Freecell said
Hi Theo, thank you for providing so much free material, and thank you for clarifying things along the way with your responses to various questions in these threads.

In the free E-book - Chapter 10: Trading Psychology - you write about Mastering Patience and Following Rules.  Clearly this has been one of my failings (and still is) with trading, so I wonder if you could answer any of the following (hope this is not too personal):

Were you born a master of patience?

Did you learn to master patience and if so how did you do this?

Are there any particular techniques for mastering patience and folowing rules that you can recommend?

 

Thanks, David

Hi David,

Not too personal at all no, and a HUGE part of having any chance of consistent success. 

I was far from born a master of patience,
I would actually say I was born a failed student of patience who skipped class
There are a few things I would attribute to me overcoming the very natural lack of patience most of us have.

1. Developing a rinse and repeat set of rules to follow,
   then proving to myself in the backtester that when followed these rules work well and I can follow them.
   *this builds up your confidence that you are capable of following the rules and it does result in being profitable.
   *the backtesting however can be done with a 4 hour candle closing every few seconds so this only helps with the patience in waiting for a trade that follows your rules, not the same as real life but a good start. There is also no real risk at this stage.
2. Having good gains when following the rules live, then losing some of those gains as soon as you stop following them.
   *This basically drove home why it is not worth trying live something unproven to yourself long-term, if you really thought that this new thing outside of your rules was valid then back to #1 above with it.
   *Don't forget here though that the extra risk you just took not following your rules may also work out and be a winning trade for you, this is a trap and if it worked out then lucky you and back to #1 with it.

As you can see so far the first step towards building patience is building confidence in what you are doing. If you are 100% certain that the way you interpret the market based on the rules you have really works, then you can eliminate second-guessing yourself. You can't work on Patience whilst second-guessing yourself because what are your being Patient for?

Sorry this is getting drawn out but this is worthy of entire books so getting it all in a post is hard 

OK, so..
becoming 100% confident in the fact that what you are doing actually works AND you are able to execute it.
= something to be patient for/a reason to be patient.

The backtester is underrated in my opinion and most will tell you that it's not the same and there is no emotion etc etc, the same applies to a demo account. Really I agree with that but dealing with your emotions is another part of this, one step at a time is the smart way to go. Using the backtester you can trade in a way that the charts are moving along exactly as they would in real time, only much faster so you can get more practice in and speed up this part of the learning process. I worked with a programmer for some time and developed an amazing tool to trade the backtester exactly as you would live (part of my VIP package). No up-sell intended with that comment, just want you to know how worthwhile I consider this part.

Once you have something to be patient for via proven results you can do the same thing on a demo account for a while, this is where real life 'time' patience can be mastered. You are moving on from the patience required to wait for your rules to be in check at high speed (rules that you have proven to yourself work) to waiting for the same thing in a much slower environment.

If you can do all that then starting with a real money account will only include dealing with fear of loss/emotion and is easily overcome when you realize you will lose more by not doing what you have been doing up to that point. Another good mind set to have is to completely disown any money you put in a trading account, pretend it is already lost and forget about it. Furthermore, set your MT4 to display profit/loss in pips and not money. At this stage you only need to keep doing what you have been doing and forget about the money. 

I hope this helps in some way, that is a self analysis of my journey in trading patience and some steps I took to overcome it as fast as safely possible. It has also come through in my real life personality, I am much more patient now than I ever was. People that have known me for years often comment on how patient of a human being I am. It makes me reflect on how impatient I actually was.

Theo