CCK's Keys to Successful Trading

by ckchoy

We have heard a lot of topics related to Keys to Successful Trading, either through attending seminars, books, internet sources and so on. How to make XXX amount of money from a short period of time through market. So many versions, so many patterns, so many mindsets and so many stories until so confusing. So what are the 'real real' keys. Can we simplify all and draw a conclusion?

Let me share with you CCK's version of Keys to Successful Trading. Again, this is not a model answer, and let's first try not to focus on whether this is right or wrong to draw such conclusion. This is my experience that I would like to share.

Let's start. So... what are the keys?

1)Method?
It sounds like this is a very basic start, as we all need to have a/some method(s) to follow so that we know when to enter and exit. Methods can be TA ( Technical Analysis ), which TAs you apply? Eg Moving Average, RSI, trend, support/resistance and so on; can be FA ( Fundamental Analysis ). Yes it is one of the key. But can we say that if we have solid methods then we sure will make money consistently? No there are chances that we will still lose money, not only small amount, it could be big, bigger then what you made before, and so on. It could be your methods are right but somehow at that time other factors come in, like major unexpected news against your trade, human emotions change, or what we call, no luck.

2)Skill?
It sounds better and it is the second level of requirement of successful trading. Skill can be the ability to read TA charts, the knowledge to read FA reports, the experience to read first hand news as soon as possible, the fast reaction to key in your orders and so on. Yes skill is also very important, but same thing, it is not foolproof. There could be more people that are skilful than you, and it could be the luck not there.

3)Experience?
Aha...sounds logical and common sense? No matter how solid the methods we use and how skilful we are, time will tell whether that will ensure a consistent profit, so experience is important right? The more experience ( the older we are... ha ha) we have the higher chances of successful trading? Ginger the older the spicier. Finally we found the answer? No, if it is true, then the more trading experience a person has, the more profit he will make, but we know it is not necessary true. In fact, past experience is just as good as a past reference. You can show me past 1 year, 2 years or 10 years trading profit, but they still cannot be used to project your next year profit and future profit. Future is always unknown. Yesterday you make 100 buck doesn't mean tomorrow you sure will make 100 buck and doesn't mean you will not lose. Last year you make XXX amount of money may not mean this year you can make XXX amount of money and will not lose. Even though you show last 10 years record, also cannot predict your 11th year profit/loss.

It is same as a past TA chart is only as good as past reference, if it can 100% predict future trend, then everyone will make money consistently using past data.

So tired and waste time reading so many nonsense still can't get the keys?

4)Discipline!
You have heard of money management is important, how trading psychology works, how we can control our emotions to successful trading. Yes they are true, but you need a key thing to follow them consistently - Discipline. We may not be able to know the trading outcome, ie win how much or lose how much, but with discipline, at least we can control and minimize the loses hence protecting our capitals. 留得青山在，不怕没柴烧

5)Luck!
This sounds so funny, ridiculous and nonsense. Don't you tell me after we learnt up so much and so many things now you want to tell me all because of luck? So might as well we learn nothing and pray for luck? I don't mean we should stop learning, instead we should keep on learning but don't forget luck is a key.
Yes, it is very true, most of the time we need luck to standby us, especially how much we can win from the market. We can't decide and control how much we can make, but let market show us. For example, if today's market is in a very tight range bound, don't die die say must make 20% today. If today's market swing fast like a roller coaster or has a very strong trend, you thought of making 30% is enough, market may give you 100% or 200%, so don't any how demand from market and don't underestimate market.

Conclusion
Let's simplify - yes CCK's experience tells that the keys are Discipline and Luck.
I understand most can accept Discipline is important and it is a main key but not many can accept Luck.
But let me tell you this and you will feel better to accept Luck is important and good.
If we win money from casino, most of us will agree it is all because of luck and will not bother much to risk ourselves more and expose big to our betting.
But how about we somehow can win consistently from market through trading? Many of us will start to think we are the king of trading, and so confident that we start to multiply until overcommit. I can tell you, there is no Guru and expert in trading but only winners and losers. Either you are a winner or a loser, that's it. Don't grade yourself so many different kind of levels like what novice lar, amateur lar, what experience lar, what expert, what Guru, what God of the market, what legend lar... you only make yourself more confused and most importantly, make your ego control you.
Everyday I'm a fresh student of market. Accept Luck as a key factor so that we can stay humble and market will reward us.