Why Trading is your Business

Do you believe that trading is your hobby? …
Do you treat trading the same way as you would place a bet on the horses or football? …
Or do you treat trading the same way as you would  a night at the casino (hopefully without the alcohol), ie you take a specific amount of money with you that you are prepared to lose that night as long as you enjoy yourself?

Gambling

If you answered yes to any of those questions, it shouldn’t surprise you if I told you “You’re Gambling”…
You may say you know that, and you understand all the implications of gambling at any level and have taken precautions to protect yourself against addiction. So that you’re happy just to have a bit of fun. Then I am am happy for you. This however is probably not the blog for you, see you on the next one.

But if you are not happy, but you are treating trading as a hobby and you are placing trades in the same fashion you would on the horses or the football. Or maybe you don’t realise that you are treating trading as a hobby and placing trades as other people place bets on the horses or football …

Which is what you are doing if you are placing trades without a written trading plan or placing trades that do not follow your rules …

Either way you are in the right place with the right blog. I’m just starting with the bigger picture.

 

Memorise this statement as it’s rather good

“A Trading Mistake is not following your rules, if you have no rules anything you do in the market is a mistake.”  a very good mentor told me that one.

 

Understanding the bigger game

Just like anything else in life, Trading is a game, with rules. What we must understand is that the rules we have in life are not the rules you get in a board game or a card game. Those rules are final and steadfast…

Not so in Life, not so in Trading. These rules depend on which level you are playing the game. In any of life’s games there is a hierarchy and trust me we are not at the top. Not even close, but that’s another story. In Trading those at the top are called the CFTC, these are the guys and girls who make the big rules for the big boys. The big boys being the major brokers who in turn present us with another set of rules within the CFTC rules. They can also insert, delete or distort any of their rules for their benefit at any time… which they do at every opportunity.                                                                                          

They are like the boy in the playground who says, “My Ball, My Rules!”            

 

 

 

This will always be the case, it’s part of the game and is no different to any life game. Be it the money game, or the legal game. Don’t waste your time or energy complaining about the game, it’s rules or the rule makers. You will stress yourself out going around in circles banging you head against a brick wall. While losing the game and spending the rest of your life in some sort of Asylum. Pointless and not at all profitable.

 

Your Rules

No. What you must do instead is to learn to play the game by your rules, within their rules. All the time keeping to the right side of the law and your values. Or at least play by the rules I offer you until you understand how to create your own.

When designing the rules for your game you must take into account there are some rules you will have to incorporate. These are the rules that when broken will get you incarcerated or thrown in jail if you’re from the UK. These are called Laws and are inadvisable to ignore. Unless you are starting this trading game from a much higher level and you have your own Lawyers and accountants. In which case you will have already been advised of which Laws apply to you and you will also know the ones you can possibly get around. You will know better than me.

Again, do not start complaining that this is unfair …remember the Asylum. Never worry about what anyone else is doing within your game. Just make sure you are using the rules that you have with the maximum efficiency. Play the game to your rules and values. You only have control over you and your rules. Never forget that.

 

 How do I write rules to a game I had no idea I was playing?

Great question glad you asked. The business plan, this is your set of rules for the wealth game. This is your Big Goal, your main Objective. This is your destination in life, if you don’t have one of these you may want to keep an eye out for my next blog “My Big SMART Goal and how it’s made me Successful in Life and Trading” And then follow the instructions to get one. For those of you that have your Big Goal written down and imprinted on your mind. Well done. Now let’s move on.

Now that you have your destination, you can begin to create your map. This is how you achieve your goals and objectives. This will be your step by step instruction manual to success. It is your fool proof step by step guide to conquering the… erm …whatever you wish to conquer.

This is done by reverse engineering your big goal into stages. This needs to be done for each area of your life, Health, Play, Relationship, Work, Passive Income and Wealth. These then become your maps to Success in each area. These are the maps that tell you how to get from where you are now to where you wish to get to.

 

Business Plan

Your wealth map, better known as your business plan is a very detailed map of getting from where you are now in your financial journey to where you want to be in the time frame you have allowed.

“But I haven’t got a business!”

“That’s why you’re not Successful!”

Trading IS your Business. You grow your Trading as you would any business to achieve your goals and objectives. So, in order to plan your systems and strategies for trading you need to know your objective. This will better explain why some of you are struggling to write your Trading Plans, this because you have missed a step. You need to write your business plan first in order to know what you need to achieve from your trading. You must therefore have a Business Plan in order to be a successful trader. Without a plan to succeed, you are planning to fail.

No Business survives for long without a business plan. Do you think that Steve Jobs and Apple conquered a Global Market in a relatively short space of time by winging it, or do you think they may have had a Business Plan?

 

It’s like chartering a boat and saying to the Captain “I’d like to go now please”
“Where?”
“Just go”
Now that would be fun if you have nowhere to be. But it’s no good if you have to be in New York in two days’ time.

You’re far more likely to sink at sea though…

Sign up to our weekly newsletter so that together we can prevent that from happening…

 

If you are struggling to learn to trade consistently by yourself, then I would suggest taking a look at our Trading Room. Here you will gain access to two coaches, Andres – Director of Trading and myself Director of Trading Psychology. Where else can you learn and be coached by a Trading coach and a Trading Psychology Coach, while making pips?

 

To Your Consistently Profitable Trading

Callum

 

P.S. What did you think of this Lesson? Please share it with us in the comments below!


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Callum McLean

Co-Founder and Trading Psychologist at Special FX Academy
Trading Psychology Coach and Certified NLP Coach. It is my belief that trading is 99% Psychological. And it is by understanding and improving your psychology, that you can be a successful trader. Success is a formula that everyone can and should learn.
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