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WHAT is trading anyway?What is trading? You know what trading is but here's a reality check: An art or a science?
Sounds good? So what is trading? As humans we have a natural tendency to try and influence our surroundings and events we take part in. We have to realize we have no control over the market and if we accept that then we have to accept that we can not influence the direction of the market. The problem of course is we have a tendency to try and succeed and when inevitable losses come it is easy to let those losses effect us emotionally. Becoming euphoric when you hit a winning streak is almost as detrimental as becoming depressed when you have a string of losses. We have to try to achieve a state of impartiality. We have to accept that we will have losses as readily as we will gains. Reaching a stage where you can comfortably accept losses, in the knowledge that your method of trading will produce profits in the longer term is the state we have to aspire to. Remember to never ever equate your success or failure in the markets with who you are as a person! See the market as a bully; you can’t win by fighting him, you can only be wiser… One other reason some people don’t make it in the trading game and probably the hardest for some people to own up to is some people are just not meant to be traders. One of the reason for this chapter "what is trading" is to make you realize that once you finish this course you should take some time and ask yourself if this is really what you want to do. It might be a decision which saves you thousands of dollars! Here’s the good news! Once mastered, it can be a rewarding activity both financially and emotionally. It can give the financial independence to never work for a boss again and you will learn lot about yourself as a person on the way to becoming a trader. Now I need to warn you: The next few paragraphs of "what is trading" are going to be brutal and might even seem redundant given what you just read but you need to understand these important facts about trading! (Don’t worry, it gets better… ) Here we go: 90% of all traders go BUST! Some source go as far as stating that 99% lose their initial starting capital and even that 10% actually go bankrupt! WHY? The main reason is a flagrant lack of education. BTW, stats show that most traders are actually well educated, have above average income and are generally highly motivated… By education, I don’t just mean learning how to read a level 2 screen chart or draw lines on a chart. I mean thoroughly educating yourself in all aspect of trading:
This friend is where I hope to be of some help. I don’t have all the answers nor do I profess to be some kind of guru, but I will do my best to point you in the right direction. Remember: Been there done that... Since then I really asked the question: What is trading and as simple as this question looks the answers are not that simple. Here are some of the common misconceptions about trading:
What’s the reason that so many believe trading is an easy way to make money? Propaganda! Based on all the publicity out there, you’d think anybody can become financially independent within a few weeks using a system that doesn’t require trading knowledge! Think again my friend! Have I scared you yet? I hope I did because trading is really a dog eat dog world! My hope is that you take the time to absorb every single word I throw at you and read it again until you have a good handle on the material. If you feel you are unsure about a certain topic, read it again and if you remain puzzled, Google the topic and read about it until you are comfortable. And ask YOURSELF what is trading for me. Think of it has building a house. You wouldn’t skip the foundation stage would you?
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