Indices Psychology & Risk Management PDF

Indices Psychology Articles

When it comes to trading as a beginner trader you will need to execute your stock trades like a professional trader, without any emotions when trading, or without being influenced by price movement not that when the price has moved up so much you decide that you now need to open a buy trade because the upward price move has really moved a lot pips.

So to trade like a professional trader - as a beginner trader you need to transform your trading psychology. To transform your trading psychology then you will require to write down the psychology rules in your plan which you will follow when stock indices trading.

The example explained and illustrated below shows how to write the psychology rules

Indices Psychology & Risk Management Tutorial

• I Trade without Emotions (fear, greed, anticipation, bias, impulse, over-excitement)
• I trade what my eyes see on the charts not what I feel.
• I will be patient when trading.

My job description is not to be the trading system!

It is not to decide which stock trades looks promising.

That is the job of my trading system. My system has a set of rules that tells me this is what I follow. Don't get caught up in price action movement and make rules as you go along.

MY JOB DESCRIPTION IN Indices TRADING IS

To sit patiently & wait for my system to indicate that it is time to enter a trade or it is time to exit a trade. And then with great focus I execute trade as planned on my indices plan.

Taking stock trades not indicated by the system, second guessing the stock system & not taking stock trades given by the system, hesitating and getting in to a trade late, anticipating and getting in to a trade early are all common place in stock indices trading and boil down to lack of faith in the stock system & not having a burning focus on accurate execution of stock trades.

Indices TRADING GOAL: To have 100 Percent undivided desire on mastering my ability to execute my trading system accurately.

As a trader the more you develop the ability to step back from price movement and watch market dispassionately, waiting for a signal to trade, the easier it will be to witness the fluctuations of your trading emotions without getting sucked into them and allowing these emotions to throw you off your plan.

By writing psychology rules like the ones above on your plan - then as a trader you'll start to follow your stock system & trade more like a professional trader would if the system you are indices trading with was to be automated.

The more you follow these psychology rules the easier it will become to trade the market without being influenced by the various stock market price movements.

As a trader always make sure that you're opening a trade because the rules of your system have been met and a signal has been generated and not because you have seen the price jump and so now you decide it is time to open a buy trade.

By following rules a system then you will be able to trade more like a professional trader and follow the rules of your stock system & your results will improve.

Changing your psychology will not be a very easy thing and this is why as a beginner trader you must constantly make an effort to follow the rules specified in your psychology section on your plan until the time you master these psychology rules and you can trade the market without emotions & trade like a professional trader.

To learn and know more about psychology read the following psychology & risk management guides:

• Indices Psychology Guide
• Indices Psychology and Risk Management Emotions Fear & Greed
• Indices Psychology and Risk Management Psychology Principles
• Learn Psychology & Risk Management Psychology

Indices Psychology for Traders - Indices Psychology Lesson - Indices Psychology Articles - Indices Psychology Books.