hi, does anybody know books or courses i should read/attend about controlling ones emotions when trading? you see i have two accounts 1 with less money and 1 with lots of money. i can trade trade easily with small money. but when i start trading with the big money account i cant handle the pressure and make big losses.
Read Mark Douglas's Trading in the Zone About R450 at Exclusive Books.You will have to order it . In the book he adresses emotions and how to deal with it . Its not a technical book and it can get heavy in some parts , but its quite good. We all end up reading at some time , so best to get stuck in sooner
2 Practical tips. 1. Try not to look at your P&L during a trade - this will reduce your fear and greed and 2. Keep a trading log of all your trades - every day review your trades for the day against your system and comment on the entries and exits. Your aim is to write Good entry & Good exit against all trades. This will help to focus your attention on the trade and not the P&L.
well how do you select trade size ?? start by finding the amount of money you simple don't care about, say it's R10k .. then use that as you at risk money, in other words how much you would lose if your stop loss was hit .. work backwards to determine how much to buy .. now you have no financially emotional investment in the trade and you can just trade the price ..
Ja, but that solves the easy problem - now how do you keep yourself in the trade & when do you take profits, that is a much harder skill, IMO. Especially if you keep thinking of your profits as current worth, your instinct is to protect it.
Simon, is it just the stop loss amount because what if the market falls so much that that it goes thru your stop loss? If you trade derivates like CFD, is the at risk capital just the margin, the stop loss or the full exposure.
yes just stop loss, which is not the exposure nor the margin .. it is the stop loss amount .. as for falling to much, then you're taking on too much risk; probably with low liquidity, high volatile, gearing, etc ..