{"id":1321,"date":"2009-05-17T08:24:53","date_gmt":"2009-05-17T12:24:53","guid":{"rendered":"http:\/\/club.ino.com:80\/trading\/?p=1321"},"modified":"2009-05-15T12:49:52","modified_gmt":"2009-05-15T16:49:52","slug":"good-trades-bad-trades-and-the-trap-of-being-right","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2009\/05\/good-trades-bad-trades-and-the-trap-of-being-right\/","title":{"rendered":"Good Trades, Bad Trades and the Trap of Being \"Right\""},"content":{"rendered":"<p>I think we've all been there...we've made a trade, we're happy with that trade, and yet our reasoning behind the trade was wrong! Today I'd like everyone to welcome Bob Iaccino from <a href=\"http:\/\/broadcast.ino.com\/redirect\/?linkid=983\" target=\"_blank\">TraderOutlook.com<\/a>. Some of you might reconognize the name, and that's because Bob is a frequent contributor on CNBC, CNBC Asia, Bloomberg Television, Bloomberg Radio, CNN, CNN International, Fox News, and several other media outlets as a special guest analyst. Yeah he's all over the place and he knows what he's talking about.<\/p>\n<p>Enjoy the special Sunday guest blog, please post comments to Bob or about the article, and spend a few minutes on <a href=\"http:\/\/broadcast.ino.com\/redirect\/?linkid=983\" target=\"_blank\">TraderOutlook.com and watch his forex videos!<br \/>\n<\/a><\/p>\n<p>====================================================================<\/p>\n<p>I remember one of the smartest human beings I\u2019ve ever mentored, in my 15 years in the markets, explaining a trade he wanted to place. Let\u2019s call him \u201cNeal.\u201d\u00a0 Neal told me that the Fed needed to raise rates immediately and he was piling up long USD.\u00a0 Well, the rate rise never came, but he made $1oK on his position anyway. The market was pricing in a larger rate rise in the future.\u00a0 He then prances around my trading room like a show horse, talking about how he was right for taking such a large long position. I walked over to him and proceeded to tell him that we were taking the money out of his account. \u201cWhat?! Why?!\u201d exclaimed Neal. \u201cBecause you were wrong. You said the Fed was going to raise rates immediately and they didn\u2019t,\u201d I told him, \u201cso you have to give the money back.\u201d<\/p>\n<p><!--more--><\/p>\n<p>Obviously, we didn\u2019t take the money from Neal but the point, I believe, is a strong one. In trading, focusing on being \u201cright\u201d will get you a cup of coffee and a few hours in front of the help wanted section of Craigslist. Right is ego and that has no business in a trader\u2019s working day. If you want to be \u201cBig shot trader,\u201d do it at the bar at The Four Seasons Hotel on the weekend.<\/p>\n<p>In successful trading, there is no \u201cright,\u201d only good trades and bad trades. As you grow as a trader, you want to eliminate as many bad trades as human nature will allow. It is possible to lose money on good trades and make money on bad trades but as time goes on, the more you eliminate the bad trades and put on the good ones, the more money you will make. What makes a \u201cgood trade\u201d?\u00a0 It\u2019s a combination of discipline, risk\/reward, money management and internal honesty. Looking inward to see if you are in a trade because you want to prove (to others or to yourself) just how smart you are or because you did your analysis, calculated risk\/reward and decided that this was the best trade the market offered you.\u00a0 Have you ever walked up to your screen with a position in mind only to find the charts or the fundamental news told you something different? Which trade did you put on? Were you able to face that your opinion was wrong and put on the good trade that the market was offering you?<\/p>\n<p>Most successful traders that I know in the modern age have varying levels of personal ego, but very little trading ego.\u00a0 They are fine with a loss and know that the market will not save them from themselves. The days of the big swinging pit trader, pushing the market around, are over. There may be funds and institutions that can temporarily affect market direction, but the Forex market is too large and will always go exactly where it is supposed to be. Do your research and be disciplined in your trading plan and leave Neal, the prancing show pony exactly where he belongs\u2026in the barn.<\/p>\n<p>Bob Iaccino<br \/>\n<a href=\"http:\/\/broadcast.ino.com\/redirect\/?linkid=983\" target=\"_blank\">TraderOutlook.com<\/a><\/p>\n<!-- AddThis Advanced Settings generic via filter on the_content --><!-- AddThis Share Buttons generic via filter on the_content -->","protected":false},"excerpt":{"rendered":"<p>I think we've all been there...we've made a trade, we're happy with that trade, and yet our reasoning behind the trade was wrong! Today I'd like everyone to welcome Bob Iaccino from TraderOutlook.com. Some of you might reconognize the name, and that's because Bob is a frequent contributor on CNBC, CNBC Asia, Bloomberg Television, Bloomberg [&hellip;]<!-- AddThis Advanced Settings generic via filter on get_the_excerpt --><!-- AddThis Share Buttons generic via filter on get_the_excerpt --><\/p>\n","protected":false},"author":41,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[1994,1993,1995,1992],"class_list":["post-1321","post","type-post","status-publish","format-standard","hentry","category-general","tag-being-right-in-trading","tag-bob-iaccino","tag-getting-past-your-trading-ego","tag-traderoutlookcom"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v23.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Good Trades, Bad Trades and the Trap of Being &quot;Right&quot; - INO.com Trader&#039;s Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/wwwtest.ino.com\/blog\/2009\/05\/good-trades-bad-trades-and-the-trap-of-being-right\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Good Trades, Bad Trades and the Trap of Being &quot;Right&quot; - INO.com Trader&#039;s Blog\" \/>\n<meta property=\"og:description\" content=\"I think we&#039;ve all been there...we&#039;ve made a trade, we&#039;re happy with that trade, and yet our reasoning behind the trade was wrong! 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