Trading on the markets isn't just about using the right system, strategy, or knowledge; it's also about a factor that only the trader can control and that will determine how well he or she does.
Why do some people do well when they trade on the markets? How come some people don't succeed? Does luck have anything to do with whether or not you make money on the market? Is a person's success based on the system or strategy they use?
Many people would say that the system or strategy they use is what determines whether they win or lose in the market.
Every system you can use to make money on the internet will show you how to do it. You will definitely make money from it. Most of the time, people want to know how much money the system will make for them. All the systems out there will show you how their system has worked in the past based on historical data or activity. At the bottom of the page, there will be a disclaimer that says ".. Historical data does not determine or guarantee future earnings..."
So, why do these websites or pages have this disclaimer?
They added the disclaimer clause because they know that there are some things they can't control. We have feelings.
In any business, success or failure always comes down to how people feel. And it's the same when you trade on the markets. Read as many books as you want about trading and buy as many successful systems as you want. You can't do well in the markets if you can't keep your emotions in check.
That's why there's a disclaimer clause: the author can't control how his or her readers or customers feel, and that's the only thing they can't control.
There are only two main feelings that every trader will feel in the market: GREED and FEAR. When this feeling comes up, how we deal with it is more important than how we get rid of it. There are feelings that are normal and can't be stopped. This feeling makes us act, so how we act on it will decide what happens.
Like anger, when we're mad at someone, we can either say something mean or just kick a bucket or jump into a pool of water. No matter what we do, the outcome or result is always different.
Too often, when we started to lose money in trading for two or three times in a row, we started to doubt ourselves. When this happens, we're already afraid. We don't want to lose any more money, so we start to doubt that the system works.
Even though no system is perfect, which means that no system can guarantee that you will always make money. The person selling the system would say that we could consistently make money if we followed their system to the letter.
On the other hand, we start to feel great when we start to see two or three in a row. We start to think that we can make good money on the market, so we change our system, put more money on the market to increase our profits, or take on more positions, all of which lead us away from the system we were using in the first place. At this point, greed has already taken over our minds.
"The system is only as good as the person who uses it" is a saying. So, if we don't follow the system, we'll either lose money or make money. We would fail in the end. And you have to be disciplined to follow the system. How well we do in the market will depend on how well we can control our fear and greed.
Again, the key is to be disciplined. We need the self-control to be able to say, "I've reached my goal." When greed sets in, people say things like, "I should take profits now, even though it might go up." And when fear sets in, one should say, "I have to take a position even though the market doesn't seem to be moving in my favour."
Even though these are the only two times when greed and fear come up, there are and will be many other times when we have to decide whether to enter or leave the market. And these are the two most important choices to make in the markets if you want to do well. The discipline to stick to the system no matter what the market does.
So, no matter how good the system is, the only way to have long-term success in the market is to have the discipline to get over our own feelings and stick to a certain system.
