The Big Win

Today I’m sharing some good ideas from Brian Lund.

Brian presents an interesting personal history behind this post, and it is enjoyable reading. For our purposes, the following excerpt represents the important part of the post

As a virgin trader that same lack of context existed. I thought that making money in the markets was easy. That it came without studying charts. Without learning risk management. That I could just roll out of bed on Sunday, read some stories in Barron’s, and with that pick stocks that would allow me to retire before I was thirty.

But just like in life, that is not the way the markets work. They may temporarily reward the lazy, the egotistical, and the unprepared, but right when you are about to crown yourself the next Paul Tudor Jones, your bill will come due, with brutal interest.

The worst thing that can happen to any new participant in the market is for them to make a shitload of money on their first trade. It sets them up with a false confidence that can drive them to trade bigger and bigger until such a point that they have all their discretionary capital at risk, and that is when, not unlike the “sevening out” in craps, the markets will wipe them out.

If you begin trading with a winning streak, please understand that you are not (yet) a star trader.

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