Trading System

The trading system gives the trader the ability to control his or her emotional states rather than allowing them to control him. A system is a disciplined method for organizing dynamic, ever-changing market phenomena.

Howard Abell

Do Not Play Catch Up

I learned to avoid trying to catch up or double up to recoup losses. I also learned that a certain amount of loss will affect your judgment, so you have to put some time between that loss and the next trade.

Richard Dennis

Accept The Risk

To whatever degree you haven't accepted the risk, is the same degree to which you will avoid the risk. Trying to avoid something that is unavoidable will have disastrous effects on your ability to trade successfully.

Mark Douglas

Don't Optimize Trading Size

Trading Size is one aspect you don't want to optimize. The optimum comes just before the precipice.

William Eckhardt

Good Money Management Alone Is Not Enough

Good Money Management alone isn’t going to increase your edge at all. If your system isn’t any good, you’re still going to lose money, no matter how effective your money management rules are. But if you have an approach that makes money, then money management can make the difference between success and failure.

Monroe Trout

Do Not Play With Your Trading Losses

These evidently instinctive human tendencies spell doom for the trader – take your profits, but play with your losses.

William Eckhardt

Have An Open Mind

It’s not what we don’t know that hurts us; it’s what we know for sure that just ain’t so.

Mark Twain

Success Rate Of Trades Of Least Importance

The desire to maximise the number of winning trades (or minimise the number of losing trades) works against the trader. The success rate of trades is the least important performance statistic and may even be inversely related to performance.

William Eckhardt

Nothing New In Trading

That enormous profits should have turned into still more colossal losses, that new theories should have been developed and later discredited, that unlimited optimism should have been succeeded by the deepest despair, are all in strict accord with age-old tradition.

Benjamin Graham

Immerse Yourself In The World Of Trading

"Understand that learning the markets can take years. Immerse yourself in the world of trading and give up everything else."

Linda Bradford Raschke

How Much Do You Make When You Are Right?

I have learned many things from him (George Soros), but perhaps the most significant is that it’s not whether you are right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.

Stanley Druckenmiller

Simple But Not Easy

Investing is simple, but not easy.

Warren Buffett

Losses Hurt

If the losses don’t hurt, your financial survival is tenuous.

William Eckhardt

Markets Are Not A Random Walk

The markets are clearly not a random walk. The markets are not even efficient because that assumption implies you can’t make an above-average return. Since some people can do that, I disagree with the assumption.

Monroe Trout

Markets Are Based On Human Psychology

The essential element is that the markets are ultimately based on human psychology, and by charting the markets you’re merely converting human psychology into graphic representations. I believe that the human mind is more powerful than any computer in analyzing the implications of these price graphs.

Al Weiss

Trading Philosophy Acquired Through Time And Effort

A trading philosophy is something that cannot just be transferred from one person to another; it’s something that you have to acquire yourself through time and effort.

Richard Driehaus

Psychology Do Not Change

Opportunities change, strategies change, but people and psychology do not change. If trend-following systems don’t work well, something else will. There’s always money being lost, so someone out there has to win.

Gil Blake, New Market Wizards

Losses Are Part Of Business

Wanting to make money in the markets without accepting there will be losses is like waiting to breathe but only wishing to exhale.

Ed Seykota

Be Ready To Correct Errors

My sense of insecurity keeps me alert, always ready to correct my errors.

George Soros