Tag: norman hallett

The Trading Journal Do's and Don'ts

Posted on by The INO.com Team

Every time I ask Norman Hallett from TheDisciplinedTrader.com to "give us more" on a previous topic he's previously covered, he always delivers. What do I mean? Well, about a month ago Norman wrote a post discussing "Measuring your Trading Experience" and within the article he touched on an important part of many successful trader's daily routiens...a Trading Journal. So after many requests from readers Norman has come back to give us the BEST methods for writing and MAINTAINING a journal.

Please enjoy the article, to be notified when the upcoming The Disciplined Trader Intensive
Program will be held visit TheDisciplinedTrader.com to learn more, and please comment as much as you can below! We want to hear your journal story...or lack there of!

====================================================================

In The Disciplined Trader Intensive Program, where we train traders of all modalities to be disciplined in their trading, one of the topics we delve into deeply is journaling.  You see, journaling is the most effective way to self-evaluate your strengths and weaknesses as a trader, therefore allowing you to target specific problems for correction.

Here are two very popular basic questions about journaling that keep coming up in our Intensive along with answers that I hope will be helpful for your own journaling:

What is the purpose of having a trading journal?

Continue reading "The Trading Journal Do's and Don'ts" →

How To "Measure" Your Trading Experience? (wow!)

Posted on by The INO.com Team

He's a personal friend, great trader, exercise enthusiast, and today Norman Hallett from TheDisciplinedTrader.com is going to bring you into his world a bit and show you exactly how you can measure your trading experience. Norman's the best in this business with regard to discipline and I know he'd want me to mention Norman's latest video and check out his report titled: A Traders Opportunity of a Generation. Big claims yes...but the report delivers trust me. He will be expecting comments, so please don't let him down!

===================================================================

Trading is a human sport.

You against the markets.

On your end... You "gear up" before you get started by having your morning coffee, and if your smart, maybe doing a little cardio.  Then you sit down and start looking at the charts, where you assess the markets you'll be dealing with.

On the market's end... well, it's been, in most cases, trading all night, tempting you to figure out where it will be going next, based on its last hour's movement, last day's, and last month's movements.

As the referee used to yell when I was on the 'mat' in high school facing my opponent...

Continue reading "How To "Measure" Your Trading Experience? (wow!)" →

What is a Successful Trader? (you must have a CLEAR answer to this question)

Posted on by The INO.com Team

Adam and I have known Norman for a very long time. We've worked with him on many occasions and have spent time with him and his materials. We both agree that his trading wisdom and mental discipline go far beyond his years (No offense Norman), and I can confidently say that Norman Hallett is known as the Internet's leader in helping traders with their trading discipline.

I can say that because there are hundreds of INO members who are have taken part in Norman's training and coaching. Today he's launching a new class and has 4 Special Reports on trading discipline that I'd like to offer to you for no cost. Grab the reports HERE.

I also asked him to present us with a scenario as to what makes a successful trader. Below are two examples and Adam, Norman, and I would like for you to comment as to which person you think is a successful trader and why.

==================================================================

“Success means having the courage, the determination, and the will to become the person you believe you were meant to be”- George Sheenan

The Caribbean water is crystal clear and inviting as you sail on toward Tortola. Your cell phone rings and it’s your broker in New York. You listen intently and then say “sell and transfer the funds to my commodities account”. You disconnect and do a feeble fist pump and mutter, “cha ching”.

You are in the waiting area at JFK. Your flight to Hawaii leaves in an hour. As you don’t want to be disturbed, you re-check today’s positions and stops and close the laptop. You’re taking your family on a winter escape to paradise. No clients to worry about. No office politics. Just you and your laptop have made it all possible. You look at the Armani crowd and remember what it was like before you were able to work in your jogging suit. “No risk….no reward”, you say to yourself.

You are up in your “command center” as you and your spouse jokingly call it. You hear your children and husband getting the kids ready for school. He lives the buttoned down life and you are still in your robe. You’ve been up before the markets open and are in the midst of planning today’s trades. Yesterday wasn’t a fun experience; you didn’t make your daily goal and your win-loss was upside down. You try not to think about it prefer to focus on setting up for today’s trading. You come down from the command center to say goodbye to hubby and the kids; your mind is still focused on the three trades you plan to make as soon as the entry points presents themselves. Your husband starts to say something and you hold up your hand to stop him. “Don’t say a darn thing, you know the rules.” He smiles and herds the kids to the car. With coffee in hand, you bless the skills you have acquired but curse the loneliness of the isolation. But there is no other way you have the possibility to make the kind of money you can earn by trading and your husband makes enough to pay the bills.

But both you and your husband have a dream of moving out of the city and out of the rat race. You both want a better home and are able to send your kids to the best schools possible. As withholding and social security taxes are sucked right out of your husband’s paycheck, accumulating wealth is almost impossible. but becoming a successful trader may be the only way to reach those dreams and ambitions. Up until now, you have been able to actually make fairly steady profits in your trading accounts and you feel that after three years of full time day trading , you seem to have what it takes to make a go of it. But the pressure and isolation can become intense.

Which one of these scenarios is a more realistic picture of a “successful trader”?

Success is defined by the achievement of pre-established goals. The key to becoming a successful trader is identifying, quantifying, strategizing, implementing, tracking, analyzing, learning and growing as a conscious person. You see, there is no such thing as “easy money”. Let’s get this upfront right now, trading is not easy and not for just anybody.

How many people do you know who have an idea of what they want out of life? How many people do you know who understand what makes them happy and what fulfils their needs? Probably not many and this is where becoming a successful trader begins…..understanding yourself. You define what success means to you. If you don’t know what that is, how can you reach it?   Indeed, this process of defining what a successful trader means to YOU, lies at the heart of building a trading plan for success.

Norman Hallett
-----------------------------------------------------------------------------------

We're looking forward to your comments and before you comment be sure and grab Norman's 4 Special Reports HERE.

Testing your Trading System

Posted on by The INO.com Team

I just got permission from Norman Hallett, from Thedisciplinedtrader.com, to show you an excerpt from his newebook, "How To Design and Construct an Effective Trading Plan".  This ebook is not for sale to the public and is only offered to the students of his buzz-worthy "The Disciplined Trader Intensive Program" where he trains traders to be mentally and emotionally disciplined.

I've personally known Norman for years and his programs are the best in the industry, and his knowledge is used by top traders including many within INO.com. He's giving away 4 special reports which I highly recommend grabbing while they are still free, HERE.

This excerpt is about Testing Your Trading Plan... and it's worth the read... because without a tight trading plan... you're nowhere as a trader ...

===================================================================

Developing a successful trading system based upon your specific goals and a set of trading rules form the heart of your trading plan. These two documents wrap around the “fuzzy” part of your personal goals, aspirations, strengths and weaknesses and your preferred style of trading. But how do you know when you have a system that will meet your needs?

Today’s trading environment makes becoming a successful trader much easier that in the past. The electronic age has not only greatly reduced transaction costs but has also mad available a wealth of information available from any place on the globe. One of the most positively impacted industries was that of the world of finance. One of the most profound effects was that of the evolution of electronic trading. Not only did it offer 24 hour trading capabilities but it changed the trading paradigm. As a result of computer to computer bid-ask matching, many of the most knowledgeable people in the industry-the market makers and floor traders-suddenly found themselves no longer needed. Indeed, the new technology forced them out of the pits and into the field of education. In the logical pursuit of putting food on the table, many former “insiders” needed to leverage their knowledge. As a result, new online trading institutions have sprung up on the net Now, the independent trader community has access to formerly closely held information on not only the mechanics of trading like a pro but also the more subtle psychological considerations of being a trader.

Part time traders and aspiring full time traders can now have access to knowledge not formerly available to the public. From online courses to full time mentoring, the internet has opened up a whole new opportunity for a person to carve out a new and potentially very rewarding career without needing to take time out from an ongoing profession or to convert free time into productive time (many “house wives and stay at home dads are exploring the possibilities of trading). Indeed, businesses of all types are entertaining the idea of using a portion of company free cash for trading purposes. In view of the low levels of returns offered by most financial institutions, if a trader can develop a fairly low risk way of generating an ROI above 10%, many capable business owners are looking at trading as part of a new way of generating additional revenues to help optimize assets.  But is it possible to develop a trading system that is relatively low risk?
The answer is yes.

Given that you have put in the time to learn about investing and the types of investment vehicles that you feel are best for you to trade in, the trading plan is the first step in the process. As mentioned in Chapters 5 and 6, step by step procedures need to be developed and formalized into a document or checklist. Once you have established your procedures, the next step is to try the out.  Before the advent of paper trading via an actual trading platform, aspiring traders were more or less forced to sink or swim with their money on the table.  However, today, aspiring traders can build a professional trading plan and test it out before getting rolled by the pros.

When undergoing the testing of your trading system, you not only get to test your system but you also become experienced in using the trading platform and all its nuances. Moreover, you become comfortable with the trading process and how best to set up entry, exit and stops. In addition, most brokerages have seemingly come to the realization that many investors want to become educated and take a more active part in managing their investments. As a result, brokerages now make a much more serious effort to educate their clients by offering regular seminars and online webinars on trading education.

As mentioned before, the paper trading account is one of the most important tools a trader can have. Not only does it allow testing to help come up with a system that produces at least a 65% win-loss ratio over at least 100 trades, but it also provides a “safe harbor” when a system needs to be taken out of action for adjustment if production is not what it should be. Most traders will set up a trading rule whereby if the win-loss drops below its expected win-loss ratio over a certain time number of trades, the trader becomes obligated to stop trading and go back to paper trading to troubleshoot the system. Indeed, paper trading is the test bed.

Most statisticians will say that a significant sample size is about 100 test trades but this is just a rough estimate. A better way would be to test in different market conditions. For example, how does your system function during an up market with moderate volatility, in a down market with low volatility, etc, etc? However, this could take some time so as a general rule, it is probably a good idea to do at least 100 trades to develop the win-loss ratio but take into consideration that the macro economic environment of the market can have a distinct impact on how your system performs.

To read the rest of this post please CLICK HERE.

Are you trading at the right 'pace'?

Posted on by lindsay

Guest Post by Norman Hallett, CEO of Subconscious Training Corporation

---

A group of 1000 traders were recently asked, "What is the single most important mental/emotional concern you have that is preventing you from being the most successful trader you can be?"

The second most frequent response was the fear of blowing out their account. (For the record the first was fear of "pulling the trigger".)

Why all this fear?

The answer is multi-fold, but one of the main causes is likely that we are overtrading or trading too much before we are ready... what I call trading at the wrong "pace".

The more you put at risk, the higher level, or "pace" you are trading at.

When you first start out as a trader, you begin by paper-trading. You put no money at risk and you practice executing your trades the way your trading plan commands that you do. / No stress, no emotions/... there's no money or ego at stake. Your (phantom) "equity" seems to rise with ease.

You're chomping at the bit to up the pace. You're ready to trade with "real" money.

You begin to trade the minimum number of contracts to effectively run your trading plan. For the first time you are now dealing with your emotions and notice that they are causing you to stray from your trading plan.

You recognize that emotions play a big part in your ability to trade successfully and you take the steps necessary to get back to trading with ice-in-the-veins confidence.

When you experience the degree of success you are looking for, you feel you are now ready to step up the pace of your trading again... to the level that you always wanted to trade at. Full speed!

Your first trade in the big-time went well. Wow!... this is great! But then it happens... an unexpected move against you. And it's a big one. You never knew your emotions could be so debilitating!

Thoughts are racing through your head and you're tempted... I mean REALLY tempted... to pull your protective stops because you want the market to rebound and get you out of trouble.

And right before you click the mouse to lift your stop, you screech to a halt. "You MUST follow your trading plan", the voice in your head insists. You comply. You're stopped out and market continues to a free-fall.

You've lost money today... a bit more than you would have liked to, but you're proud of yourself and you actually feel pretty good.

Over the next few weeks and months you think back to that day... the day you could have blown out your account... and know that the profit you see now in your account would not be there if you were not ready, MENTALLY and EMOTIONALLY to trade at a full-out pace.

Now this little story is an ideal scenario. It happens to about 2% of real-world traders.

The fact is that most traders up the pace too quickly. They make 30% in their papertrading account in a month and kick themselves for not having the guts to use real money.

"Look at all the money I've left on the table," they cry.

So they move to level 2 (not the minimum number of contract to run their trading plan). The result:

Too much emotion, too soon. Losses result.

I could go on with examples of moving up your pace too quickly and not being emotionally prepared to handle it... but I won't.

I'll just let YOU think back to what got you where you are today and let THAT be your best example.

But don't beat yourself up... just scale back... now.

Then "train your emotions" to fit your trading pace and you too... YES, YOU TOO... can be in the trading elite.

It's not rocket science. It's including the development of your mind in development of your trading plan.

My best,

Norman Hallett, CEO
Subconscious Training Corporation

Makers of TradingMind Software

---

Normal Hallett will be speaking at the Orlando 2008 Investors' Super Conference. Read more about the event here.