London Business School

This allows precise control of new trade opportunities so that their improved chances could ultimately work in favor of the trader. Dan Miller understood the implications. With the reduction of ambiguity, the rules contribute significantly to a sense of mastery and reduce much of the stress associated with high activity of this type of activity. Think about how hard it would move in a lively city where there are no traffic rules! Almost exactly the same emotional state in Many traders, who operate without any rules. The presence of trade rules provide the procedure, as opposed to a chaotic process. However, to ensure that the system served as a psychologist for help, she should correspond to individual traders. A study conducted by London Business School, shows that there is another personal trait – extroversion, which shows a positive correlation with risk tolerance.

Some traders are much more prone to risk than others, simply because of their individual characteristics. It is essential that the system on which you trade, take into account this. Thus, the relationship profits to losses of the system is only one parameter, which should be evaluated by finding the best trading method. Statistics recession and the percentage of winning / proigrshnyh transactions can be crucial to the psychological comfort trader. For example, I found out for myself that I'm much more successful trade on short-term intraday models, rather than large fluctuations.

With an average holding time positions less than 30 minutes, I get a little profits with reasonable consistency, maintaining its concentration on trade and limiting its losses. In my own trading on the indexes, for example, I share every day into four parts: the morning session, noon session, day and night session (Globex) session. Then I assess market trends and sub-trends, measure the degree of institutional buying / selling and looking for testing and advances from one period to the next for intraday trades. Combining a simple decision rule to segmentation of the trading day, I can approach each day with a flexible strategy that does not clog my head. The conclusion is out of hear Traders argue that emotional self-control is the key to profits in the markets. This article suggests that the converse is also true: Strict adherence to a reliable trading rules and systems is one of the most powerful ways to maintain a positive emotional state in the trade. When we act according to the rules, we are in a psychological state that allows efficient perception, problem solving and action. Consequently, training in following the rules during trading rehearsal is an effective strategy for the cultivation of adherence to the rules for trade in real terms.