10/21/2009
Who Are You
So far out of 377 posts one has proven popular.
That means the probability of this one being good is 0.26525%.
On the other hand, I'm due.
The "popular" post listed the reason why you should not be a trader.
Perhaps a more positive spin would be to list what a trader is.
A professional trader is a risk manager.
A trader manages risk, all day, every day.
A trader identifies opportunities and exploits them.
A trader only trades when his risk parameters have been met.
A trader does not take all the possible moves in the market place.
A trader misses opportunities in order to preserve capital.
A trader will limit their upside in order to limit their downside.
A trader knows that capital preservation is the first rule of each and every day.
A trader takes a fixed number / percentage of risk opportunities per day / week / month / year.
A trader does not exceed these limits.
A trader only increases these limits as their capital grows.
A trader decreases these limits if their capital shrinks.
A trader is someone who never stops learning, never stops questioning, and never grows over confident.
A trader provides liquidity and price discovery to the market place.
A trader predetermines how much money they can lose in a day.
A trader is a risk manager.
I trade the CME Group's New York Mercantile Exchange electronic crude oil futures contract.
I use Interactive Brokers for data and to clear my trades, Sierra Charts to display the last price in a visually attractive manner, and Bracket Trader to place my order, break even, stop, and target with Interactive Brokers.
I wait until the bids and asks move price into my predefined trend before I place my order.
This is what I do.
My name is Solfest and I am a trader.
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Hole punch.
Notebook.
great post...
Wonderful, Solfest. You pretty much summed up everything I had to learn the hard way. I particularly identify with these:
A trader does not take all the possible moves in the market place.
A trader misses opportunities in order to preserve capital.
A trader only increases these limits as their capital grows.
A trader decreases these limits if their capital shrinks.
Thanks guys, now if I could just fix those 376 loser posts. :)
The break has done you good, thought-provoking stuff.
If I might be bold enough to suggest a useful addition (that was in an English accent)...
A trader understands that $0 when highly leveraged is still $0. Avoiding this situation is the first rule.
Jolly good old chap.
I was reading your post and in one second there in front of me was sentence "I use Interactive Brokers to clear my mind" and I said WHAT? Then I reread it. But I'm now laughing as much as I would if you actually wrote it. I don't know maybe the problem is in this decaffeinated coffee that I'm having hour before midnight.
FX you trade FX, r i g h t.
Another in a long line of fine young men driven mad by the four decimal points.
Sad really.
If you trade on an interbank feed, then it's f i v e decimal points. Or should that be: f i v e , 0 ???
I'm confused.
Anyway, good post. Even though you want nothing to do with it, I'm inviting you to the blog anyway.
Five decimal points!!
Do calculators even go that far?
:)
Remember me when you hit the cover of Fortune.
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