Trader Quote #19Posted: October 4, 2012
Trader Quote #19
“A good trader watches his or her capital as successfully as a professional scuba-diver watches his or her air supply.” – Alexander Elder
==== Fantastic quote from Mr.Elder , it has a great visual analogy that anyone can relate to & always keep in mind. Our trading accounts are like our “air supply” , keep it simple = No Money No Air. So its more about “how much you keep at the end” rather than “being right most of the time” . That is why there is a whole universe of Money/Risk Management, where capital preservation is its core function.
Many traders, no matter if novice or advanced tend to forget this at some point of his account history (including me). They begin very risk disciplined , then a few months later they get off-tracked. That is why I have a huge poster saying “Capital Preservation” as my #1 Rule. There is no point in being 99% accurate if in one trade you “blow up” your account.
I like to think of it in Probabilities. I ask myself “how many losing trades (fixed loss) in a Row would it take, to Lose all my account” From their, I focus more on the Risk Side rather than on the Accuracy Side. Remember ” NO One can PREDICT the FUTURE, you can ONLY Control your RISK” good trading, Dimitri Feria====
What do you think about this quote? Do you agree? Any experiences you want to share?