Successful Trend Following Has Nothing to Do with Predicting or Forecasting Successful trend followers do not trade their opinions. Actually once I realized my opinions do not mean anything nor will they make me any money, I stopped. I am always asked what do I think about this market or that market. I say I do not know! Honestly no one knows. We are dealing only with uncertainty. I joke around if you want to know what gold or the SP will do watch the so called experts on CNBC or Bloomberg. They seem to know the future! All that is needed for successful trend following is a complete trading plan that is simple and robust that is based on strong principles of money management along with the courage to follow the plan. Courage is where most people fail. They do not want to accept that they were wrong or a trade does not work. The reality is that there will always be losses and trades that do not work. If you can not accept these facts you will never succeed as a trader. You need to accept the risk of losing money when putting on a trade. You need to make this small enough that you are not bothered by the loss as well as big enough to profit if the trade works. I risk less than 1% of my account size on any trade. Depending on the program I am consistent. I do not raise it or lower it. This is what successful trading boils down to. -Tommy Tan
Posted on: Mon, 24 Jun 2013 08:42:32 +0000
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