Skip to Main Content
The Truth About Day Trading Stocks: A Cautionary Tale About Hard Challenges and What It Takes To Succeed
book

The Truth About Day Trading Stocks: A Cautionary Tale About Hard Challenges and What It Takes To Succeed

by Josh DiPietro
July 2009
Beginner content levelBeginner
208 pages
4h 39m
English
Wiley
Content preview from The Truth About Day Trading Stocks: A Cautionary Tale About Hard Challenges and What It Takes To Succeed
CHAPTER 3
Preventing Overconfidence
With remorse I think back to my excessive confidence, back when I was fresh from my first training program. I was using what I’d been taught to believe was a wonderful, “bullet-proof” system. I actually had so much faith in myself that my initial losses didn’t bug me.
But I got over that fast. My losses were so consistent that I had to. And then I desperately needed to know just why I was losing so much. The first thing I started to realize is that I was too sure of myself.
Confidence in trading styles is similar to the way a busy cook relates to his pot mitt. The wise cook, no matter how harried, always takes the time to put on his mitt before he grabs a pot off his stove.
So it’s not the inanimate mitt that protects him; the bottom line is that it’s the cook himself. Knowing when it’s necessary to put that glove on and having the good sense to do it is what he’s really relying on. Accordingly, the day trader must fully understand that it’s his judgment, much more than any system he’s learned, that affects his trading the most.
Confidence, just like the cook’s pot mitt, is a tool. If the trader’s confidence wildly balloons and he becomes zealous, stubborn, or careless, then he’s just like the heedless, inexperienced cook who thinks he’ll get by without his mitt. In both of those scenarios, overconfidence burns.
I’m aware of no chart pattern or stock analysis methodology that shows you a confidence factor. No system will tell you to buy or sell ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Start your free trial

You might also like

Trading Secrets: Killer trading strategies to beat the markets and finally achieve the success you deserve, 3rd Edition

Trading Secrets: Killer trading strategies to beat the markets and finally achieve the success you deserve, 3rd Edition

Louise Bedford

Publisher Resources

ISBN: 9780470495858Purchase book