Stamina of a Marathon Runner

Yes.

That’s what a small entry quantum approach demands of its player.

To be frank, I’ve not run any marathons on field and track.

However, I’ve done my share in life, and continue to do so. 

If it’s not a marathon, I don’t get a kick.

If you’ve got that in yourself, you’re cut out for the small entry quantum approach.

There’s repetition.

Boredom.

The long-haul.

Life in the background.

No hype.

Going on and on…

…till you break through,…

…and the contents of your portfolio spill over…

…and start to show.

Might take a few decades. 

Do you have it in you?

What will make you hold out?

Stick to the tenets of the small entry quantum approach, and you will not only hold out, but your folio will burgeon too.

Buy with surplus.

Buy with margin of safety.

Learn to sit.

Enter small. Many times.

Keep entering over the years, till there is reason to enter.

Exit on highs. Only get rid of those stocks you don’t feel like holding anymore.

No fear please. Kill it. Create the circumstances for fear to vanish.

No euphoria either. That’s a tough one, especially when the whole world is dancing around you. 

Do your homework. 

Don’t listen to anyone.

You’re set.

 

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Nath on Trading – III – Meat in the Middle

41). If it’s high, it could go higher.

42). If it’s low, it could go lower.

43). Market forces tire the trader.

44). Engulfment in loss and loss-freeze suck one out.

45). That’s exactly why we’re not going to let that happen. You know how. (Hint : stops).

46). Trade selection is the least of one’s problems. It’s no biggie.

47). Trade management separates winners from losers.

48). Proper trade exits are the icing on the cake.

49). Longs exiting in a rising market – hmmm – really?

50). Shorts exiting in a falling market – hmmm – really?

51). What’s that other fellow trading? Who cares?

52). How’s that other fellow doing? You got it. Who cares?

53). The only entity stopping you from outperformance – is you.

54). All your demons – are in you.

55). They’ll slowly come out, over the years, one by one, or some now, some later. Hopefully sooner than later.

56). Let them emerge, show their antics, and disappear forever. Make sure you bid them goodbye.

57). That’s why, you’re trading small, right, till your demons have emerged, created havoc, and then disappeared, forever?

58). You’ll feel it from inside, when it’s the right time to scale up. Develop this dialogue with yourself. A clear voice emerging from within can carry great advice.

59). Sure, you’re looking at trade signals, and sticking to trade rules. However, the voice from within is the net resultant per saldo vector of your entire trading experience. It carries weight.

60). Mostly, it doesn’t come. Clear the way for this voice to make itself heard when you need to listen to what it has to say. Trading, at first, is a bunch of rules. Later, trading becomes an art.

Nath on Trading – II – Building up on Basics

21). You started small, right?

22). Ultimately, you’re staying consistently in the green, correct?

23). Then it’s time to scale up. Slowly does it.

24). Why the whole spiel about starting small? You make your biggest mistakes in the first seven years.

25). Hopefully, you don’t repeat a mistake once it has happened, and once you’ve learnt from it.

26). However, mistakes are good, because they teach you. Nothing else can teach you with incorporation into DNA. Mistakes can.

27). No university can teach you. No books. No professor. Play the market, make the mistake, and learn.

28). A big break early in the markets is a recipe for disaster. More likely than not, you’ll blow up later, when it matters.

29). The best possible way to scale up is using position-sizing as delineated by Dr. Van Tharp.

30). The good thing about position-sizing is that it makes you scale down, when trading corpus goes below par.

31). Day trading takes up the day. You’re exhausted and are not able to do much else.

32). Short-term trading also keeps you riveted to the terminal, mostly.

33). However, position trading and longer time frames keep you in the line for whatever else you wish to achieve.

34). Market TV makes it a video game. Switch it off.

35). Trading with targets caps big-win potential.

36). When you trade, you trade. You don’t invest.

37). Successful trading means buying high and selling higher, or…

38). …selling low and buying back lower…

39). …as opposed to successful investing, which is buying low, not selling for the longest time, and then selling for a multiple.

40). Read points 16 to 19 again.

Nath on Trading – Basics Win

1). Put yourself out there. Again and again. Take the next trade.

2). Keep yourself in a position to take the next trade. How?

3). Take small losses. Have a stop in place. Always. Have the guts to have it in place physically.

4). Trade with money that doesn’t hurt you if it’s gone.

5). Don’t exhaust stamina. Put trade in place with smart stop that moves as per definition, and then forget it. 

6). Keep yourself physically and mentally fit. Good health will make you take the next trade. Bad health won’t.

7). Have a system…

8). …with an edge, and even a slight edge will do.

9). Keep sharpening your system. 

10). Don’t listen to anyone. You’ve got your system, remember? Sc#@w tips. God has given you a brain. Use it. 

11). Let profit run. Don’t nip it in the bud. PLEASE.

12). A big profit doesn’t mean you’re it. It can become bigger. And bigger. Remember that.

13). What’s going to keep your account in the green over the long run are the big winning trades. LET THEM HAPPEN. How?

14). You exit when the market stops you out. Period. Your trailing stop on auto is fully capable of locking in big gains and then some.

15). Similarly, make the market make you enter. Entries are to be triggered by the market. Use trigger-entries on your platform.

16). When a trade is triggered, you’re done with it, till it’s stopped out, in profit or in loss. Can you follow that?

17). Your trade identification skills are going to improve over time. Get through that time without giving up. 

18). Despair is bad, but euphoria is worse. Guard yourself against euphoria after a big win. Why?

19). Big wins are often followed by recklessness and deviations from one’s system that is already working. NO.

20). Use your common-sense. Is your calculator saying the right thing? Can this underlying be at that price? Keep asking questions that require common-sense to respond. Keep your common-sense awake. 

 

 

 

Robotic Stock Selection Anyone?

No…

…thank you…

…is it?

Sure, stockscreens.

We use them all the time. 

A stock screen is a robot.

So why am I still saying no thank you?

I use stockscreens day in and day out.

I use them for trade selection, and I use them for long-term stock selection.

However,…

…(here comes the hammer),…

…the final say is mine. 

I’d like the human touch to answer yes or no.

Also, out of say a hundred selections, I can still say no to all.

And, if something catches my eye, I can dig deeper. 

I’d like to keep all these things in my hand.

I’d like my market approach to be with open eyes and usage of common-sense.

So where are we exactly?

Somewhere between one-fourth and half robotic.

That suits us. 

We save hours of sweat labour.

After sweat labour has done its work, we start applying our minds. 

We take over where the robot has left off.

Uff, sometimes it’s so boring, that…

…you find yourselves asking,…

…was that it?

Aha. 

Need I remind you, that this is very good indeed?

You want your strategy to become to streamlined, that it’s outright sheer damn boring. 

That’s exactly when the strategy will perform.

Thrill-seekers have a video-game experience of the markets and then burn out. 

You will go on and on with your boring strategy. 

What does this mean for your time?

You’ve got something streamlined, so you’ve got time on your hands. 

Twiddle your thumbs, or do something new. 

I’ll take new. 

I’d go for another strategy. 

Approach another market. 

Anything that attracts you. 

Develop something in that market. 

Make sure there’s no overlap between your markets. 

Why?

When you wind up the day’s input for a market, you want to be exactly there, i.e. wound up with that market. 

Entering the other market is something fresh for you. 

You look forward to it. 

Why exactly?

Because of no overlap with something you’re done with for the day. 

Slowly, get a few strategies going, such that your working day is taken care of. 

This is how you proceed with a market.

Enter-do-exit. Done.

Next market.

Enter-do-exit. Done.

And next market. 

Once you’re done with a market for the day, only look at it the next day. 

This way you’ll stay fresh, and your time and energy won’t be exhausted by hourly nitty-gritties. 

Once done with all your markets for the day, do other stuff in life. 

Non-market stuff.

Like cultivation of hobbies, spending family-time, sport, meditation, chanting, reading, what have you. 

Do full justice to life. 

This is Why Your Blockbuster Gain Story is going to Happen

You’re learning to sit. 

You buy with margin of safety. 

You buy in small quanta,…

…and that’s why you’re always liquid,…

…to avail any opportunity that arises. 

Yeah, there’s nothing impeding your liquidity…

…because you’ve kept yourself virus-free, i.e. debt-free. 

You only buy quality…

…that’s going to be around for a long, long while,…

…because you don’t sell for a long, long while. 

You don’t listen to what the grapevine is saying…

…because of the conviction and strength of your own research and opinion.

Yes, you regularly go against the crowd. 

You either buy into debt-free-ness, or into managable debt that spurts growth. 

Your input into the market doesn’t affect your daily life, leaving you tension-free to address your non-market world and thrive in it,…

…and that is why,…

…for all the above reasons,…

…your blockbuster gain story is going to happen,…

…and what’s more,…

…you are also enjoying the ride leading up to it.