How to Hold Yourself Accountable in Your Trading (Part 3)

05/13/2009 12:01 am EST


Timothy Morge


Now let me show you one of the reasons I love to teach others to become better traders! Below is a shot from one of my newer one-on-one mentoring student's month-end statistics.

There's a real joy to teaching a struggling trader and seeing them have results like this at the end of a month. The joy I feel is not going to buy me a new car or a bigger house, but the joy I feel feeds my soul, makes me feel a little lighter. It makes me think that somewhere, someone feels I have influenced them, and helped them on their way.


Let me share with you some of what I told this trader after we went over his statistics in detail:

  • Don't expect the trading results from every month to look like this. This is a wonderful month, but the statistical results are probably too wonderful to repeat month after month.
  • Even though you had a wonderful month and obviously greatly increased the value of your account, I suggest you keep your position size the same for the upcoming month (May, in this case). I tend to judge multiple months when deciding when to increase position sizing.
  • We looked at his largest winner ($750 per contract) and largest loser ($225 per contract). The outliers told the same basic story as the average statistics. Taking the largest winner or loser out of the statistics didn't change things.

This particular trader just finished his ninth week in my one-on-one mentoring program, and before entering the program, he had taken quite a few expensive courses from other trading teachers or coaches, but could not find a method that he could use to trade profitably. I think there were three keys for turning his trading around and that they were finding a time frame that fit his lifestyle, an instrument that fit his personality, and the all-important third key was to learn to control his losses and only take trades that had smaller initial stop losses. Once he got over that hurdle and began to use market structure to define his stop losses, you can see what happened to his trading results!

Many of you may be wondering how unusual it is for me to see a set of monthly statistics like this from my students. Most of the traders I mentor are profitable each month, and each month, one or two of them tend to have outstanding statistics. In fact, another of my students had month-end statistics this past February that were almost identical with the trader mentioned above. And another just joined the proprietary trading room run by my partner, Dro, in downtown Chicago—he's made the leap to full-time professional trader!

These are good things happening to good people who work hard every day and know that that they have to continue to work hard, even after having wonderful trading months.

I hope this small glimpse into one of my student's month-end meetings and statistics inspires some of you. Making money consistently is possible if you work hard, master your tools, and most importantly, master yourself. I'd like to think having a good guide helps, but in all honesty, the hard work these traders do each and every day determines whether they are going to be successful.

I wish you all good trading. Read Part 1 | Read Part 2

Timothy Morge

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