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The Definitive Guide to Mastering the Psychology of Trading by Mark Douglas
ok thanks grausch - my question was actually a bit provocative - that's the reason I tend to use the 25 trades rule, i.e. a reasonable (not too small but not too large) sample to indicate whether something is working or not.
I agree though that if I were entirely trading mechanically I would definitely looking to backtest something over a period as large as possible.
Thanks also for your recommendation. I am a huge fan of Mark Douglas, simply because of the concepts he wrote in Trading in the Zone which I personally regard as a 90% psychology/10% trading book, or at least that's the value I place on the book's contents, so I'll definitely give this one a go as well at some point.
Trading: The one I'm creating in the present....Index Futures mini/micro, ZF
Posts: 2,311 since Nov 2011
Thanks Given: 7,341
Thanks Received: 4,518
I would just like to say that back testing does not and can not equal live trading and is a separate skill apart from trading either mechanical or discretionary. But it does have value. And that even a mechanical trading system still involves some degree of discretion. For example you choose to turn it on and you turn it off at your discretion and or make other adjustments depending on your perceptions.
Ron
...My calamity is My providence, outwardly it is fire and vengeance, but inwardly it is light and mercy...
The steed of this Valley is pain; and if there be no pain this journey will never end.
Buy Low And Sell High (read left to right or right to left....lol)
And does it rally matter ? What matters, are his teachings right or wrong ?
Phil Jackson won 11 NBA champions as head coach. Could he have been
5th player on court next to Jordan, Pippen, Rodman ? No.
"Trading in the zone" is the best book about trading in my eyes.
Mark was a self-admitted failed trader. He said so in the preface to Trading in the Zone. He made his money writing and consulting. Does it matter? I guess it depends what you get out of his books. If you find value in his writings then it doesn't matter. A lot of people cite Trading in the Zone as one of the best books ever written about the psychology of trading so I think his work stands on it's own regardless of his own trading success.
Trading: The one I'm creating in the present....Index Futures mini/micro, ZF
Posts: 2,311 since Nov 2011
Thanks Given: 7,341
Thanks Received: 4,518
I think perhaps a closer examination of the book Trading in the Zone and Mark's other books, for sure The Disciplined Trader, is in order. For example page 13 of The Disciplined Trader top of the page, quoting Mark's work on this page.....
"By June 1982 I was starting to make consistent money for my customers who relied on me for their trades. Not a lot of money by most trader standards but steady. I was having winning days that were turning into winning weeks and months. Then sometime in August 1982 I thought of writing a book or at the very least developing a seminar to explain to other traders what I had discovered for myself."
The first edition of The Disciplined Trader was in 1990.
I feel maybe you did not read enough of Trading in the Zone and none of The Disciplined Trader. Many many traders have failed attempts at trading. Mark was one of them. Thank you Mark. Because of it he discovered an entire field in the trading world, traders psychology and wanted to share it. As well as became consistently profitable.
I lost $50k in this business. Glad I did. A drop in the bucket in the scheme of things.
I was lucky enough to have met Mr Douglas. All I can say is I believe him. I can't prove to you with his account statements. But I can tell you he poured his heart out. Writing he said was extremely hard for him. He did not use references and other peoples work to compile a book. Just turn to the back of his books and look for a bibliography, which he pointed out it lacking. He asked sincere questions of himself (sincere is the operative word here in a huge way) and gradually got his answers. Took a long time to complete his books due to this process.
The entire reason he stopped coaching traders officially as part of his business is because it took him away from his own trading. So yes he traded and yes he was profitable. It's kind of like saying Sir Isaac Newton did not know math but just invented Calculus and Newtonian Physics.
Ron
...My calamity is My providence, outwardly it is fire and vengeance, but inwardly it is light and mercy...
The steed of this Valley is pain; and if there be no pain this journey will never end.
Buy Low And Sell High (read left to right or right to left....lol)
Trading: The one I'm creating in the present....Index Futures mini/micro, ZF
Posts: 2,311 since Nov 2011
Thanks Given: 7,341
Thanks Received: 4,518
WOW......lol.... not sure what to feel flattered or upset.....lol.....
....but alas life is to short.... But please stop it @Marc Abell. It only hurts you.
I removed my Thanks from his post. When I read it I was like ...YEAH! Right On, WOW I love how this guy thinks......lol
(And by "hurt" I do not mean it in the traditional way some are going to take it ...more of like a dis-ease of the psyche. I can explain further if I need to.)
Ron
...My calamity is My providence, outwardly it is fire and vengeance, but inwardly it is light and mercy...
The steed of this Valley is pain; and if there be no pain this journey will never end.
Buy Low And Sell High (read left to right or right to left....lol)