Trading Commodities: A Professional Knows Where Not To Automate The Process
More often than not it is the successful people who come to take up trading commodities. Because trading commodities requires capital and capital is the offshoot of success. Such successful people often meet with disastrous results when they try to apply their rationalistic and meticulous methods in trading commodities that gave them success otherwise. A growing trend in the economic market is that, it takes money from many and redistributes it to a few.
There is always a vast difference between the amateurish approach and professional viewpoint over trading commodities. Amateur people consider analysis and studies as the tools for the success, since such analysis enables them to ascertain the market trend. In practice however, it is not necessary at all. A professional on the other hand is experienced enough to know the limitations of rational approach and analysis. If you are a professional, you would want to put your money on a consistent rather than analytical approach. As professional you know that future is always unpredictable.
Contrary to the belief of the amateurs, the professionals rarely have a cue regarding the opportunities actually lie. They do not believe in favorite time. Whether the professional is a floor trader holding the trade for a couple of minutes, a day trader, intermediate term trader, or long term trader, he knows that it is consistency and not flamboyancy, which is the best policy. They stick to the time frame for each task to be accomplished.
Ordinarily as a professional you would have your own way of identifying potential trades. Professionals do not believe in sudden changes and they normally stick to their line of function. They always try to keep their position in tact or secure a higher position. On the other hand the action plan of an amateur would be based on a time frame and a particular issue. They would like to have least losses in their trading spree. Professionals are seasoned enough to sustain losses. It is their common routine to prepare the plan to mitigate any loss on the way, if any. Professionals also do not usually suffer from any ego problems that constantly haunts the amateurs. Whether you are a professional or a generalist, a continuum will remain between 0% mechanical trading and 100% mechanical trading. A 100% mechanical trader would never require making any decisions, since all the decisions have been taken at the professional level. On the other hand, the person or persons with 0 trades, and following it mechanically will be taking decisions on the spur of the moment without seeing its pros and cons. An average person may become a very successful one in trading commodity provided that they look to the specified structure for the task to be accomplished. However, a near perfect trading system does not exist. The more you think of the past data, the less you will be successful in gathering your profitability in future. Successful business people use the same parameter that would be effective, despite counter-intuitive environments.
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