Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Look up keyword
Like this
17Activity
0 of .
Results for:
No results containing your search query
P. 1
DrTharpJournal

DrTharpJournal

Ratings: (0)|Views: 349|Likes:
Published by Santa Ezergaile
advice on forex trading
advice on forex trading

More info:

Categories:Types, Brochures
Published by: Santa Ezergaile on Mar 29, 2009
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

11/03/2013

pdf

text

original

 
Five Steps to
Consistent Profts
DR. Van
K. THARP
 SYSTEM DEVELOpMENT 
54
DECEMBER 2008 / VOL. 4 ISSUE 12
 
Dr. Van Tharp outlinesfve important stepsnecessary to becominga consistently proftabletrader.
T
he goal o my Super rader program is to helppeople develop a ull-time trading business thatproduces consistent, above average prots undera variety o market conditions. Tis means that youcan perorm protably in up markets (both quiet andvolatile), in down markets (both quiet and volatile),and sideways markets (both quiet and volatile). ohelp traders reach this goal, I have designed a ve-stepapproach. I you are reading this, you are probably interested in this sort o perormance, even thoughyou may not be part o the Super rader program.My objective in this article is to amiliarize you withthe ve steps.1. Work on yoursel and your personal issues so they do not get in the way o your trading. Tis stepmust be accomplished rst. Otherwise, it will in-terere with each o the other steps.2. Develop a business plan as a working documentto guide your trading. Tis business plan is not toraise money, which is the purpose o many busi-ness plans. Instead, it is designed to be a work-in-progress to guide you through your trading career.Te business plan actually helps you with all veo the steps. Te plan also includes an overview o the big picture inuencing the markets you will betrading and a method or keeping on top o thoseactors so you will know when you are wrong. My view o the big picture is updated in the rst issueeach month o Tarp’s Toughts.
55
DECEMBER 2008 / VOL. 4 ISSUE 12
 
cle, in my next lietime, I would like to be born beau-tiul and talented.Let’s see, she is very artistic. M wie has become a proessional painter, but my nieceactually completed the initial art course aster thanmy wie did – she was so good. She also sings like anangel and coming rom a liberal arts background sheearned a degree in biomedical engineering, graduat-ing cum laude. I think she passes the talent criteria with ying colors. As ar as beauty, I would describe her as one o themost stunningly beautiul women I have ever seen.Everyone that meets her comments on how beautiulshe is. Here was an incredibly beautiul and talented woman, who because o her belies, did not think she had those qualities at all. Your reality is shapedby your belies. By the way, I have been working onthose belies o hers since she has been living here,and she is nally coming around. Who you are is shaped by your belies about yoursel.In addition, you do not trade the markets. Instead,you trade your belies about the market. One o thekey aspects o working on yoursel is to examine mosto your belies to determine i they are useul. I they are not useul, then nd belies that are more useul.Tis is one o the key aspects to working on yoursel. You probably will never be ree o limiting beliesand some aspects o sel-sabotage during your lie-time, but I consider this step to be complete whenyou transorm about ve very limiting aspects o yourlie and you eel very diferent about each. Once youhave accomplished ve such transormations, then Iconsider you capable o generally overcoming utureroadblocks that might come up in your trading.
Part II – Developing a Working Business Plan
Te business plan part o trading includes step one.In act, a good business plan includes a thoroughexamination o the person who is doing the trading– belies, issues, strengths, weaknesses, goals – every-thing you can possibly think o about yoursel shouldbe included in this document.However, the plan should also include many otherimportant things:Your assessment o the big picture and how you will keep up with it. For example, I wrote aboutthe possibility o a huge secular bear market in2001 when I rst started working on Sae Strate-gies or Financial Freedom. I decided that the bigpicture should include3. Develop several strategies that t your view o the big picture and understand how each o thesestrategies will perorm under various market types.Te ultimate goal o this step is to develop some-thing that will work well under every possiblemarket condition. Actually, it is not that hard todevelop a good strategy or any particular marketcondition (including quiet, sideways). It is very dicult to develop one strategy that works wellunder all market conditions – which is what mostpeople try to do.4. Toroughly understand your objectives and de-velop a position sizing strategy to meet those ob- jectives. Probably less than 10% o all traders andinvestors understand how important position siz-ing is to trading perormance and even ewer un-derstand that it is through position sizing that youmeet your objectives. Tus, the ourth step is todevelop position-sizing strategies or each systemthat will help meet your objectives.5. Monitor yoursel constantly and work to mini-mize the number o mistakes that you make. Idene a mistake as not ollowing your rules. Tus,or many people who have no written rules, every thing they do is a mistake. However, i you haveollowed the rst our steps, you will have rules toguide your trading and you can dene a mistakeas not ollowing those rules. O course, when yourepeat the same mistake over and over again, thatis sel-sabotage. However, by monitoring yourmistakes and continuing to work on yoursel, youcan minimize the impact o such mistakes. In my opinion, someone who does this will tend to pro-duce consistent, above average prots.
Part I – Working On Yourself 
Tis part o the program is so important because eve-rything you do is shaped by your belies – in act, yourreality is basically shaped by your belies. What is abelie? Every sentence I have written (including thisone) reects my belies. Every sentence that comesout o your mouth reects your belies and your be-lies shape your reality. Who you think you are isshaped by your belies.Let me provide an illustration o how that works.My niece rom Malaysia came to live with us whenshe was 19 years old (my wie and I were putting herthrough college in the United States). One day shesaid to me ater living with us or about a year, “Un-
56
DECEMBER 2008 / VOL. 4 ISSUE 12
 SYSTEM DEVELOpMENT 

Activity (17)

You've already reviewed this. Edit your review.
1 thousand reads
1 hundred reads
Bob Bazza liked this
mindmast liked this
rjcantwell liked this
weibull liked this
apandev liked this
mindmast liked this
amexhui1852 liked this
ppaladine liked this

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->