Dr. Brett Steenbarger agrees on the importance of simulation as a trading base.How many times have you heard this from friends or family?
"Yea but are you making real money?"
"If it was easy, everyone would do it"
" It's like gambling"
I took a course a few years ago in which they mandated after the trader fully understood the system, that they use a real simulator to trade with realtime market data. They required that you have 10 profitable days in a row in which you hit your profit target. If you made it to day 8 and failed, you start again. Only when you had this hurdle overcome, did you think about trading real money.
This simple concept is more important than any training anyone could have. If you do not have confidence in seeing the system win and lose, your emotions will be too great upon entering and managing a real trade. I am lucky enough to have worked through the emotion of real money while swing trading. This simulation idea really made an impression on me though.
I read recently where a trader simulated for six solid months everyday to learn the ups and downs of his system. (ESResistance) I am happy to say he now reports he makes his income all from trading full time. This is AFTER he took the time to learn it strengths and weaknesses and more importantly his own weaknesses.
I rarely get a positive response from anyone when they ask about trading. There seems to be three scenarios I hear with the third being rare.
1. Are you making real money yet, if so why arent you rich?
2. Yea, I knew a daytrader once, he did great for awhile then lost it all and more.
3. Yes, I know a guy who trades from home and does very well.
It is human nature to question traders and to believe it's not possible. Try and brush it off and move on to more pleasant conversation, like how they are hoping the plant does not lay them off, or just how crazy gas prices are. Thinking outside the box that we were indoctrinated into scares the average person. Try not to take it personally.
So let's address those comments.
How much real money are you making then???
None. I am not making real money yet, but I am posting a daily profit for X days in a row on average. I am training to be a methodical, logical and calm trader before I risk my hard earned capital. I want to trade for life, not for 6 months.
If it's that easy everyone would do it, why isn't everyone doing it?
Because it in fact is not easy and requires a special personality to truly succeed and overcome common psychological flaws and preconceptions that we all have. If they really think your simulation is easy or not real, ask them to do the same and show profitable trading consistently.
"Why not just go gamble because that's all your doing"
If there is a casino that will allow its customers a 70-85% edge in winning, then I am gambling. By the way, what's the address to that casino? A casino can make all the money in the world with a 5% edge. I am risking money trading only when I know I have clear edge and I know the maximum risk if I am wrong.
Simulate as long or longer than you feel you need to. You have nothing to prove to anyone but yourself. Have a profit and loss goal in mind for the day and go back to simulated once you have won or lost the max for the day. Slowly build your trading up to where you need it to be only when your are consistently profitable and more importantly comfortable.
"Yea but are you making real money?"
"If it was easy, everyone would do it"
" It's like gambling"
I took a course a few years ago in which they mandated after the trader fully understood the system, that they use a real simulator to trade with realtime market data. They required that you have 10 profitable days in a row in which you hit your profit target. If you made it to day 8 and failed, you start again. Only when you had this hurdle overcome, did you think about trading real money.
This simple concept is more important than any training anyone could have. If you do not have confidence in seeing the system win and lose, your emotions will be too great upon entering and managing a real trade. I am lucky enough to have worked through the emotion of real money while swing trading. This simulation idea really made an impression on me though.
I read recently where a trader simulated for six solid months everyday to learn the ups and downs of his system. (ESResistance) I am happy to say he now reports he makes his income all from trading full time. This is AFTER he took the time to learn it strengths and weaknesses and more importantly his own weaknesses.
I rarely get a positive response from anyone when they ask about trading. There seems to be three scenarios I hear with the third being rare.
1. Are you making real money yet, if so why arent you rich?
2. Yea, I knew a daytrader once, he did great for awhile then lost it all and more.
3. Yes, I know a guy who trades from home and does very well.
It is human nature to question traders and to believe it's not possible. Try and brush it off and move on to more pleasant conversation, like how they are hoping the plant does not lay them off, or just how crazy gas prices are. Thinking outside the box that we were indoctrinated into scares the average person. Try not to take it personally.
So let's address those comments.
How much real money are you making then???
None. I am not making real money yet, but I am posting a daily profit for X days in a row on average. I am training to be a methodical, logical and calm trader before I risk my hard earned capital. I want to trade for life, not for 6 months.
If it's that easy everyone would do it, why isn't everyone doing it?
Because it in fact is not easy and requires a special personality to truly succeed and overcome common psychological flaws and preconceptions that we all have. If they really think your simulation is easy or not real, ask them to do the same and show profitable trading consistently.
"Why not just go gamble because that's all your doing"
If there is a casino that will allow its customers a 70-85% edge in winning, then I am gambling. By the way, what's the address to that casino? A casino can make all the money in the world with a 5% edge. I am risking money trading only when I know I have clear edge and I know the maximum risk if I am wrong.
Simulate as long or longer than you feel you need to. You have nothing to prove to anyone but yourself. Have a profit and loss goal in mind for the day and go back to simulated once you have won or lost the max for the day. Slowly build your trading up to where you need it to be only when your are consistently profitable and more importantly comfortable.
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