By: Reynaldo Soriano Jr.
I have always compared trading to martial arts because they are psychologically the same. Like martial arts, there are different levels of trading.
At the entry level, a trader is similar to a martial arts white belt, and has just started searching for the right trading system. The belief of beginners is that after they go to a seminar or read a trading book for the first time, they will soon make lots of money. They are convinced that trading will make them millionaires in a short period of time. Most of them would also like to leave their jobs as soon as possible.
The second level of traders is the blue belt level. This type of trader is learning that trading can be easy or tough. When challenged, they will either persist and keep going to more seminars, looking for the "holy grail," or they will give up and play the victim, saying that trading is "risky." I call this the break-out stage. They either remain or leave.
The third level of traders is the black belt level. These traders start to realize that psychology plays a big role in trading. They also start to learn more about themselves. They begin to perfect their trading skills systematically and psychologically.
The fourth level of traders is the master level--the highest level of trading. When they trade, they are at one with the market physically, psychologically, and spiritually. They feel the market and they have no fear. They control their emotions when challenged and they take full responsibility of their own actions. In ancient Japanese, this is called Mushin.
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At the entry level, a trader is similar to a martial arts white belt, and has just started searching for the right trading system. The belief of beginners is that after they go to a seminar or read a trading book for the first time, they will soon make lots of money. They are convinced that trading will make them millionaires in a short period of time. Most of them would also like to leave their jobs as soon as possible.
The second level of traders is the blue belt level. This type of trader is learning that trading can be easy or tough. When challenged, they will either persist and keep going to more seminars, looking for the "holy grail," or they will give up and play the victim, saying that trading is "risky." I call this the break-out stage. They either remain or leave.
The third level of traders is the black belt level. These traders start to realize that psychology plays a big role in trading. They also start to learn more about themselves. They begin to perfect their trading skills systematically and psychologically.
The fourth level of traders is the master level--the highest level of trading. When they trade, they are at one with the market physically, psychologically, and spiritually. They feel the market and they have no fear. They control their emotions when challenged and they take full responsibility of their own actions. In ancient Japanese, this is called Mushin.
[Read full article]
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