My name in Andrew Abraham. I have been investing in commodities and managed futures since 1994. I adhere to the philosophy of trend following.
Trend following stresses a disciplined approach to commodity/ futures trading. Successful trend following and commodity futures investing requires patience, discipline and actively managing the risk. What sets me apart from other traders is that I am not only concerned about the return on investment but how much risk I will have to tolerate to achieve my goals.
Taking the Emotions Out of Trading & Trend Following
My first thought is that you the reader, will not believe that this is really possible. However….It truly is possible to take out the emotions of trading & trend following.
Through Risk management and a thought process in thinking of the next thousand trades one can overcome negative emotions. “Decide where you will get out before you get in” and “Never risk more than some small percentage of your assets (1%) on any single trade idea.
Yesterday I had several one on one mentoring sessions with traders ranging from relatively experienced to professionals with years in the markets. We spoke at great length the concept of accepting losses and knowing where to exit a trade even before entering. Even this is so basic they had issues addressing these issues.
Personally I risk even less than 1% in several of my trading programs. I used to ask myself how much will this trade cost me in order to see if it will work. I had no expectation it would work.
Thinking in exact terms of where you enter a trade and where you exit a trade prior to entry solves alot of emotional baggage. This approach gets around my natural tendency towards impatience,a highly undesirable trait for a trade… as I am making pre-planned trading decisions rather than actively watching the market and being tempted to make impulsive trades. Most importantly knowing where a trade does not work takes most of the emotionalism out of the trade. This is a good thing as I believe emotions are a detrimental influence.
Successful trading is not learning a group of indicators or systems. Trading success is risk management and trading psychology.
If I can assist you to improve your trading email me
Andrew@TrendFollowingmentor.com
