Traders' Roundtable

Doug Hirschorn posted "13 Trader Resolutions for 2010" on a blog for CNBC. I thought it was worth passing on:

1. I will create game plans for all my trades.
2. I will only trade when I have an edge.
3. If I have 3 losing trades in a row, I will take a break, walk away, and clear my head.
4. I will never trade for revenge.
5. Any time I'm hoping, wishing, or praying, I will exit the trade immediately.
6. I will never give back more than half my profit on any trade.
7. I will keep a daily trading journal and email it to someone who will hold me accountable.
8. I will think in terms of probabilities and risk/reward.
9. I will remain objective in my trades by asking, "If I had no trade on, what would I do?"
10. I will never put more than 20% of my capital at risk in any single position.
11. I will not make trades just because I'm afraid to "miss out."
12. I will quickly recognize my emotions and compartmentalize them raither than waste time trying to get rid of them.
13. I will trade to make money, not to be right..

#6 might be a little to conservative, and #10 might be a little aggressive, but a good list to ponder nonetheless.

Don't know Mr. Hirschorn - his Lucky 13 huh?

I've heard apple pie tastes good to - maybe his 13 resolutions (aren't they supposed to be made a little over a week from now?) can be summarized as "be professional" with the exception of #10 which sounds like a quick way to the poor house.

If you like this sort of thing, here is one attached which summarizes the results after interviewing 500 futures brokers on why their clients lost money. The kitchen sink is in there somewhere I think...

Regarding number 10, he probably meant he would never commit more than 20% of captial to a single stock, which he may have a stop at 10% of the position's value (or 5%, or whatever)? which translate to a 2% or 1% position size and is thus not a quick way to the poor house.

TrendsCatcher wrote:Regarding number 10, he probably meant he would never commit more than 20% of captial to a single stock, which he may have a stop at 10% of the position's value (or 5%, or whatever)? which translate to a 2% or 1% position size and is thus not a quick way to the poor house.

Probably right - as a futures trader only I keep forgetting about the equity trader POV.

cjo5039 wrote:Doug Hirschorn posted "13 Trader Resolutions for 2010" on a blog for CNBC. I thought it was worth passing on:

1. I will create game plans for all my trades.
2. I will only trade when I have an edge.
3. If I have 3 losing trades in a row, I will take a break, walk away, and clear my head.
4. I will never trade for revenge.
5. Any time I'm hoping, wishing, or praying, I will exit the trade immediately.
6. I will never give back more than half my profit on any trade.
7. I will keep a daily trading journal and email it to someone who will hold me accountable.
8. I will think in terms of probabilities and risk/reward.
9. I will remain objective in my trades by asking, "If I had no trade on, what would I do?"
10. I will never put more than 20% of my capital at risk in any single position.
11. I will not make trades just because I'm afraid to "miss out."
12. I will quickly recognize my emotions and compartmentalize them raither than waste time trying to get rid of them.
13. I will trade to make money, not to be right..

#6 might be a little to conservative, and #10 might be a little aggressive, but a good list to ponder nonetheless.

I think almost all of these are completely moot points from the point of view of a mechanical systems trader.

#14 Remember to keep office door closed so cat can not walk on keyboard thus causing random trades in various markets. So far over the past year, he's up handsomely. But I fear the long term consequences!

cjo5039 wrote:Doug Hirschorn posted "13 Trader Resolutions for 2010" on a blog for CNBC.....

Here are three of Buffett's rules:

1. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
2. The stock market is designed to transfer money from the active to the patient.
3. The most important quality for an investor is temperament, not intellect.

RedRock wrote:#14 Remember to keep office door closed so cat can not walk on keyboard thus causing random trades in various markets. So far over the past year, he's up handsomely. But I fear the long term consequences!

I completely sympathize Redrock. What is really demoralizing is when my cat's CAGR was beating mine - I had two - they could pyramid in oh so clever ways. Those key-paw-tapping ways are to be discouraged and dealt with harshly.