Why is it that some people are successful in trading the markets? And why is it some people fail? Is it luck that determines if you are successful or not in making money from the market? Is it the system or strategy that a person use which determines their success?
A lot would say it is the system or system that they employ which at last figures out whether they come out winning from the market.
Each system that exists on the web will show you how to make a little cash using it. Without question, it’ll make money for you. The issue is sometimes how much money will the system make for you. All of the system that out there will show to you how their system has work base on historic information or activity and then at the base of the page there would be a disclaimer clause that states ‘..Historic information doesn’t identify or guarantee future earnings….’
So why is it that these sites or page include this disclaimer clause?
The disclaimer clause is incorporated in it because they understand that there are elements which they can’t control. Human feelings. Human feelings are always the key to either success or failure in any business. And it’s no difference when trading the markets. Read all of the books about trading that you need, buy all of the successful system that you need. If you are unable to control your feelings, you cannot achieve success in the markets.
That is the cause of the disclaimers clause as the one thing the writer can not control is their customers or purchasers feelings. In the market there are but just two main feelings that each trader will experience ; fear and greed.
When this emotion appears it is not how we eliminate it but rather how we act on it. There are natural emotions that can not be eliminated. This emotions forces us to action, thus how we act on it will determine the outcome. Like anger, when we are angry at someone, it’s either we say something nasty or we can just kick a bucket or we can just dive into a pool of water. Which ever action that we take, it produces a different outcome or result. All too often when we begin to see two to three consecutive loses on our trading activities, we would begin to have doubt. When this happens we are already at the state of fear, we fear losing more of our money and thus begin to doubt that the system is working. While no system is absolute, meaning no system will guarantee that you will make money ALL the time. The system seller would say that we would be able to make money consistently, provided we follow their system to the dot.
On the other hand, when we begin to see two or three consecutive we begin to feel on top of the world. We begin to feel that we can start making good money from the market and then start tweaking the system or maybe putting more money in the market to leverage our earnings or maybe begin to take on more positions, which ultimately make us deviate from the system which we were using. This is when greed has already stepped in to rule our thoughts. There is saying ‘The system is only as good as the person using it’.
So if we do not follow the system either with we are making loses or when we are making profits. We might at last fail. And to follow the system needs discipline. The willpower to act on our greed and fear when it sets in, will figure out how well we do in the market. Once more discipline is the key. We must have the willpower to say ‘I have reached my target. I should take profits now although it may go higher’ when greediness sets in. And when fear sets in one should say ‘I have to take a position although the market does not appear to be moving in my favor’ While these are but 2 circumstances when greed and fears emerges, there are, and will most likely be many examples when we want to make a call to either leave or enter the market. And these are awfully 2 most vital choices to take to succeed in the markets. The wherewithal to follow the system diligently regardless of what happens to the market.
So no matter how good the system is, the only and sure way is to lasting success in the market depend on the discipline to overcome our personal emotional to follow a particular system religiously.