Here are a couple of suggestions, I am in no way going to suggest that these suggestions encompass everything one needs to know about trading but it can seriously help you become a better trader/investor.
1) All popular magazines, news articles and TV stations should be used only for getting information on what you should not do, in other words if they tell you its time to buy gold, its time to get ready to sell, if they tell you the market looks like its going to crash, we are probably close to a bottom etc
2) Spend time learning TA, this is very important. Do a simple Google search and you will find many sources of free info, or you can join our mailing list and we will provide you with access to the most comprehensive list of market tools and they are all free.
3) Have a plan. Don’t be a fool and sit there wishing for that big kill, those that do so, always catch a falling dagger, and everyone knows what happens when you do that.
4) The plan should include profit targets on each and every trade, plus and this very important, an exit plan, in case the trade does not work out.
5) Never ever, ever I will say it one more time, play Options only, it should be part of your investment plan but not your only plan. You are far better of playing futures if you are going to waste all your money on options only, futures are much cleaner, less slippage, less spread and you can get a feel for it because you can study the pattern of one market. I am not saying that everyone should get up and play futures, but if you are going to be a fool and play only options, then the wiser thing to do would be to learn futures and attempt to get in tune with one of the markets i.e. Dow futures. In addition remember the saying “A fool and his money are soon parted”; having said that options are absolutely fabulous instruments to lock in spectacular profits.
Let me talk about something I mentioned some time ago. I stated that with proper money management one could lose his entire options portfolio and still walk away with a profit.
We will use a 100K portfolio for this example
10% is 10K
Okay you lose the entire 10K by playing options idiotically.
Now you play nice and safely with the other 90K and you make 30% for the year. Don’t say it’s not possible; all of you who have long term positions in Gold are up more than 30% this year alone. Just catch the major trend and follow it. So you make 27K that brings the total to 117K but lets say you make only 20% that brings the total to 108K, you could even make 15% and still walk away with a profit.
The key here is that you live to fight again and then you can take some of these profits and play options once more
6) Learn to relax; if you don’t relax it’s really hard to win.
7) This last rule many of you might or might not agree with me, help one person in your life time and your rewards will be 100 fold.