is like the weather in that if you don't like the current conditions, all you have to do is wait a while.


The "Rule of 16" options cheat code & how it works:

Rule: Divide an options implied volatility (IV) by 16 & you get an estimate for a 1-day stock move based on options prices

IV = 32%
32/16 = 2% = 1 day stock move
Why divide by 16?
IV is a 1 standard deviation (SD) estimate for stock range over 1 year
1 SD = a 68% probability that the stock price falls within the IV estimate over 1 year.

If a stock is $100 & IV = 20%
$100 * 20 = $20
There's a 68% chance the stock stays between $80 & $120

IV's are shown in 1 year (annualized) terms, even if the option expires in a month.

By using the rule of 16, you are translating that 1 year, 1 SD estimate to a 1 day estimate.

There are 365 days/year, only ~252 of those are trading days.

Traders generally exclude non-trading days from calculations, so they use ~252 trading days as a year

SQRT(252 days) = 15.87, which is rounded to 16 for simplicity

IV/SQRT(252) =
IV/16 = options implied 1 day stock move

Why use SQRT of time?

This results from models like black scholes estimating stock movement using a "random walk" process, which tells us volatility is proportional to the square root of time

Since IV is a 1 year unit, you have to therefore scale time using: SQRT(time)


They call you stupid when you start trading.

They envy you when in 1 month you earn more than their annual salary.

Trading changes relationships.


Trading is a game of statistical probability.

At the end of the day, strategy and behavioral consistency win—perhaps not individual battles but definitely the war.

So, win or lose, pat yourself on the back when you follow your trading plan.


The day you stop emphasizing each individual trade and learn to embrace uncertainty is the day your trading will change forever


The average trader has no emotion control.

When they are winning, they risk more.

When they are losing, they break rules.

It's not the system, it's the mindset.


Being rewarded for a mistake makes you unconsciously think that it's OK to do it again.

That's how the market traps you.

One of the worst things that can happen is when the market rewards you for breaking your rules.


You must identify an area on the chart where your expectation for your trade is invalidated.

You must accept that area as a point of failure and you must take your loss.

If you can't set proper risk thresholds and don't accept failure as a possibility, you can't be a trader.


Become so confident in your system that no one's opinion, trade or system can rock you.


In a volatile market, traders who use excess margin automatically begin to micro-manage their positions. Your setup(s) can be perfectly fine and eventually start to produce but by that time you already got shaken out and micro-managed your way into unforced errors (silly losses)


Ordinary men hate solitude. But the Master makes use of it, embracing his aloneness, realizing he is one with the whole universe.


Your mind is like this water, my friend. When it is agitated, it becomes difficult to see. But if you allow it to settle, the answer becomes clear.


Trusting your plan, getting into the habit of relaxing in the midst of uncertainty, learning not to panic - this is the path that leads to durable success in the market.


The older I get, the more I realize it's okay to live a life where nobody knows what you're up to.


Trading with a systematic edge is not gambling, it's a mental game based on probabilities of a proven method with a positive expectancy model and creating risk/reward ratios in your favor.

Gambling is just trying to be lucky with the odds against you.


Patience is created through Preparation. Patience is not something that can be forced, you will naturally have patience in trading if you trust your homework and know what you're looking for.


Trading a positive expectancy system means accepting controlled losses as part and parcel of the process.


A major ingredient in successful trading is self-knowledge.

If you don't take a hard look at yourself, you will keep giving your money to those that do.


5 core trading concepts you must understand:
  1. Hit-rate is not important to make money
  2. Position sizing has a big impact on trading success
  3. Simple & robust systems are more successful
  4. 80% of trading is psychology.
  5. Distance from markets will increase your success


If you approach the market as its student, whatever it hands you will be construed as valuable teaching moments.

If you approach the market as an arrogant know-it-all, those same lessons will be construed as attacks.

Drop your ego. Remain teachable.


Push the gas pedal when the going is good. The rest of the time, go fishing.


This is what is meant by trading price action. For each trade you must manage five things:
  • Entry: Your trade entry has to be based on a quantified signal that will put the odds in your favor of the price moving in the direction to make you profitable.
  • Stop loss: You must decide on the level that price should not go if the trade is going to work out in your favor. Your stop loss is the price level will you will accept that your trade is probably not going to work out and you are going to exit with a small loss.
  • Position size: Based on the volatility of what you're trading & the placement of your stop loss you must decide your trade size. Consider the total percentage of your trading capital you will put into your trade & how much you will lose if your stop loss is triggered.
  • Trailing stop: In winning trades you have to choose a trailing stop with price or a moving average that you will lock in profits if your winning trade reverses to that level. This is the way to maximize a winning trade by not exiting until you have a reason to.
  • Profit target: This is a predetermined level where you will lock in profits if your trade gets a specific price or technical level. This a way to minimize giving back paper profits when you are satisfied with a large enough profit.
  • Our success is based on how we manage our trades. How we control our emotions, maximize wins, and admit quickly when we are proven wrong about a trade.


Time and again, the market shows us that the control we believe we have is purely illusory.


Patience is the best skill you will acquire during your trading career. Nothing better than waiting for all of the noise to clear and execute your A+ setup with precision.

Rushed FOMO trades = blown accounts.


Losing in your first few years in the market is the normal process to big gains! For those struggling, this pain is necessary.


In my experience longevity in trading comes from learning how to quickly recover from your bad decisions that resulted in losses. We all make mistakes, but those that can mentally recover from them are the ones that reach the level of success they sought after.


You will repeat the same trading mistake until you learn how to master your emotions.


Real traders and investors are more passionate talking about what they have done wrong than what they have done right.


I've studied the greatest traders of all time for 20 years.

They all have 10 similarities:

  • Flexibility: they are open-minded to the fact that anything can happen. They aren't stubborn with losing trades if the reasons for being in them has changed.
  • Passion: They love trading, it is both their profession and game. It is like a sport to them that they enjoy winning.
  • They think in probabilities. Their language of trading is math. Risk/reward ratios and odds is how they see the markets.
  • They are market historians. They have studied the charts, macro, and economics of world history and understand what had happened in the past.
  • Confidence: The have faith in their method and faith in their self to execute it with disciple over time.
  • They ignore the noise and focus on what matters for their own strategy.
  • They don't ask others for their market opinions or future predictions.
  • They usually get in a trade a little late and get out of a trade a little early and make money on the majority of a move but not all of it.
  • They manage their position size and risk exposure to avoid the risk of ruin. They keep the money they make.
  • They focus their trading on high probability events, the path of least resistance, or the overall trend. They discount the obvious and bet on the unexpected.


Trading is not a game of making money. It is a game of not losing money. Making money takes care of itself over time. If you wait patiently and stack the deck this game gets a lot easier. You just have to find peace in doing nothing sometimes.


Finding a trading edge is only the first step, executing it with discipline over the long-term is the final step.


Fear of losing disappears once you realize you can always lose the next trade.


I took the leap and quit my job to trade full time.

Here’s how I turned trading from a side hustle to a full time job

  1. I saved up money. I was very stingy for a while and saved up enough money to make sure to have a rainy day fund big enough to cover at least 6 months of expenses in case things went south. This also gave me great peace of mind.
  2. I knew the risks. I was well aware that it wouldn’t be an easy journey and that things could very well go wrong. I took the risk because I felt I was young enough and didn’t have too many responsibilities and it was the best time to take the chance.
  3. I put in the work. Working for yourself sounds amazing, but it’s one of the most stressful and difficult things you can do. You need to have great discipline and routines that keep you operating a tight ship every day.
  4. I had a plan. I didn't just wake up one day and decide to trade full time. I had a well thought out plan just like any other business should. I had enough data from my trading to know I could perform consistently and had a plan to scale over time that I followed to a T.
  5. I believed in myself. At the end of the day, even with a perfect system, you'll never make it if you don't completely have faith in yourself. This mental state comes from countless hours of screen time, trading, and backtesting.


The intolerance of uncertainty is the engine that drives most trading errors.


The less you over-think, the less likely you are to over-trade.

Over-trading will hamper your returns on the "good days" and leaves large dents on your "bad days".

Reduce the clutter in your head first to begin making serious progress.


Lack of patience is killing you.

Stop focusing on the short term. Start focusing on the long term.

Stop thinking about missed opportunities. Start thinking about the next opportunities.

Never give up. Great things take time. Be patient.


Pain and suffering is often part of pursuing a big dream. Plus, it can accumulate and weigh down on you, making you underperform and your dream feel out of reach. But also can make you strong, like a sword forged in fire you wield experience others don't have.


What most people think:

Trading = Gambling


Trading = Edges + calculated risks + emotional fights + consistency + countless hours of practice


The only way you get a real education in the market is to invest cash, track your trade, and study your mistakes.


Selling your winners and holding your losers is like cutting the flowers and watering the weeds.


Some folks will never realize that most of the chaos in their life is caused, in large part, by their inability to make a simple plan and stick with it.


It is in learning to handle difficult and unpleasant emotions that you will become a great trader.


In last three weeks two young traders expired due to cardiac arrest. I sometimes think this stress to make money is necessary which spoil your health. Push yourself to stress free trading, else avoid trading and invest. After all you need to be there to enjoy the money.


Trading is hard. This will make it easier:

  1. Trading is not black and white. There is no one-size-fits-all approach. New traders struggle so much because they are looking for answers that don't exist.
  2. A big ego is a sign of inexperience. The best traders are humble because at some point during their journey, they got their ass handed to them by the market.
  3. It's important to only trade with money that you can afford to lose.
  4. Respect risk. You can make progress for months and then undo all of it in one undisciplined trade.
  5. The crowd will focus on complexity and try to reinvent the wheel. The best traders focus on simplicity and improve on what is known.
  6. Good things take time, and trading is no different. You need to be patient and give yourself time to learn and grow.
  7. Discipline is more important than intelligence.
  8. The most successful traders are the ones who have taken the time to understand themselves and their own motivations.
  9. Be patient when waiting for a setup. The best trades often take time to develop.
  10. A good plan is nothing if you don't stick to it.
  11. The analysis is easy; it's the execution that's hard.
  12. You have to go through the bad trades to get to the good ones.
  13. A trade is never a sure thing. You can do everything right and still lose money.
  14. If you are unwilling to lose, you will spend too much time checking your trades, over-analyzing, and making bad decisions.
  15. Don't over-complicate things. Keep your trading simple and easy to understand.
  16. Preparation reduces overthinking.
  17. You are not obligated to trade every day. Some days, there just isn't anything worth trading.
  18. Preserve your capital. Without it, you won't be able to trade for very long.
  19. Focus on the process, not the outcome. If you are doing the right things, the results will follow.
  20. Lastly, there is no final destination. Trading is an art that you spend your whole life perfecting.


I never got better at trading by changing strategies when I was losing. I got better at trading by staying in the game long enough to learn my strengths & get better at dealing with my weaknesses. Strategies don't make traders, traders make strategies.


Trading is a magic business.

You compound money with some clicks, where you want, when you want, with no limits.

Don't stop. Get better. Get successful.

Break your limits.


Most of the successful traders I know went through years of losing or breaking even. Trading is a serious discipline - make sure that is what you want to do before you even think of starting it.


When it comes to real trading, it should be boring. It means that you have very little diversity and you are doing the same things day in and day out.


Amateur traders are obsessed with making money.

Professional traders are obsessed with managing risks.


You are trading because you do not accept the 9-5 lifestyle! Work hard and remain focused on your goals if you want to succeed trading!

Defeat will never be an option; YOU ARE NOT A QUITTER.


For successful trading you need:

  1. Trading strategy with an edge
  2. Clear defined rules for entry, exit, position management
  3. Sound risk management principles
  4. Daily trading routine
  5. Trading journal
  6. Post analysis of all trades
  7. Process to learn from past trades


Trading the markets is living a few years like most people won't.

So that you can spend the rest of your life like most people can't.


The professional trader knows how to wait for the best trading opportunity. He/she is patiently waiting for all the stars to align before pulling the trigger.


Trade to live. Don't live to trade. That simple shift in perspective will make you a much better (and happier) trader. It takes you out of the rat race of comparison, ego and one upping yourself. It sets you free.


Trading is different.

After 5-7 years you can gain $1,000/hour.

But those $1000/hour are the result of 5-7 years of mistakes, failures and emotional fights.


Trading gives you a power very few can handle: Being alone.


Narrow your focus. Then narrow it some more. Find the one trade, the one method, the one situation that makes clear sense to you and drill down on it. Commit to it fully and block everything else out until it pays you. Own that one thing. Now you have edge.


If you don't find a way to make money while you sleep, you will work until you die.


Overtrading, always chasing more, is a HUGE account killer. The goal is to trade as little as possible. Get your chunk and go. The power is in the compounding week after week, month after month. The big weeks just show up. You don't go looking for them ever.


There are markets to let profits run patiently.
There are markets to take profits quickly.
There are markets to sell into the strength.
The price action of your stocks tell you the type of the market.
Listen to the tape!


Before taking a trade, ask yourself:

  • Am I following my trading system?
  • Am I following my risk plan?

Don't let your emotions kill your trading.


If you can't execute a trading system, you will never be a successful trader.

After you execute your system 100, 1,000, 10,000 times, trading will be much easier.

Become addicted to repetition.


The best trader in the world can lose the next trade.

The worst trader in the world can win the next trade.

1 trade is nothing. 1000 trades are everything.

That's why trading success is consistency.


Personal Finance Visuals.

  1. The first rule of compounding: Never interrupt it unnecessarily
  2. You need a reasonable amount of intelligence, but the temperament is 90% of it.
  3. When short term volatility affects the decision of your long term portfolio.
  4. Sustainable wealth is not made by chasing cryptos or overhyped IPOs.
  5. In my whole life, I have known no wise people who didn't read all the time – none, zero.
  6. The big money is not in the buying or selling, but in the waiting.
  7. The true investor welcomes volatility. A wildly fluctuating market means that irrationally low prices will periodically be attached to solid businesses.


You live jaded & paranoid if you regret everything you do that doesn't play out perfectly under your control. Miss me with that. If you did it from the heart, with courage, fixating on the clarity of hindsight is asking for regret. Be thankful for balls instead.


Most traders ask you a better trading system.

No one asks you how to plan, execute, manage risk, trades and your insane mind.


The fastest way to succeed in trading is by sticking to one strategy, adjusting it, and improving your psychological skills along the way. Stop jumping around.


How trading from a corporate account can help you to save taxes?

  1. The prime objective was only and only to reduce taxes. There's no other reason to trade from a corporate account.
  2. Form a private Ltd company
  3. Claiming Expenses: This is the most beneficial aspect of a private ltd company. You can literally claim any expenses in the name of the company.
  4. Rent expense: You can literally claim your office rent as an expense. Your registered office can also be your own house where you live.
  5. Entertainment expenses: This is the most exciting part of expense. You can include your travelling expense too including your flight tickets, hotel stays, restaurant bills , etc.
  6. Meeting expenses: Meeting client over dinner, to a theater show or to a sporting event such expenses are deductible. Also for business purpose when you socialize and have a lot of meetings and visits to several places.
  7. Buying appliances and gadgets: Whatever you want to buy, buy it in company's name be it a phone, laptop, tablet, etc. It can be considered a company's expense which can further reduce your tax liability.
  8. Buying assets: One can also buy any assets such as a house or a car directly from the private ltd company. This is a better option then transferring money into your own account since it leads to double taxation.
  9. Lower surcharge: Surcharge in private ltd company only lies between 7%-12% as compared to an individual where it varies between 10%-37%.
  10. Claiming depreciation: Whenever you buy any asset from the company, it can also be used to claim depreciation which further reduces the tax liability.


One thing I am always working on: Trade less! Let profits run, be patient and cut losing trades. That's all I have to do to make money.


Losses, mistakes and failures are part of every successful trader career. They just didn't give up.


If your trading is becoming boring, you're probably trading well.


I am a trader. I make trades. I cut losses short and let winners run. I trade a system that creates a good risk/reward ratio and manage the trade to minimize losses and maximize gains. That's what I do.


Most traders think trading is rocket science.

It is actually edge + probability + risk management.


Having an edge in trading is important. Knowing how and when to lean in is even more important. Great traders know how to press it when their edge is present AND they are present with their edge. This intuitive relationship is where performance explodes. Stay alert in the river.


Traders and investors get rewarded for taking overnight risk in the long term.


Don't forget that the general market trend is more important than picking the right stock. Don't forget that picking the right industry is more important than picking the right stock. Your job as a trader is to take the right position in a strong market and industry.


Trading is a game of survival.

Survive the learning curve.

Survive long enough to develop a system with an edge.

Survive drawdowns in capital and losing streaks.

Survive your own ego and emotions.


Embrace the challenge of it all. Make it fun. We get to chase a dream while figuring out a puzzle. How cool is that? How lucky are we? Trading is the journey of a lifetime. Sure, it's hard as hell, but it's your game, your rules, your destiny. Don't judge it, just chase it.


The "buy the close, sell the open" strategy is now up nearly 1100% since 1993, while the "buy the open, sell the close" strategy" is still negative.


A thin line always separates average and excellence.

From 9.9 to 9.7 a 100-meter athlete becomes world champion. From 95° to 100° the water turns into water vapor.

In trading, experience and execution turn an average trader into a top 5% trader.


Snipers wait patiently to hit their targets. Predators wait patiently to hunt their preys. Poker players wait patiently to play a good hand. But 90% of traders always break rules for their lack of patience.


I did not intend to get rich. I wanted to get independent, I just overshot!


Successful traders are just amateur traders who kept showing up until they found success.


A huge part of our success in trading comes from learning how to battle our inner demons. That can't be taught, it's a constant mental commitment.


Trading like any other skill takes time to master.

Stop beating yourself up if you are struggling.

Focus on protecting your capital, trade small and often, learn from your mistakes and keep moving forward.


Confidence drops when you're not trading well, not reading the market "moves" right or allowed discipline to slip. When that happens, you must step back and be brutally honest with yourself; what am I doing wrong? What should I really be doing? What's the plan of action going forward?


90% of traders are destroyed by their mindset.
They have an edge, but they don't execute.
They have a plan, but they break rules.
They have a goal, but they give up at the first failure.
Master your mindset and success will follow.


You will never forget the people who called you stupid at the beginning of your trading journey.


Only specialists make money in trading! Master one setup & strategy instead of being mediocre in 100.


To know how to wait is one of the great secrets of trading success.


Any trader telling you how they're not making any mistakes anymore or how they don't go through rough patches anymore are just full of it. Losses, mistakes and tough periods will always be part of trading, no matter how experienced you are.

Trading isn't just about learning to make money. You learn how to understand yourself. You learn how to understand how others think. You learn to understand how the madness of crowds think. It's an education on how the human mind works.


"The Strongest Negotiation Position Is To Be Able To Walk Away And Mean It". FOMO is a huge flaw in your business/career, investments, & relationships. People stay way to long in unhealthy situations because of this. Learn to be ok w being alone, better decisions occur because of this.


Trust me when I say this, I've seen ton of people get hot and come and go. They got forced out of the market. The disciplined and risk adverse ones are the only ones that stay alive in this game over the long run.


If you want to be wealthy then focus on building a skill set that can generate you money in exchange for your skill and not just time. Then leverage that skillset/business to generate more money at scale. Take the profits and invest in assets.


Emotional traders will never be successful traders. They only need 1 day to ruin 3-5 years of efforts.


If you're going through a rough time there’s no shame in taking a break from the market. Forcing yourself to trade when you are mentally exhausted is a recipe for disaster. As a retail trader one of your main disadvantages is your emotions, and when you are unable to control them you're just making it even harder for yourself.


Here's a realistic fact. No real trader EVER brags or boasts about anything they do or have done. Ever. Because, I’m living proof, 1-5-10 years in, everyone can be crippled. So if someone is on twitter and bragging they are full of shit.


QT 101

QT is simply the Fed reducing its balance sheet. They accomplish this in two ways. 1) They let their existing maturities payoff and they don't reinvest the proceeds and burn the cash (called runoff). 2) They sell bonds and mortgages into the private market (Called outright sales). It is a weak but still useful lever to reduce inflation. It operates by causing all assets to weaken as the fed lack of buying has to be absorbed by the market. This impacts inflation by making asset holders less wealthy and decreasing demand for goods and services. That's why the fed is doing it.


Trading gets better when you realize you don't need to catch every single market movement.


If you have a bad hand, you can fold. There are no medals given for being a martyr to your trauma.


The beautiful thing about this game is that it doesn’t have a time limit. You can play at your own pace and decide to enter only when the market conditions fit your criteria. It doesn’t matter what everyone else is doing. You have your goals. Follows the rules and survive.


George Soros is the best loss taker I've ever seen. He doesn't care whether he wins or loses on a trade. If a trade doesn't work, he's confident enough about his ability to win on other trades that he can easily walk away from the position.


If you only wished to be happy, this could be easily accomplished; but we wish to be happier than other people, and this is always difficult, for we believe others to be happier than they are.


The most important aspect of trading is the knowledge & ability to increase size, decrease size & not trade. Remember, having nothing on is a trading decision.


The urge to be active in the markets all the time can kill your performance! It's essential to sit on your hands and do nothing if there is nothing to do!


Never let one trade ruin years of compounding money and building trading skills.


Trading shouldn't be gambling.

You should only take trades that you have an edge on & are QUALITY.

Respect your money or it will find a new owner.


Patience is like a muscle. You can train it! No child is born with patience, but learn it over time and with experience. As a trader you need a strong patience muscle and that means you have to train it.


Winning in the market is a matter of discipline and being able to spot patterns which time and again have led to big winners.


Cutting your losers short and letting your winners run sounds too simple but it is the core of profitable trading. The majority of traders do the opposite and that is why they lose.


The market doesn't care who you are or how high your IQ is. All that matters is whether you have an edge and how well you can execute it with discipline and risk management.


The sooner you start working on your mindset, the sooner you will stop ruining your trades, breaking rules, doubting yourself, doing the same mistake over and over again. Your mindset is your most important asset.


To become a profitable trader requires patience, systematic thinking, consistency, discipline, and confidence. Without these skills trading success is unlikely, with these skills success in any area of life is almost certain.


Focus on the Leading Groups and the LEADING STOCKS in those groups. THAT IS WHERE MONEY FLOWS. And always control risk. Clean and simple base entry with volume surge pays the best.


When market conditions aren't favorable to me or my strategy I am far better walking away from the trading desk than trying to force things.
This way I get to preserve both financial and emotional capital.
The market will still be there when I return.


Trading is mental fiction.
Fear and greed sabotage yourself.
You create them in your mind.


You have to learn how to lose; it is more important than learning how to win.


Years 1-2 are the most difficult.
You don't know how to plan, execute, take risks, think in probability.
Just keep going.


If you want to fail, tell everybody your plans. If you want to succeed, keep your mouth shut.



The key secrets were self-discipline and patience. He knew to be truly successful one had to wait for the right opportunities to present themselves, and this could sometimes mean doing nothing for long periods of time. This inactivity is especially difficult for active stock traders, but the very best ones know how to control this and avoid the impulse trades and the overtrading that can be very costly to their portfolio.


If you are in the middle of a street and you see a truck heading towards you at high speed, you don't say I know the driver or it always stops there or I think it will stop. No, you get the hell out of the way. That is what you have to do with stocks.


Just sat down & reviewed all my trades/charts for three hours after market close.
Nobody sees what goes on behind the scenes for the "successful" people to be successful.
People only see the results & not the steps people take to get there.
Success take extra effort.


The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading.


It's all about mindset.
A loser will always find a way to give up.
A winner will always find a way to become successful.


I blew up several accounts early in my career purely through frustration, not because of a bad strategy. No trade is worth blowing your account up. Frustration is something we all face in trading. Don't take losing personal. Stay In The Game!


Buying shallow pullbacks over rising 20 or 50-sma is "buying the dip".
Buying into waterfall downtrends, below declining MAs and/or making new lows is buying downtrends.
It's important to keep this in mind. Not all pullbacks or charts need to be held or bought.


Emotions are the hardest thing to control.
But once you do it, the impossible become possible.


1 computer.

1 trading system.

1 powerful mindset.

No limits.


Not getting angry after a loss is the most useful skill you can learn.


The markets are a never ending stream of opportunities. You don't get the same quality of opportunities every day, week or months. That's why patience is important. Wait for the "window of opportunity" where the market screams to you: "It is time to make money!!".


Trading is a mental game. If you can't control your emotions, your trading journey is a one-way ticket to failure.


Trading is a daily battle against your emotions.


One of the reasons being a successful trader is so hard is because you have to have the ultimate belief in yourself. Failure occurs on a daily basis & it's not easy to get over it. We have to heal quickly, have short term memory for some things & never forget other things


The secret of becoming a successful #trader is never stop learning. Learn from your mistakes. Learn from other traders. Learn from the market. Over time you become humble and a master.


Psychology of Risk For Traders

A risk management process for a trading system is not just math but also includes human psychology. The psychology of execution is just as important to profitability as the trading dynamics of the entries & exits of a trading method.

  1. Believing too strongly in a trade can lead a trader to trade too big a position size when they think something must happen. Nothing is certain and position sizing has to be kept within risk guidelines at all times.
  2. The fear of losing money can make a trader not exit at their preplanned stop loss and keep holding and hoping a trade reverses back to at least break even so they can get out. This back to even trade exit is what can create resistance on a chart in a market that is in a downtrend
  3. If the chart stays in a downtrend then not taking the stop loss when it is small can turn the trade into a big loss.
  4. A trader must embrace uncertainty in any trade. Anything can happen and you have to have a plan for each contingency. Accept that you don't know what is going to happen and risk is always present.
  5. Cognitive bias, certainty, and ego can cause traders to abandon risk management because they think they know what will happen next, they don't, and the first time they are wrong can be the end of their trading account if they don't manage risk.
  6. The fear of missing out (FOMO) can cause a trader to forget about their entry signal and chase a chart to higher prices too late in a swing or trend. FOMO can cause a trader to enter with bad risk/reward ratios because they are afraid of missing out on profits.
  7. The fear of losing open profits in a trade can cause a trader to exit too early in a trend for a small win and miss out on a big win if they let a winner run.
  8. A trader should exit a winning trade when there is a good reason to, like a profit target is reached or a trailing stop is triggered not just because they don't want to lose their small profits. A trader has to risk small open profits if they want a chance for big profits.
  9. A trading plan has to be written when the market is closed so you don't do anything emotional when the market is open.
  10. Part of a trading plan is risk management guidelines, it can be difficult to always make good trading decisions when real money is at risk and prices are changing every second and emotions are kicking in. A trading plan can give you a quick filter on what to do.
  11. An ego can cause a trader to hold on to a losing trade because they don't want to admit they are wrong. The more people a trader tells others about their opinions, predictions, or positions the harder it is for them to exit when they are wrong.
  12. A trader must have faith in their self & their system to execute their trades without excessive stress. High stress can lead to bad decisions on entries & exits. A trader must develop a system that they can use to trade through the ups & downs of their equity curve without stress
  13. Most traders fail to make any money in the market because they can't manage their fear, greed, stress, and ego and this causes them to create bad risk management practices.
  14. A good risk management process minimizes losses and maximizes gains. A risk management plan helps guide your decisions based on your trading system guidelines that eliminates the risk of ruin and not be driven by your ego or emotions.


"What if it works out?"

The best question you never ask yourself.


Every successful trader knew that trading success was their destiny.


If a man knows more than others, he becomes lonely.


The whole secret to winning big in the stock market is not to be right all the time, but to lose the least amount possible when you're wrong.


Successful traders practiced 5-7 years gaining 0$. After 5-7 years they just need few hours to gain thousands of $.


I break my rules.
I chase entries.
I repeat mistakes over and over.
I get manic.
I go on tilt sometimes.
I oversize because I'm needy and totally mismanage my risk.
I have days where I have no clue what I'm doing.
After 25 years, I still do ALL this shit, and yet I find a way.

You see it isn't perfection. Far from it. Actually, it is often messy as fuck. But that's being a trader. You can't destroy yourself internally when your head is up your ass. You need wider bands of normal. Otherwise, you will miss the really good shit you can do. The trading life is a winding road. You have to accept failure, loss, and the feeling of being lost all the time. We are always searching for the light switch in the dark. Feeling that is normal. So forgive yourself when you suck because the good moments will cover you if you let it.


Trading success isn't only one trade.

It's 1,000 mistakes, 10,000 losses and 1,000,000 emotional fights.


Working hard for something we don't care about is called stress. Working hard for something we love is called passion.


Trading success is a mix of self-discipline, patience and confidence.
Develop self-discipline and you'll be a great executioner.
Develop patience and you'll have a great trading journey.
Develop confidence and you'll become unstoppable.


Sentiment is always more negative on bottom retests than in the FIRST low. Watch out above is the retest is successful. Most double bottoms come with strong MACD/RSI divergences. A powerful event if you see this.


Psychology fact: Eliminate fear to increase your trading success. Reduce your risk, backtest your system. Once you become fearless, trading becomes limitless.


Top 5 Trading Rules from Ed Seykota

  1. Cutting losses: The element of good trading.
  2. Ride winners: The trend is your friend.
  3. Keep bets small: The key to long-term survival and prosperity.
  4. Follow the rules without question.
  5. Know when to break the rules.


You spend years changing systems and indicators only to realize you need discipline and confidence to execute one system.


Stop losses + right position sizing = small losses.


Most traders come and go. Only those who keep fighting every day eventually become successful.


Your trading will change completely when you realize all your losses, mistakes and failures are your fault.


If you're a perfectionist, trading isn't for you. Most trades won't go perfectly. You'll enter a little late, exit early, get shaken out of a trend, get stopped and have it reverse your way. All part of it: Goal is just to collect some profit each time & keep a lid on losses.


It's impossible to succeed in trading without emotional control.


A trader who can say "I was wrong" after a trading mistake is a confident trader.


I've never been the smartest person in a room. But when I'm in a trade, I don’t listen to anyone. I have my criteria for entry & know where I need to exit if proven wrong. It’s my trade. I live with the results. It’s not arrogance. It’s just a personal experience one that I happen to share


Impatience is the biggest problem.
  • Trading is not an hobby
  • Trading is not a lottery
  • Trading is 90% waiting
Remember, great things take time.


Only on twitter do traders win every trade. In real life, most elite hedge funds & pro independent traders have win rates of 50-70%. Consistent/no exceptions loss size control must be as much of a focus as developing an edge, since no strategy regardless how strong works without it


Things I wish I knew when I started out my career
  1. Mindset Matters. All the good traders I've met have been super optimistic and filled with self belief. Their work ethic makes their success inevitable but they never behave like the market owes them that success today.
  2. Every trader loses. No day trader has a 90% + win rate. If they tell you that then they are bull shitting you. Run. Elite traders have a win rate in the 70s. It's not about how often you win, it's about how you protect yourself when you don't.
  3. Don't fall for the lifestyle. I haven't met a single legit trader who brags about their lambo or flexes their gains on Instagram. That's a marketing gimmick. No profitable trader trades so they can buy things. They trade because they love trading. Money is a by product
  4. Your Strategy is overrated. Nothing works all the time. Everything works some of the time. If you target 10-1 risk reward you have to be correct 15% of the time to make serious coin. You can basically be a total freaking idiot and still be profitable.
  5. Good trading is patient trading. Sit and wait for your perfect setup. Don't chase after it. Traders get paid for their decisions not their time. There will be times to trade and times to sit. You should spend more time sitting than trading
  6. Risk Management is King. Your first job as a trader is to come back and trade again tomorrow. Bullet proof your risk management and you will make your success inevitable. The less you can risk per trade the higher likelihood you have of becoming a millionaire
  7. Delay gratification. I want to trade for a lifetime not for a week. I won't get rich trading in a week but I can in a year. Do what's best for your account tomorrow. Not what you think is best for it today.
  8. Be Selfish. Trading is you vs you. It's not you vs the market or you vs your friend. Do what is best for you at all times.
  9. Never Average Down. Averaging down is the fastest way to blow up your account. Because it's a way of refusing to admit you are wrong. Stop expecting perfection and design around failure first. If someone is telling you to average down - Run. They aren't trading real money.


You learn more from your losses, than from your gains.


Paul Tudor Jones' 11 Trading Principles that made him a Legend and a Billionaire:
  1. "The secret to being successful from a trading perspective is to have an indefatigable and an undying and unquenchable thirst for information and knowledge."
  2. "At the end of the day, your job is to buy what goes up and to sell what goes down."
  3. "Every day I assume every position I have is wrong."
  4. "Losers average losers."
  5. "You adapt, evolve, compete or die."
  6. "Failure was a key element to my life's journey."
  7. "At the end of the day, the most important thing is how good are you at risk control."
  8. "If I have positions going against me, I get right out; if they are going for me, I keep them. Risk control is the most important thing in trading. If you have a losing position that is making you uncomfortable, the solution is simple: Get out, because you can always get back in."
  9. "When I am trading poorly, I keep reducing my position size. That way, I will be trading my smallest position size when my trading is worst."
  10. "I look for opportunities with tremendously skewed reward-risk opportunities. Don't ever let them get into your pocket – that means there's no reason to leverage substantially. There's no reason to take substantial amounts of financial risk ever."
  11. "You should always be able to find something where you can skew the reward risk relationship so greatly in your favor that you can take a variety of small investments with great reward risk opportunities that should give you minimum draw down pain & maximum upside opportunities."


Trading 101

Trading system: Build edges, study charts, create plans, execute them.

Risk management: Create plans, follow rules, set goals, achieve them.

Psychology: Build confidence, emotional control, long-term thinking, be in control.


Fear of losing disappears when you start thinking in probabilities.


Anybody can make money in trading but keeping that money is what matters.


Trading is not predicting the future.
It's executing your systems, trading plans, risk plans over and over until you are golden.
Control what you can control, forget everything else.


Become so disciplined in your trading that no mistakes or losses can derail your execution.


Trading for the sake of trading and trading to make money aren't the same thing and it often takes most sometime to realize this. Often the best trade is to do nothing, sit in winners and pass on mediocre charts. Trader time frame is a key factor.


90% of traders fail because their risk is too high. There's no room for beginner mistakes.


Normalize executing your trading system without getting affected by your emotions.


  1. Both SPX and SPY represent the S&P500. SPX is the actual index, meaning you can't trade it - there are no shares, it is simply a "calculator" constantly multiplying current company stock price * percent weighting by market cap in the S&P.
  2. SPY, on the other hand, is an ETF meant to mirror SPX at a roughly 1/10 price. The funds backing SPY are reweighted every night to accurately represent the S&P. Ex: At close, $AAPL made up ~7.08% of the S&P by mkt cap, so holdings will be reallocated tonight to show this
  3. Which is better to trade? This comes down to many factors, such as account size and brokerage commission fees. SPY premiums are near 1/10 a correlated premium in SPX due to underlying asset price (450C vs 4500C). Someone with high fees may opt for SPX (less cons)
  4. During intraday and o/n swinging, % returns will be marginally identical; however, late day 0DTE's is where things get really interesting. Also *FYI*, SPY and SPX (as well as QQQ and NQX) options trade until 4:15pm, except index options on 0DTE. SPX/NDX 0DTE's close at 4pm
  5. Late day 0DTE's is where SPX can really shine. Since, at their basics, option premiums are comprised of intrinsic value and time value, at expiration you are solely left with intrinsic value (this is how traders/investors looking to exercise calculate their B/E).
  6. Now think about this with underlying asset price. We'll use today's 3/31 contracts for reference. Something deep OTM, or "lottos", on either will be nearly worthless - expiration is close so theta decay has taken almost all time value out, and there is no intrinsic value
  7. Index options are also cash settling, so if they're ITM, you can let them ride into the bell without stress of needing to get filled on the sell
  8. While holding ITM SPY contracts into close (4:15pm EST) will result in the exercising of them, SPX options exercise as cash settling at intrinsic value. This means that you could hold the 4550P into 4pm and wake up to $1959 of cash per contract the next day.
  9. Whereas the last trade price of SPX 4550P was 14.90, but you could have comfortable held into the close for $500 more per contract knowing it was cash settling and you wouldn't be auto-exercised with shares like a stock or ETF.


I realized very late in my trading career that "How you do anything outside of your trading life determines how you do trading." If you want to change your trading result, you need to change yourself.


No trading success can be appreciated enough without the right amount of failures.


They call you stupid if you lose money for 5 years, until in 1 month you earn more of their annual salary. Trading is powerful.


Never let someone's comments shake you out of a trade. They don't know your plan or risk management skills. Quiet the noise.


Let go of your losses. Let go of the stupid shit you did this week. It's ok, we all go through it, you're not alone. Breathe. Heal. Regroup.


Trading is total.
  1. Emotion control (Patience, Discipline, Confidence)
  2. Strategy (Planning, System execution, Risk management)
  3. World behavior (Supply & Demand, Fear & Greed)
If you can overcome the trading learning curve, you can do anything.


Long term successful trading has 5 key components in order of importance.
  1. Trading Psychology - understanding your mental/emotional makeup. What makes you trigger and what makes you tick. Prioritize and protect confidence at all times.
  2. Have a big picture strategy, style and risk management that flows well with #1 and make sense to you.
  3. Understanding the environment, it's nuances, and how it effects your strategy and risk (#2). In other words, know when the deck is stacked for your style and when it is not.
  4. Fish in the right pond. Find the best sectors and stocks that will exploit your strategy in a given environment.
  5. Have clearly defined setups with defined risk to take advantage of 1-4.


To win in the markets, we need to master three essential components of trading: sound psychology, a logical trading system, and an effective risk management plan.


Not every day will feel like progress. But you have to persevere if you want to trade for a living.
  • Stick to your rules
  • Wait for your setups
  • Take profits as the market hands them to you
  • Be patient, the market is always here.


One of the costliest fallacies that I see online is that 'hedging' is the answer to holding onto stocks as they unwind in major downtrends. More cash & less trading are the best true hedges-also discipline, risk management, avoiding downtrends & under trading are all better practices.


The most important thing you MUST implement if you want to make it in this game for the long run is, RISK MANAGEMENT. You can be right 90% of the time but if you're risk is off balance, that one bad trade with bad position sizing and no exit plan can crush you.


How to become a worse trader
  1. Let losses run
  2. Act emotionally
  3. Follow the news
  4. Try to copy other traders
  5. Overtrading
  6. Trading too big positions
  7. Take profits too soon
  8. Trade with money you need


"Size, Size, Size, When You Think You're Right!". That's how he made fortunes. It's a mistake if you are in a big winning stocks and you have only a 5% or 10% positions. You biggest winners must be your biggest trades (20-30% or more)!


Personal finance is 80% discipline and 20% math
Health is 80% nutrition and 20% exercise
Good communication is 80% listening and 20% talking
Intelligence is 80% comprehension and 20% reading
Success is 80% working and 20% goals
Happiness is 80% appreciation and 20% purpose


To become a successful trader, you have to believe there is no other path for you.


Trading is so psychologically demanding. I don't care how long you've been doing this; the swings beat you up mentally & they also take a toll on you physically…even when you're winning. Take care of your mind & your body when you're away from the screens


You can decide when you dine. I’m not dining yet this week until the market presents some michelin star quality dish. That is all.


When you make the decision to protect your capital, not your ego. To become a master of one thing, not be an amateur at many things. To forget about the money and the failures and focus on process. And to unconditionally commit and never quit, then your true potential can emerge.


For those trying to understand the sector rotations - the two key drivers of stocks are liquidity (yields, rates, monetary policy) and earnings. When liquidity is very high, earnings aren't a focus, when liquidity tightens, earnings become much more important.


How can "quality" stocks go down 50-90%? Because stocks are like art, priced on perception. There is very little intrinsic value. Without a willing buyer, they are simply little pieces of worthless paper. Understanding this reality is the first step to managing risk in equities.


I'm a huge believer in low stress trading. If you’re getting emotional over small moves you're likely oversized. Max loss should be fully accepted before trade, and should be an amount your fine taking many times in a row. Smaller size = Less emotion = easier to follow plan = more profit


Great traders have these 10 similarities:
  1. They love the game
  2. They did their homework
  3. Risk management
  4. Discipline
  5. Always learning
  6. Specialization
  7. Faith in their edge
  8. Faith in their self to follow it
  9. Consistency
  10. Perseverance


Every trader will get to a point where more knowledge about the market will not help anymore. Increasing your technical or fundamentals knowledge is a dead edge. Instead you must increase the knowledge about YOURSELF! That's the key to trading success.


The best poker players in the world end up at the final table every year, it’s not all luck. Its discipline & knowing when not to play when the hands dealt aren't favorable.


3 straight losses - not allowed to trade the next day. No improv/non-planned trades following losses - so basically shut it down if nothing triggers (vs start looking for revenge trades). Doubling down on losing trade. Penalties range from 1 day to a week.


Those who took comfort in the strength of the popular averages but failed to respect dwindling participation and stocks breaking down have seen losses balloon. I could care less if the Dow goes up 30%; if stocks fail to meet my criteria, I sit on my hands and I cut my losses.


Rule #1 is always to not lose a lot of money, and to not put yourself in a position to lose a lot of money ahead of major events or when you have no clear read.


Overtrading used to be my biggest issue. If you trade 3-5 times daily, chances are higher you’ll have 3-5 loss days as well. Now I rarely have losing streaks or losing weeks. Focus on doing less and you’ll make more. Always slow things down even more when others are in a hurry.


How to go from mediocre to super performer
  1. Admit you suck
  2. Believe you can be great
  3. Find someone great
  4. Shut up and listen
  5. Commit to a proven process; sacrifice all other processes
  6. Don't try to find time. Make time.
  7. Take consistent action.
  8. Push beyond your comfort zone.
  9. Embrace setbacks as valuable teachers.
  10. Make your dream a priority.


One major mistake that novice traders make is over-trading, especially in higher volatility markets. They often get spun from long, to short, to long & flip daily w/the market. Trade less, follow the same plan, don't change the process due to short term volatility - stay consistent.


We can either trade what we see, or we can trade what we think. If we trade what we see, we stay objective to price & react, knowing what to look for in each direction. If we trade what we think, it's easy to fall into the trap of directional bias & fighting the tape.


Most of the time, I wait. I do something else. It has taken me so long to not trade in order to trade the right way that I have come to the conclusion that trading is basically not trading most of the time.


A secret of professional traders: they focus on their own trading! They have enough trust in their trading system and skills that they can ignore everything else. That's the state you want to achieve.


You'd be surprised that the traders who make the most money are often the traders who don't trade often. Instead, they let their winners run and benefit from strong market trends.


Great traders understand diff between looking for a trade and seeing the trade. Remain patient, they always come. When they do it's obvious.


I didn't know who I was as a trader until my back was against the wall and I had to figure out how to make it happen or I was done. Pressure is good because it makes us perform at our highest level to see what we're truly made of.


Just try and be better from where you are now. Be specific about the best practices that will help you improve. Execute on these best practices. Change starts with one first step.


Stop getting angry over missed trades. Trading opportunities are like trains. Just get ready for the next one.


A trading mistake repeated more than once is a mental error.


Cut your losers and let winners ride sounds good & easy, but this as a blanket statement will hurt many traders because they'll over trade & spent a shit ton on fees. The focus should be learning to recognize environment & conditions that tell you to cut losers or hold winners.


It’s not about being a bull or bear. It’s just trading technically both ways.. support/resistance, supply/demand zone and channels. This is all a game. Have to be able to play defense & offense to be a complete trader.


The final goal of every trader is freedom.


The final goal of every trader is freedom.


5 years of pain, suffering, failures, hard work, emotional breakdowns, but they still call you lucky.


Money is just a tool. The sooner you realize this, the sooner you can start mastering your emotions.


Calm after a trading loss is the highest sign of confidence.


No one would ever expect to be great at golf, baseball, trial law or accounting in just a couple years. But many have that expectation about trading. In my opinion, trading is even harder; give it the respect it deserves which means giving yourself some time. It's worth the wait.


One of my mentors beat this into me. "Traders are not born with the patience gene. It's learned the hard way. This is a game of the patient taking money from the impatient."


Years ago an old trader said he didn’t take vacations with his family because it not only cost him the $ for the trip, it cost him the 10k he would have made trading. That trader died at 55, divorced but rich as hell. I can’t stress the importance of taking time away. Slow down!


Our trading is a journey of emotions, a journey of executing setups in different environments & it’s up to us to be present, but to also look back at how we've traded in the past to get better at trading the markets in front of us.


Find something that motivates you so much that when you think you're at 100% effort, you give it another 150% without even thinking.


Being a trader should be a small portion of who we are. Being a spouse, parent, athlete, friend etc will take the pressure off of being just a trader.


A smart trader knows what to trade. A wise trader knows when to trade it.


You will never get huge returns with any real consistency holding a diversified portfolio of stocks through thick and thin. Big performance with little drawdown requires:
  1. Timing
  2. Turnover
  3. Aggressive position sizing when trades are working, light or cash when they're not.


You will never know what your true potential really is until you make the decision to believe in your own ability and take action. Commit to an unconditional march in the directions of your dreams. You will amaze yourself!


It's amazing how good I can trade one day and bad the next. If you think it's all about your technical strategy you're just kidding yourself. Trading is a journey of oneself.


2-3 years ago a very smart friend/fund manager of mine pointed out that unless market inflows swing negative and stay that way, there's no reason to be bearish. So simple but blew my permabear brain to pieces. Been watching market flows like a hawk ever since.


Why waste your time talking, watching, or thinking about something that's stuck in a sideways consolidation range. Instead, put in an alert and enjoy your life.


One of the most important decisions is when to do nothing. Jesse Livermore said: "You can beat a horse race, but you can't beat the races." Only a fool is in the market all the time. You must be patient and wait for reward to outweighs risk before getting aggressive.


Only losers discourage dreamers. Only those who never achieved big things discourage those attempting to achieve big things. Only those who think small discourage those who think big. Never believe discourages. They have no credibility! Believe winners. Believe in YOU!


The more times you're in a situation the better you become with handling it & in my experience this the only way we can "control" emotions in trading. But that's really not control, it's experience in dealing with situations.


Leave with this. Remember without our health none of this matters. Do something this weekend that works your body and lets your mind relax. Be safe, be well.


Successful trading is a lot about existing long enough to learn about yourself & your style. If you can learn how to survive through the tough times...the winners will come & you will be better at recognizing them and taking advantage of them.


I don't need to find the hottest stock or nail the biggest trades, and I don't ever need to maximize a move. I need a process that identifies enough reliable r/r trades to consistently produce results. Obsessing about the big trade can be a hugely counterproductive mindfuck.


When we lose we sometimes think the game has changed and it's not us. The truth is the environment is always changing and it's up to us to figure out how to make money in changing environments.


I've found that confidence and euphoria are the biggest enemies of trading. Better to be neutral, no attachment to the outcome, focused on probabilities.


Trading journey:
  1. First, you lose money.
  2. Then you learn how not to lose money.
  3. Then you make money.
  4. Then you learn to keep what you've made.


The market is communicating to tread light and be more cautious right now, especially in the "risk on" growth arena. If you're still being aggressive and looking for big plays you're missing the current message. Its okay to wait. Its ok to miss a move. The deck isn't stacked right now.


Fearing to attempt. Attachment to the outcome. The twin anchors of human anxiety.


Take the risk. If you win, you will be happy. If you lose, you will be wise. Not sure who said this, but if you find yourself hesitating, I've found the best thing to do is take the plunge and see what happens.


As a trader, you want to play in a sandbox that is safe. When QQQ closed below its 34 EMA on the daily chart last week, that was a signal that the sandbox is no longer safe. Cash and patience is a position.


If the setup is still valid, ignore your emotions as they will betray you.


BTFD or STFR? As a general rule, above the daily 21 EMA buy the dip, exit at upward extensions. Below the 21 EMA sell the rally, exit at downward extensions.


One trap that novice traders fall into is trying to do too much all the time - too much turnover, too many different entry signals, patterns, time frames, etc. One or two signals/patterns executed consistently over time is often more profitable than being average at too many.


It's ok to be in cash and miss moves. Surfers aren't depressed just because they can't touch all of the water.


Making money is the easy part, keeping it is the game.


Shorting a stock because it seems too high is like slapping your neighbor's child because they seem too well behaved. Both instances can get you into trouble.


If you keep looking back, you’re going to miss the opportunities in the future


The people who are always looking to fight trends are the ones that missed them. Don't fight what's working, participate in it.


When you're in a nice trade, great entry, solid plan, well thought out target and you're getting that itch to tap out early, remember what the old man told me on the NYMEX floor 'Hey kid, if you want to take the train to California, you don't get off in Chicago'


Biggest mistakes I made during my trading journey:
  1. FOMO trades
  2. News driven trades
  3. Not sticking to my plan
  4. Not trading with a style that fits my personality
  5. Focusing on riches and not process
  6. Not understanding the importance of risk management


No two traders trade alike. Learn from others, but trade your plan. Finding a plan that fits your personality expedites the learning curve. Your satisfaction in your success will multiply