1st Phase: Learning
New traders, this is learning markets, macro/micro, what drives markets historically/‘normally’. Developing and experienced traders, it’s identifying a change and trying to work out where to utilize time and effort. Both size it small as to limit draw down.
2nd Phase: Implementing
Once you have worked out what’s working, you start to implement that type of trading for that market, working out how to best IMO like this your learning’s.
3rd Phase: Scaling
Start to scale your size and/or universe depending on your personal skills. Some like to be bigger in less names and some like to be smaller and spread their cash around. This comes down to your skill set as a trader. Are you fast in a keyboard? Etc.
4th Phase: Making Money
Once scaled, you really start to push yourself, finding the best trades for yourself and honing your skills. As this phase comes to an end you will notice sudden draw downs and mental frustration. You need to them identify if this is the market, or you and if it’s the market. Unfortunately it’s back to phase 1 again.
Repeat: Trading is hard work and it’s never ending hard work! So be aware you are always trading against a fluid moving market, you will never ‘get it’, it’s always going to throw you a new challenge!
This has been brought to you by @ Cyclops_Trader on Twitter.