Build Your Own Trading Method (Part 1 Introduction)
Meet Harry
Harry just released his trading system on a popular Forex forum. Harry's system works very well for him. He wins 8 in 10 trades with it and has made a lot of pips. He decided to release the system so he could help newbie's make pips.
Meet the Newbies
The newbies just found Harry's system. It's the latest craze and everybody is trying it.
Is the system working for everybody though?
No it isn't.
Why does Harry's system work for him but not so well for others?
- He developed the system and it suits his personality.
- The system suits his skill set and makes use of his strengths.
- He knows the ins and outs and isn't as rigid with the rules.
A trading system is just a tool. What makes it work is the trader behind the system. The trader dictates whether the system works or fails. When you take a tool that a trader custom builds and try to use it in your trading you will likely find it difficult.
Does this make you a bad trader?
No it simply means that you do not have the same skill set as the person who developed the system. It means that you need to develop a system that plays on your strengths and suits your personality.
Why should you develop your own method?
There is no one size fits all trading system. Over the past few weeks I have been asking newbie traders a question:
Q.What do you think is the single most important factor to a traders success?
Not surprisingly most newbies answer 'a good trading system'. It is exactly this mindset that has newbies jumping around from forum to forum looking for the latest Holy Grail system. However, as I have already said there is no one size fits all system so searching forums for the latest and greatest only leads to failure.
To succeed in this market you need to develop your own trading method; a method that works for you and is suited to your personality. To be honest it is not just a simple process it does involve a lot of trial and error but at the end of the day it will make you successful. It is a whole lot better than wasting your time jumping from forum to forum.
Think about it this way. You can run off with the pack, trying ever new system posted on a forum, and always ending up back where you started. Or you can spend that time developing something that works for you; a method that is perfectly tailored to your personality and makes use of your strengths.
After all, 95% of traders fail. So if you run off with the pack and do what 95% of traders do it can only end one way.
In the next article, in this series, I will discuss the difference between a method and a system. I will also discuss the first steps in creating your own method.
Related Posts:
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- 12 Essential Trading Tips to Make You a Pro Trader 21:30 12 October 2008
- Kill Your Losing Streaks 15:57 06 November 2008
- Who is Taking Your Trades? 14:54 22 January 2009
Archived Comments (13)
great words Nick. Teach people how to fish instead of throwing them one
Cool.
*********Full pips ahead**********
EXCELLENT point, Nick... I very much look forward to the rest of this series!
Hi Nick
Until now I learn how to use other people trading systems. I will follow your posts in hope that I will finally learn how to create my own system, which will suit best my personality and my trading hours.
Thanks for sharing your knowledge with us.
Before now idon't even have a trading system or method and i've been looking for a means to do this, i will now look foward to this in other to craete my own whatever.
Great article and am really looking forward to the process you use to develop your own system/method.
Great article and am really looking forward to the process you use to develop your own system or method.
Great article and am really looking forward to the process you use to develop your own system or method.
Great article and am really looking forward to the process you use to develop your own method.
That's GREAT Nick. Keep up the good work.
please can someone help me i'm a newbie looking for someone to builb a simlpe Ea fro me.
i like it, keep it up.
Hi Nick
I love this presentation. If you permit, I wish to include this in my blog.
Most importantly, the point: "He developed the system and it suits his personality".
Healthy And Wealthy Trading
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