Yes It Is!   Until you’ve actually traded the currency market, in fact probably any market, you could be forgiven for thinking that this trading mentality lark can’t be all that difficult!   Well…..  in reality it is, and you need to be very conscious of this fact and prepare yourself accordingly. 

I would say this is particularly prevalent to the Forex market, and I say this for the following reason……  I once attended a seminar on trading the stock market, and whilst I was there, I got talking with some of the presenters, as well as a number of attendees.  As you can imagine at one of these types of events, the first thing people do after introducing themselves, is ask if you are trading at the moment, and if so, how are you doing… 

Well, the reaction I got from nearly everybody when I proudly said “Yes, I do trade right now, but not stocks, I trade Forex”, was not quite what I had expected!  People would look at me like I was totally insane, some with a look of, what I can only term as, horror!  “Oh, and you’re doing well?”, as if they knew the answer would be ‘no’ before I had even spoken it!   And you know, the disheartening thing was, at that point in my trading, they were absolutely right!   I really wasn’t doing that well…. And at that point in time, it actually added to my ‘can I really be a successful Forex Trader’ mindset I found myself in…… 

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Just this week I was talking with another Retail Trader about the Markets…   I for one had made a decision to stay out of the markets on Thursday & Friday, and in fact so had my Trader friend, so we used the time to catch up on some trading chat!

Well, it wasn’t long before our conversation turned to Trading Plans.  We were discussing how difficult it had been to develop discipline in our trading, and that even today, we had to make a conscious effort to maintain the levels of discipline required.  I spoke about a learning model I apply that I had used in many business and self improvement situations, and it got me thinking that I needed to share this with you. 

This learning model is known as the Four Stages Of Competence and is a psychological process of moving from incompetence to competence.  Now the word incompetence, does not suggest ‘useless’!  I know in my youth, there was that association, and maybe for some of you too!  However, the actual definition is:- lacking qualification or ability.  

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Hopefully you will have read about my own experience of ignoring my own Money Management rules.  It was a very hard lesson, and hopefully you will heed my advice and ensure that you religiously stick to your own Money Management rules….  It really can be the difference between growing your capital, and losing it altogether! 

In case you have yet to define your own Money Management rules, I thought I would post some things for you to think about here on the Blog.  I hope you are able to take something from these to improve your trading. 

You need 4 key things for your money management rules, these being:- 

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