Lessons by Joe Ross | Forex Factory

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Lessons by Joe Ross

  • #1
  • First Post: Edited Feb 28, 2006 11:33am Mar 31, 2005 2:15pm | Edited Feb 28, 2006 11:33am
The following question arrived in the mail this week:

"When you were teaching us at our forex office in Florida, you stressed discipline. Our head trader stresses discipline. What I want to know is if discipline can be acquired or is it just something you are born with? I’m having trouble finding it in myself."

Personally, I believe discipline can be learned, although at times it is very painful. When I began trading, I was an undisciplined person. But trading and the markets forced me to become disciplined. Was the discipline already there and just needed to be extracted? Or did I actually learn it? I can’t really be sure. I was a delinquent as a boy. I was in rebellion against all authority. I hated teachers and I hated school. I was really struggling with life as a young man.

One of the largest private trading firms, 1,500 S&P day traders, kept their offices near yeshivas. A yeshiva is a rabbinical school, which produces rabbis of the Jewish religion. The students coming out of the yeshiva were highly disciplined and made excellent traders. Was the discipline innate in those yeshiva students? Or did they learn it under the strict supervision of the rabbis who controlled their lives? I think they learned it.

I’ve mentioned previously that it can help to keep a journal if you want to learn discipline. The journal I kept was very basic and included what trades I made during the day and my reasons for getting into the trade. It is what I did with the journal that helped me to be disciplined. Anyone can make entries into a journal. I let the contents of my journal keep me in line. It became my supervisor. I took to heart what I wrote there. I no longer keep that kind of journal because it has served its purpose in making discipline into a habit in the way I trade.

FF;_______________

About the Author:

Joe Ross, trader, author, trading educator is one of the most eclectic traders in the business. His 48+ years include position trading of shares, and futures. He daytrades stock indices, currencies, and forex.

He trades futures spreads and options on futures, and has written books about it all - 12 to be exact. Joe is the discoverer of The Law of Charts, and is famous for the Ross hook and the Traders Trick Entry. His website is http://www.tradingeducators.com
'Trade what you see, not what you think!' -JR
  • #2
  • Mar 31, 2005 7:23pm Mar 31, 2005 7:23pm
Great story. It's always good to keep a journal if only to look back and see where you have been. I really don't have good disciplne when it comes to trading(Vegas just loves me). I have found however that a mechnical system relieves most of that. In fact, I've even welcomed losses. Sort of like a salesman welcomes losses knowing that it's inevitable to getting a win.
  • #3
  • Apr 7, 2005 1:01pm Apr 7, 2005 1:01pm
I believe that disciplince can be learned, as I am sure that I have none of it before.

Actually I believe that 80% of traders learn discipline through their losses, those who don't learn from their losses are simply gamblers and not traders.

"You pay nothing, you get nothing" or "You pay nothing, you learn nothing" both can be correct, but you will have to pay something at the end of the day.


Thanks,

Nader M. Arafa
  • #4
  • Jun 22, 2005 4:37pm Jun 22, 2005 4:37pm
I found the following excerpt from today's Innerworth Newsletter to be interesting. I take it for granted that the majority of traders lack discipline. It never occurred to me that an anal-retentive, overly disciplined person might have trouble trading. I found this enlightening because even though I may be an a**hole, I'm definitely not anal.

Quoting Innerworth Newletter
Discipline and self-control are well-studied personality traits. Some people are highly disciplined and very self-controlled. They scrupulously follow rules, and are careful to control their impulses. You know the type; they pay off their credit cards every month, are never late for an appointment, and carefully plan every detail of their lives. Although these characteristics may be ideal for trading, there's a downside: overly disciplined people may have trouble taking risks. They prefer a sure thing, and trading outcomes are rarely sure things. Traders tend to prefer living a little on the wild side. They may not recklessly seek out risk, but they don't mind it. Relatively speaking, they tend to lack discipline and control.
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  • #5
  • May 19, 2006 11:37am May 19, 2006 11:37am
Hey Joe! I’m struggling. My home life is not conducive to trading, and I’m not sure whether to continue. I’m not even sure of which things are important.

Almost anyone who wants to succeed needs to ask themselves certain questions before beginning to trade. Essentially, it is a matter of counting the cost BEFORE, not after you decide you want to pursue trading as a serious part of your life.

What time period trader are you? How long do you feel com¬fortable holding a trade and how much financial risk can you com¬fortably assume on a one contract basis? How much money would you need to lose before you quit trading? How much would you need to win to quit? You should know the answers to these important ques¬tions before trading, and review them frequently. Your money management skills are the most important tools you have to trade the markets. With good risk averse money management skills, and even a mediocre trading approach, you will be successful. With a great trading approach and poor money management skills, you will lose money. Remember, a winner will find a way to win with a losing trading system and a loser finds a way to lose with a winning trading system. No man with a failed home life truly achieves any success.
'Trade what you see, not what you think!' -JR
  • #6
  • May 20, 2006 1:34pm May 20, 2006 1:34pm
I know that 95% of forex traders ed by losing their money
  • #7
  • May 21, 2006 1:52am May 21, 2006 1:52am
If your home life is a wreck it will reflect on your trading. When I first started trading my sweet wife was sceptical and fought me hair, tooth and toelail. I had to demo for a long time for her to get used to the wierd hours and the fact that when I was in my office (It is kind of open to the rest of the house) I was not at home, and therefore not available to do chores and favors. With a lot of patience and love we worked it out and now we are all happy with the Forex thing. (she kinda likes the money too!)

I had to save for many months out of my meger disibilaty income to save up enough money to open an account. It had to be money that would not be missed. I would never risk the rent money on Forex. It is just plain stupid. It is scared money and you will trade it differently than you would disposable money. And after trading is 95% Headology.

How much would I need to win to quit? Who wants to ever quit? It's not the money, it's the trade. If you are in it for the money, you are dead already. just pack it in now and quit. There is never enough money trust me on that one. I used to drive around Hollywood in a big ole' Cadalc and hang out with high class movie folks. My little company raised $8Million and we were having fun making music vids and movies and doing the whole Hollywood thing. That all went away almost overnite. Lost the house, wife, 5 kids and the Caddy. Now I am disabled and live in a small home in Northren California. I don't have a lot of cash but my head is on straight I have a great new wife (13 years now) and I am happier than ever. The point is, I love the trade, not the money. Some may think that they are the same thing, but they are not. If you love the trade, you will get the money, but if you love the money, you will loose the trade.

Best of luck Joe. Give us more details in smaller bites and we can pool our resources and try to get you on the right path.
Nolite dormiens pungere ursum. -- Latan Proverb.
  • #8
  • May 24, 2006 10:57pm May 24, 2006 10:57pm
I fail to see how forex is all exciting...... other than the money. I don't wanna waste my day looking at charts, and other data. But I still do it....only for the money.
  • #9
  • May 24, 2006 11:49pm May 24, 2006 11:49pm
Quoting blueshift
I fail to see how forex is all exciting...... other than the money. I don't wanna waste my day looking at charts, and other data. But I still do it....only for the money.
I've got to agree.. whether its stocks, futures, or forex, at the end of the day its all about the money for me.
  • #10
  • May 25, 2006 12:02am May 25, 2006 12:02am
My vote goes to the Whip.

But then again, I also like fly fishing. If it was only about catching fish, I'd use a Trawler.
  • #11
  • May 25, 2006 12:07am May 25, 2006 12:07am
Quoting blueshift
I fail to see how forex is all exciting...... other than the money. I don't wanna waste my day looking at charts, and other data. But I still do it....only for the money.
I have to disagree. When there are so many people out there that are unable to do this due to whatever. There are many reasons they cannot. But, to be able to succed at this. Don't get me wrong, the money is gonna be great. I have told people about trading forex and they shake their head at me and tell me it is a waste of money. To be able to succeed and show that person, what a great feeling. I also know how hard this is. It is no cake walk. For me personally to be able to do this, how awesome. If you don't want to waste your day looking at charts, use a method/system that allows you to trade on 4hr charts or day charts. If it is only about the money, and you don't get excited about what you are doing, that is not an attitude that will work in the long run. It is kind of like, driving to work everyday. If you take the same road day in and day out and it is a boring drive, you are gonna get sick of it and find a differant road to take. Well, if trading forex is boring except for the money, you are gonna find something differant to do and get money that way. I really think a person needs to be excited looking at charts. Watching bars go up and down and noticing a trade to start develope and getting ready to take that trade. There is so much more to this than making money. Someone on this forum said "It's not about the money, it's about the trade". I' know I am rambling so I will shut up now. I could talk about this for hours. This stuff is a passion.
JOHN 3:16
  • #12
  • May 25, 2006 12:16am May 25, 2006 12:16am
Quoting renasdad
I have to disagree. When there are so many people out there that are unable to do this due to whatever. There are many reasons they cannot. But, to be able to succed at this. Don't get me wrong, the money is gonna be great. I have told people about trading forex and they shake their head at me and tell me it is a waste of money. To be able to succeed and show that person, what a great feeling. I also know how hard this is. It is no cake walk. For me personally to be able to do this, how awesome. If you don't want to waste your day looking at charts, use a method/system that allows you to trade on 4hr charts or day charts. If it is only about the money, and you don't get excited about what you are doing, that is not an attitude that will work in the long run. It is kind of like, driving to work everyday. If you take the same road day in and day out and it is a boring drive, you are gonna get sick of it and find a differant road to take. Well, if trading forex is boring except for the money, you are gonna find something differant to do and get money that way. I really think a person needs to be excited looking at charts. Watching bars go up and down and noticing a trade to start develope and getting ready to take that trade. There is so much more to this than making money. Someone on this forum said "It's not about the money, it's about the trade". I' know I am rambling so I will shut up now. I could talk about this for hours. This stuff is a passion.
I kinda get this feeling that you've convinced yourself that trading is exciting. I really like Math, and I've done extremely well in all my College Math courses. Even then, I dislike looking at charts. I worry only about the money, and rarely loose money.
  • #13
  • May 25, 2006 12:24am May 25, 2006 12:24am
Quoting blueshift
I kinda get this feeling that you've convinced yourself that trading is exciting. I really like Math, and I've done extremely well in all my College Math courses. Even then, I dislike looking at charts. I worry only about the money, and rarely loose money.
I guess we will just have to see who has thier face on the mat at the end of the twelvth round now won't we.
Nolite dormiens pungere ursum. -- Latan Proverb.
  • #14
  • May 25, 2006 12:29am May 25, 2006 12:29am
Quoting fxm996
I've got to agree.. whether its stocks, futures, or forex, at the end of the day its all about the money for me.
Im extremely passionate about trading - and i believe this is something that resonates on my excel spreadsheet at the end of the month - when i write in my performance, and notice the consistency i have achieved over some months.

To be in it for the money is going to get you no where, and will eventually play you out of the game.

The best traders in the world only have money as a bi-product of their passion.

Even Bill Gates the richest man in the world, is only super rich, cause money is a bi-product of his passion in computers.

Warren Buffet - super dooper rich, cause money is a bi-product of his passion which is investing.

Mr. Whipple - awesome post mate!
  • #15
  • May 25, 2006 12:30am May 25, 2006 12:30am
Quoting Joe Ross
Hey Joe! I’m struggling. My home life is not conducive to trading, and I’m not sure whether to continue. I’m not even sure of which things are important.
Here are some things you can do:

*Get a new life partner
Get a new home
Find a private trading office outside of home
Start a trading group and group trade
Trade fundamentals from the office, if you have a day job.
Trade from a friend's home
Bring laptop to Starbuck's and Trade
*Find a guy/gal on the side, trade, and get stress relief too.
Etc.

* I am not suggesting any cheat on a relationship.
  • #16
  • May 25, 2006 12:31am May 25, 2006 12:31am
Quoting renasdad
If you take the same road day in and day out and it is a boring drive, you are gonna get sick of it and find a differant road to take. Well, if trading forex is boring except for the money, you are gonna find something differant to do and get money that way. I really think a person needs to be excited looking at charts. Watching bars go up and down and noticing a trade to start develope and getting ready to take that trade. There is so much more to this than making money. Someone on this forum said "It's not about the money, it's about the trade". I' know I am rambling so I will shut up now. I could talk about this for hours. This stuff is a passion.
I understand what you're saying, however... do you get excited trading demo accounts? Not likely. Yes, trading can be exciting to an extent and it does give you a sense of accomplishment when you continually succeed at it, but success in financial markets comes down to how much money you make.
  • #17
  • May 25, 2006 12:36am May 25, 2006 12:36am
Quoting Rusty_forexman
Im extremely passionate about trading - and i believe this is something that resonates on my excel spreadsheet at the end of the month - when i write in my performance, and notice the consistency i have achieved over some months.

To be in it for the money is going to get you no where, and will eventually play you out of the game.

The best traders in the world only have money as a bi-product of their passion.

Even Bill Gates the richest man in the world, is only super rich, cause money is a bi-product of his passion in computers.

Warren Buffet - super dooper rich, cause money is a bi-product of his passion which is investing.

Mr. Whipple - awesome post mate!

And if I could add to this, look at any singer in the world. They didn't wake up one day and say "hey, I want to become rich, so I am gonna become a famous singer". No, many of them started singing when they 3 or 4 years old and just loved it. They didn't even know what money really was at that time. With age, they grew and learned how to really sing and had a PASSION for it. It is about so much more than money. Now it is back to my day job to make the money
JOHN 3:16
  • #18
  • May 25, 2006 12:46am May 25, 2006 12:46am
Quoting fxm996
I understand what you're saying, however... do you get excited trading demo accounts? Not likely. Yes, trading can be exciting to an extent and it does give you a sense of accomplishment when you continually succeed at it, but success in financial markets comes down to how much money you make.
Yes I DO get excited on a demo account. I love it, it is the greatist video game on the web, and it is FREE. Wow! you can't beat that with a stick.
Nolite dormiens pungere ursum. -- Latan Proverb.
  • #19
  • May 25, 2006 12:50am May 25, 2006 12:50am
Quoting fxm996
I understand what you're saying, however... do you get excited trading demo accounts? Not likely. Yes, trading can be exciting to an extent and it does give you a sense of accomplishment when you continually succeed at it, but success in financial markets comes down to how much money you make.
I demo traded for 2 yrs. It is great. And like Mr.Whipple says, its the best video game and it is free.
JOHN 3:16
  • #20
  • May 25, 2006 12:51am May 25, 2006 12:51am
Quoting MrWhipple
Yes I DO get excited on a demo account. I love it, it is the greatist video game on the web, and it is FREE. Wow! you can't beat that with a stick.
Can't beat it with a stick, but I can beat it with a live account which afterall, is the reason these "video games" exist.
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