Importance of Attitude in Trading

Hi all,

I'm about to start day trading for a proprietary firm, and would like to get some forum insights on the importance of attitude in trading.

As a preface, I also just started reading Mark Douglas' "Trading in the Zone", an excellent book on the topic.

His basic assertion is that there is NO single factor that will affect your trading success like your attitude towards the market, and that attitude MUST be very different from the traditional route to success in most fields.

In fact, he states that when most people try to learn about the market, be it learning about technical or fundamental analysis, they do so because they want to avoid the pain of losing, which, due to the nature of trading, will really stifle their success.

What do you guys think? Is the mental aspect of the trading game the most important, or is it skill in technical/fundamental analysis, or some combination of both?

Thanks for any input,


Gordon: I'm sorry, I should have been more clear re: beliefs vs. attitudes.

From the bit of the book I've read so far (about 1/3 of it), Douglas' states that you have to have certain beliefs in order to be a great trader. The first, and most important of these beliefs, is that ANYTHING can happen in the market. You can lose money on ANY trade, no matter how good the setup. He mentions that most traders dont' really believe this, and so enter an unprofitable "pain or euphoria" state when a trade goes a certain way. IF they lose money, they reflect on the loss; if they win, they let it build their ego's.

Douglas says that you have to get past this; to believe that in ANY trade, you have to be ready for anything. And what separates good traders from great is the ability to get out of losing positions quickly, and not let those trades hurt your self image. You were wrong, but it shouldn't hurt, cause the market just moved in one of the three possible ways, so get out of the trade and get in on another one.

Shawn, I just finished reading "The new market wizards" and it seems like most interviews had 2 things in common. The ability to not dwell on a loss(short term memory?) and being prepared for any direction the market moved. There was a game plan put in place for whatever scenerio.