- Foolish traders confuse hindsight with trading. They think that because they reviewed price performance history, and saw patterns or results, trading in real time would be simple . They don’t understand that real time trading involves risk management, discipline, and a developed trading plan and probably never will.
- Foolish traders believe that what they learned in textbooks will make them great traders. They are used to being able to supply the ‘right’ answer for a good grade, but the markets are a moving target, and the right answer changes daily.
- A foolish trader thinks that trading real money in an actual account, followed by a sustained track record, isn’t required. Developing a plan, practicing, and learning from wins and losses is the only way.
- A foolish trader’s opinions and theories have no basis in reality when trading six figure or multimillion dollar accounts. ‘In theory, there is no difference between theory and practice. But in practice, there is.” – Yogi Berra
- Foolish traders make blanket statements like “Day trading doesn’t work.” When they should be saying: “Day trading doesn’t work, for me.” -Richard Weissman.
- Foolish traders come into social media trying to be teachers when they should be students. They don’t even know what they don’t know.
- Foolish traders have a recency bias. They think that what works in the current market environment is what will always work.
- Foolish traders develop too much confidence before they have built competence, and that never ends well.
- Foolish traders have made up their mind and cannot be swayed. This is the opposite of successful traders who remain curious, always seeking to learn and grow in all areas of life.
- A foolish trader has no need to interact with other traders, read books, or learn from more experienced traders. In their mind, they already know everything.
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