How to day trade

How to day trade

1. Chapter 1: Why do most traders fail?

   • The hunt for the Holy Grail
     • holy grail syndrome
       • must not focus on your percentage of success, but on your profit loss ratios
       • fear of loss
         • It is a fear so strong that it motivates these traders to search endlessly for that perfect strategy in hopes of preventing them from having to experience any more losses.
         • searching a perfect strategy to prevent loss exp.
       • follow other traders trade for trade
       • Jumping from strategy to strategy
       • TIP: must not focus on your percentage of success, but on your profit loss ratios
   • Profit loss Ratios
     • 2:1 PLR = 50% success rate
     • - PLR is 1:2 PLR must have 75% success rate
   • Fear of Loss in Trading
     • Fear of Financial loss
     • Fear of making a big move in the market
   • Holding Losers Too Long
     • Hold their losers too long
       • they think it's not a loss until you hit the sell button
       • Emotional state
       • small losses are not a big deal
         • Cap your losses
       • Sometimes they make it worse by averaging down
   • Selling Winners to Soon
     • Fear of loss Guided their decision
     • Small winner turning into a loser
     • Forming a habit of capping your winners instead of the opposite
     • Failing trader
     • TIP: Scale out
   • Embrace loss as a part of the business
     • To be a Good trader means being a Good loser
     • Cap your losses and stick with it
       • A trader with 90% success rate was still losing money for not capping his loss
   • Discipline as a Practice
     • 30mins of exercise and 15mins of meditation
       • Strengthen mind and cope with stress