ZF Capital

Many books written about the stock market always remind you to paper trade, practice, practice. This I agree with, but paper trading is like having a practice fire drill, it is never quite the same as the real thing. However, the one point everyone seems to miss about paper trading is that those traders who can paper trade successfully in the first place already have a special gift. This gift will allow them to sit there all alone week after week with nobody to see, or even care about, the results, and not rush into a real trade impulsively.

– Tom Williams, The Undeclared Secrets that Drive the Stock Market

The stock market by its very nature is designed for you to lose money. The rallies and reactions within any trend ensures this process is at work constantly. It is created automatically. The market behaves this way because it has to! The weak have to perish so that the strong can survive. Professional traders are fully aware of weaknesses in traders under stress and will capitalize on this at every opportunity.

– Tom Williams, The Undeclared Secrets that Drive the Stock Market

Most traders will go into the market with great optimism and fail to have any plan because it does not enter their mind that they may be wrong. If they thought that, they would not be in the market in the first place. What do you intend to do if you are wrong? You are going to create problems for your self unless you have a clear plan in mind. Best of all, write it all down before you trade!

It’s not wrong to be wrong, but it is wrong not to recognise it immediately and to then cover your position.

Never trade unless you have plan ‘B’ ready and waiting to be activated without hesitation. This is a vital part of a good trading system. All this preparation is difficult because you are fighting the urge to trade, before you miss out on everything. If you plan for a failure before each trade, you will be surprised how successful you can become.

– Tom Williams, The Undeclared Secrets that Drive the Stock Market

You are entering a business that has attracted some of the sharpest minds around. All you have to do is to join them. Trading with the strong holders requires a means to determine the balance of supply and demand for an instrument in terms of professional interest, or lack of interest, in it. If you can buy when the professionals are buying (accumulating or re-accumulating) and sell when the professionals are selling (distributing or re-distributing) and you don’t try to buck the system you are following, you can be as successful aas anybody else in the market.

– Tom Williams, The Undeclared Secrets That Drive the Stock Market