“Almost every successful investor I know has shown that they have learned a lesson well, and that lesson is that market success comes from an internal control process," writes Dr. Van Tarp in an article entitled The Holy Grail of Investment.
This is a fundamental change for many investors. It is not difficult for some investors and traders to gain internal control, but it is very difficult for the majority of them to understand its importance. How to increase internal control? Everything on the stock market is psychological and that’s it!
Many investors believe that the market is like a living being that sacrifices others. If you believe this sentence, it means that it will happen to you as well. But the reality is that markets are not sacrificing, it is investors who are sacrificing themselves. Every trader has his own destiny. No investment can succeed without understanding it.
Consider these important facts
Most successful professionals in the market have succeeded in controlling risk. Risk control is contrary to our natural inclinations and behaviors. Risk control requires a great deal of internal control. An example of this could be that some people can buy a stock only by considering the potential benefits that the purchase of a share may bring them for any reason, regardless of the risks involved, including the underlying situation. .
Most successful oscillators have a success rate of about 35 to 50 percent.
They are not successful because they predict prices well!
They are successful because the volume and number of their successful trades is much higher than their failed trades.
This also requires a lot of internal control.
Most successful conservative investors move in the opposite direction of the market.
They do what others are afraid to do.
They are patient and always like to wait long enough for the best opportunities.
This also requires significant internal control.
Success in investing and trading requires more internal control than any other factor.
In fact, this is the first step towards success in stock trading.
People who dedicate themselves to the proper growth and development of this control,
They are the ones who ultimately achieve the most success.
How to increase internal control?
Let’s look at internal control from another angle. Over the years, I’ve talked to many people about success in trading and I’ve come to the conclusion that all of these factors can be summed up in three factors: psychology, money management (the percentage of money allocated to an investment case). ), And create and improve the system permanently.
Most people overemphasize the creation of the system and consider the other two to be insignificant. More successful people, and those with a more complex mind, believe that all three factors are important, adding that psychology is more important than any other factor, and that money management and the creation of an appropriate system are second and third.
A professor of investment once told me that he taught a course in trading in the 1970s that lasted about 10 weeks. He spent the first week teaching basic information about trading in the market. He then spent another week teaching technical subjects, including Dunchin’s moving average. But he says the remaining eight weeks should be spent on accepting people to follow their systems closely, as well as helping them understand that it is perfectly normal to lose money in this market, and that using any system could lead to losses. To have, to do.
Everything on the stock market is psychological and that’s it!
I look at it differently, and I still insist on my beliefs: I believe that success in business is 100 percent in psychology. But I must add that, in my opinion, money management and the creation and adherence to a system of their own are components of psychology. The reason is simple: we are human, not robots.
To perform any behavior, we must first process the information through our brain, and it is clear that in order to replicate any behavior, one must understand the components and how of that behavior well.
This highlights the importance of modeling in the field of investment.
Published and authored by FalconProfit.com
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