If you have not been enjoying the global macro investing results that you dream of then you may want to read this. Will it fix all of your problems overnight? No, nothing does but it will help you to improve several areas of your trading that we see lacking in most traders and their trading process.
Losses: Many traders only focus on the potential gain that they can make. All to often they ignore potential risks and of course later on down the road they suffer the consequences. Being an optimist is fine but you still must be realistic. You must evaluate the opportunity on both the upside and the downside or at some point you will blow out your account in a few bad trades that go bad.
Process vs Outcome: Another thing that many traders fail to realize is that your trading process is far more important than any one outcome. If you bought the Brazil Bovespa stock index and it went down then how does it affect your trade in US Junk Bonds? It shouldn't affect it at all. Yet time and time again traders let it get to them mentally and then it messes with their results. That of course means they lose money. Realize that the markets don't care about you. So focus on your trading process and not on individual outcomes.
Look At Both Sides: Instead of only looking at the same stocks or currencies that you normally trade, you should look for the best risk adjusted opportunities are. Why get stuck in a position at the cost of a different trade that could have made twice as much. Don't hold onto losses just to avoid booking a loss. Instead use your money and avoid opportunity costs.
Outside Services: Traders hesitate to pay money to services because they are usually very skeptical. While that skepticism is well warranted it is also important to keep an open mind. If you are ever lacking for ideas or are just wondering if there is more money out there then you may want to take advantage of some of the many newsletters and other outside services. You will find that some don't fit your style but others will resonate well with you and by subscribing to 3-6 of these services you will likely plug some holes in your market knowledge.
Continuing Education For Global Macro Trading: If you want to be good and competitive in the global macro arena you have to be at the top of your game. You need to be reading and reading and learning about everything you can so that you don't miss the big dislocations in the global economy.
Well Being: A lot of traders underestimate the value of having good health. Study after study prove that the better your body is, the better your mind can function. Of course the better your mind functions the better you will be at trading and you will make more money.
We could go over each of these for hours and hours but the reality is that most people know at some level that they need to improve but human nature allows to to far too easily skip some steps while looking for shortcuts. Become efficient, not lazy and you will become a great global macro trader.
Losses: Many traders only focus on the potential gain that they can make. All to often they ignore potential risks and of course later on down the road they suffer the consequences. Being an optimist is fine but you still must be realistic. You must evaluate the opportunity on both the upside and the downside or at some point you will blow out your account in a few bad trades that go bad.
Process vs Outcome: Another thing that many traders fail to realize is that your trading process is far more important than any one outcome. If you bought the Brazil Bovespa stock index and it went down then how does it affect your trade in US Junk Bonds? It shouldn't affect it at all. Yet time and time again traders let it get to them mentally and then it messes with their results. That of course means they lose money. Realize that the markets don't care about you. So focus on your trading process and not on individual outcomes.
Look At Both Sides: Instead of only looking at the same stocks or currencies that you normally trade, you should look for the best risk adjusted opportunities are. Why get stuck in a position at the cost of a different trade that could have made twice as much. Don't hold onto losses just to avoid booking a loss. Instead use your money and avoid opportunity costs.
Outside Services: Traders hesitate to pay money to services because they are usually very skeptical. While that skepticism is well warranted it is also important to keep an open mind. If you are ever lacking for ideas or are just wondering if there is more money out there then you may want to take advantage of some of the many newsletters and other outside services. You will find that some don't fit your style but others will resonate well with you and by subscribing to 3-6 of these services you will likely plug some holes in your market knowledge.
Continuing Education For Global Macro Trading: If you want to be good and competitive in the global macro arena you have to be at the top of your game. You need to be reading and reading and learning about everything you can so that you don't miss the big dislocations in the global economy.
Well Being: A lot of traders underestimate the value of having good health. Study after study prove that the better your body is, the better your mind can function. Of course the better your mind functions the better you will be at trading and you will make more money.
We could go over each of these for hours and hours but the reality is that most people know at some level that they need to improve but human nature allows to to far too easily skip some steps while looking for shortcuts. Become efficient, not lazy and you will become a great global macro trader.
About the Author:
Jeff works at TheMacroTrader.com Which publishes a weekly newsletter on macro trading using ETF's. TheMacroTrader newsletter Is a great resource to investors looking to trade different asset classes across the globe.
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