- August 30, 2016
- Posted by: CoachShane
- Categories: Basic Trading Strategies, Trading Article, trading videos
Ever hear that if you want a meaningful answer, you need to ask the right question?
Asking questions in a general way will give you an answer that is not actionable.
That is what you are looking for though.
You want an answer that will give you a way to start moving forward and the way to get that is to wrap your mind around asking a more specific question.
Wrap Your Mind Around Specifics
The average person will ask, “How can I make more money?”
Those who succeed ask “How can I average 15-20% per year on my investment and lessen the tax burden?”
The average person will ask, “Why can’t I lose weight?”
Those who succeed ask, “How can I decrease body fat while maintaining muscle mass without a starvation diet?”
The average person will ask, “Why does this always happen to me?”
Those who succeed ask, “How can I use this challenge that I face to better myself?”
Both questions are looking for the same type of answer but only one of them zeros in on being more specific.
Which one do you think will give you something that you can move forward with?
Same Challenge But Different Mindset
They are the same issues but approached with a different mindset. Many questions we ask ourselves, even as we speak to ourselves with mind chatter, are generally not of the empowering kind.
That is human nature.
I firmly believe that those who succeed speak to themselves and ask questions much differently than those that are merely average.
Average is fine, however I can’t recall anybody in my life saying they never wanted to excel.
You are what you eat, right? Well, I think you are also what you think!
Read any autobiography of anybody who has accomplished something that most do not and they will tell you exactly that.
Your Mind And Trading
So…what does this have to do with trading? A ton.
Mindset is huge in trading, although this article is not about all the things that make up a successful trader’s mindset. No, I want to talk about the questions you need to ask… actually NOT ask (at least at first) in order to determine a trading system you will investigate further.
Netpicks receives a lot of trading questions and a lot of them are questions where the answer won’t truly have much meaning.
These are the types of questions that support will receive when people ask about trading strategies:
- On average about how much do you make per contract per day?
- How long do you trade usually per day?
- How much do you recommend putting in your account per contract?
These questions are actually useless.
What difference does it matter how much I make per contract? So much has to do with your ability to trade the systems, the trading plans and your tolerance for risk.
I always come back to the Turtles where everyone was taught the exact same method in the exact same fashion.
They saw widely different results among each trader. Looking at personal results has no bearing on your success or failure.
Bottom line: understand that this type of information will not help you.
1. How much time trading?
This question probably ties in with how much made per day. This person is obviously trying to piece together how much and how fast.
Someone new to trading a certain method cannot expect to come close to the results of someone who has experience with the method.
They can’t expect to mirror the results of someone who has dealt with the emotions that come from taking a string of losing trades.
Length of time trading is a general question that does not take into account a trade plan that say, may quit after one loss. There were no specifics asked but even if they were, how can you evaluate a system based on that question?
2. How much to have per contract?
The recommended amount per contract is getting close to a decent question. Obviously, the more capital you have per contract traded, the lower your risk per trade.
However, this question is not very helpful because it does not take into account the tolerance for risk. It also does not take into account a very important number… average risk per trade.
3. Monetary goals are not a great goal for beginning traders.
The final mention in the email was not a question… but a statement: “Goal was to make 1 point or $50 per contract per day and that is not enough for me.”
I am not making fun of this person. The sad fact is that these questions are the usual types of questions asked! It points to the fact that many people are approaching trading with a mindset that is not conducive to success.
Questions That Matter
Where are the questions about risk? Expectancy? Exits? Anything that digs into the risk factor associated with the method?
People considering trading as a career really should avoid forums because that is where many of these questions are asked.
Pick up a trading book by Douglas or Van Tharp. Pick up the Market Wizards books. Pick up anything written by successful traders or those associated with them to see how these people think.
Find out how these people ask questions.
It is not by accident that most people fail. They are not prepared to ask even the most basic questions. They have not searched out the mind mechanics behind trading.
I urge you, before even thinking of a trading system, dig deeper and think like a successful trader when determining your motives and bench marking your performance. Your future success really does depend on it.