Tag: Millions

Trading Psychology to Make Millions

Trading Psychology to Make Millions

Trading Psychology – Introduction

What makes an F1 racing champion? Is it the car? Is it the technology that went into building the engines? No, it is the driver. The driver’s confidence around corners and patience in the face of daunting challenge by other drivers makes a champion. Similarly, it is the trader that makes the difference in stock and option trading. It is the stock or options traders’ confidence in their chosen methodology and their patience in the face of daunting price changes that makes a champion stock or options trader.

Trading Confidence and Trading Discipline are the most important aspects of trading psychology that makes millionaire stock or options traders. They are also the main reason why so many stock and options traders fail and break their bank.

Trading Psychology – Trading Confidence

Trading confidence is a mental confidence banking account in every trader and trading discipline determines if you deposit or withdraw from it. Trading confidence is what enables every stock and options traders to execute trades according to their chosen methodology confidently and to stick to the game despite losses knowing that they will eventually make more wins than losses. Trading confidence is a banking account which you can either deposit to or withdraw from. Each time you lose money, you withdraw from your trading confidence and each time you make money, you deposit to your trading confidence. When your trading confidence is zero or bankrupt, you will find yourself hesitating before every trade while imagining the pain if the trade turns out a loser again. You will have sleepless nights and will rush out of trades at the very first sign of danger, making unnecessary losses. When that happens, it is the time to go back to paper and re-examine the way you have been trading. In fact, you do not have to break your trading account balance to have your trading confidence bankrupt and a bankrupt trading confidence always lead to a bankrupt trading account. Conversely, every time you win money with your chosen methodology, you deposit to your trading confidence bank, feel confident and happy when placing trades and do not panic when trades go bad.

Trading Psychology – Factors Affecting Trading Confidence

A major determinant of your level of trading confidence is the amount and nature of money that you have to trade with. The more money you can afford to lose, the higher your initial level of trading confidence. Stock and options traders whom can afford to lose only very little money would usually have very low level of trading confidence as every loss takes a significant bite out of their trading confidence bank. Again, you need not lose all your money to lose all your trading confidence. Some stock and options traders no longer feel confident enough to trade when their account go down by 30%, while some reach that level of confidence bankrupt only when their account go down by 70%. The nature of money you have to trade with also determines your starting trading confidence. If you are trading with excess money which you do not need, then your level of trading confidence would be very high. In fact, your trading confidence could still be high even if you lose all that money. Conversely, if you are trading with borrowed money which you need to pay back in installment and with interest, your trading confidence would be extremely low as every loss makes it harder for you to pay the money back.

Alas, there is no objective and empirical method of calculating your level of trading confidence and most stock and options traders only understand it when it goes bankrupt.

At this point, it is clear that you need to win money in order to build up a strong trading confidence banking account and in order to win money, you need to follow a proven and successful trading methodology. A losing method will bankrupt your trading confidence in no time no matter how much you start out with.

Trading Psychology – Trading Discipline

Once you are sure that you have a proven and successful method like my Star Trading System, you will need Trading Discipline to make sure you stick to the rules and trade only when entry requirements are fully met. Without trading discipline, you will end up spoiling any successful methodology, leading to a withdrawal of your trading confidence.

Trading Discipline consists of Patience and a Calm, Objective mind.

Every trading methodology trades only when specific setups or rules are met. Without trading discipline, you will not have the patience to wait for such setups or rules to be fully met before trading and every time you break the rules, you increase your odds of losing and every loss withdraws from your trading confidence. Therefore, do not make “fun” or “experimental” trades by compromising rules as losing under such conditions do withdraw from your trading confidence as well.

Trading Psychology – Trading Confidence & Complacence

A distinction must be made here regarding trading confidence and complacence. Complacence comes not from a high trading confidence but from a complete lack of trading discipline. Complacence always leads to a quick and complete bankrupt of trading confidence, so, be certain to understand the difference.

Trading Psychology – Conclusion

Finally, the relationship between trading confidence and trading discipline actually goes both ways. A strong trading discipline following a proven methodology builds strong trading confidence and a strong trading confidence also encourages the development of strong trading discipline as you experience the success coming from following rules. Only when you have both strong trading confidence and trading discipline will you have the trading psychology needed to make millions.

Jason Ng is the Founder and Chief Option Strategist of Masters ‘O’ Equity Asset Management ( MastersoEquity.com ) and author of OptionTradingPedia.com . He is a fund manager specializing in options trading and his revolutionary Star Trading System has helped thousands.

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Donate for Charity and Seek the Blessings of Millions of Helpless People

Donate for Charity and Seek the Blessings of Millions of Helpless People

We all since the time we were in school have been taught this one thing very religiously that, “Charity begins at home”. But, one should not treat it as just another quote as we all should take it very seriously. The need and importance of charity is great and whoever does it should do it with a clean and pure mind.

The person who donates is known as the Donor and the person who receives the donation is known as Donee. The Donee who receives the donation can be a charitable organization or a society that performs the function of charity. Donation for charity should be a selfless act by the donor, where the person donates or gifts cash or other items that are required by the poor and helpless children. Charitable act is something where you donate without expecting anything in return.

In Muslim states or in Muslim community there is great relevance of Zakat. It is a form compulsory payment that is done annually under the Islamic law, in the name of Allah. In this activity, certain kinds of property are used for charitable and religious purposes. But it is emphasized that apart from this Zakat, one also needs to donate for charity. There are a lot of charitable organizations where you can donate your zakat online and help the needy.

When the donation is done to a registered and reputed organization then the donor may get qualified for income tax deductions. There are a lot of organizations involved in the charitable act for children that takes care of the children’s health, education, and try to bring a smile on their innocent faces. If you love animals then you can even donate for charitable animal organizations.

Those people who are willing to donate a part of their earnings in any form, but cannot find the right source or the time to do so can do it online. There are a lot of organizations who have their online site where people can donate for charity and also pay their zakat online. This is a great method for the internet users as just with a few clicks you can do a great act of donation for the needy people and children across the world.

The charitable organizations are doing a great service to the country and the world at large by serving the deprived people of the nation. So if each one of us takes an initiative or a pledge to donate some amount from our savings to the less privileged people of our country, then we too can help them design a better future for themselves.

Visit our website for more information on Donate Charity and Zakat Online.