I don’t think I really need to say much other than this is Part 2. If you listened to Part 1 (episode 171), then I’m sure you are ready to go given the cliff hanger we left you at. So with that being said, let’s pick back up with long time community member Paddy in his wild trading journey.
After having a successful four days and going into the last trading day of the week, Paddy unfortunately gave back all his profits and then some. This led to some screaming and a visit from some folks walking by to check what was going on.
Paddy was able to identify pitfalls he had in his mentality. Being a competitive person does not help you as a trader since it sometimes makes you break rules. There needs to be emphasis on adhering to the plan whether it is profitable or you stop out.
The mental side is what Paddy is currently focusing on. He attributes this to why people either follow their trading rules or break them and generally end up feeling the pain. This is partially why he decided to trade options instead of equities.
Patience is key in all things related to trading. Patience with the trade, the journey, the failure, the accumulation of experience.
I was up 400 on the week and I woke up on Friday and said ‘just don’t blow your week.’ In 30 seconds, I had blown my week.
The biggest challenge I’ve had to overcome is that you have to be able to take small losses.
Options give me defined risk. If you put 2,000 on the line and those options expire worthless, that’s all you lose.
If you can’t control yourself, having an automatic fail safe is going to save you.