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The Secret to Increasing Your Trading

Profits Today

Hi,

I’m Vijay Bhambwani.

I want to tell you a very critical aspect of the trading the market: How you can groom
your mind to make even more profits than you already are making.

I like to remind people who trade for a living that we traders are brain warriors.

We are not needed to run faster than the other guy. We're not needed to swim faster
and longer than the other guy or lift heavier loads.

We basically our brain warriors. We fight and win battles in the financial markets with
our ideas.

It's not about the fastest computer. It’s not about the fastest refresh rate on our
trading terminal or the Internet connection. It's about the ideas and ideas come from
our minds.

So our minds must be like a well-tuned machine that's working at optimal levels at all
times and believe me, it's a lot more difficult than you think it is.

Human minds are not mechanical instruments. They also have emotions built into it.
So your left-hand side brain processes the logical functions, mathematical functions
of two plus two is equal to four and the right hand side brain is emotional, which
handles pain, fear, greed, and all other irrational functions from a mathematical
point of view.

Of course, at different points of time. The two functions do tend to overlap, so venue
on your trading terminal, you see a mark to market loss, no matter how mathematical

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you are some amount of panic, a little bit of sweat behind the ears, and a little bit of
nervousness does come in. That's the right-hand side of your brain influencing the
left-hand side of your brain.

And over a period of time, there is something called thought fatigue. Just like you
have writer's block, an author who is trying to write a book tends to feel fatigue after
writing a book for, say, three for five hours and needs to take a break, the human
mind also feels fatigue and it's a lot more tiresome than you actually think it is.

When you are under stress, your mind alone can burn one and a half calories every
second. When your heartbeat is pumping faster, when your blood is flowing much
more faster in your veins, all this, taxes your body. So you can actually tire yourself
out with stress.

Today, I want to put you through the paces of how you can prolong your shelf-life as
a trader for many, many ears.

I’ve been doing it for more than 33 years that I have been in the market. I entered this
market in 1986 and people ask me how I can manage to continue to trade effectively
in spite of more than three decades.

The answer is very simple: Stress management and trade and time management.

You see, we all as traders are human beings and as human beings, we tend to get
carried away by the last trade.

If it is a profitable trade, you feel like an emperor. You know it all. I know everything
that there is to about know above the market. I have attracted secret code and the
very next trade, chances are, my ego will play a bigger role than my brain and instead
of two lots, I might just wind up taking a risk of five lots.

That is a cardinal error. Why did it occur?

Because one did not allow the mind to cool off after winning in a good, big position,
and come down to rational levels before initiating the next.

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Guess what?

In the next trade, that you take of five lots, which, if it is based on wrong presumptions,
if it goes wrong, not only do you lose all that you made in the first trade on two lots,
but you wind up going out of pocket.

So lesson number one…after every big gain, take some time off.

Legend has it that Marcus Aurelius of Greece, hired a slave whose only job was to ride
in the chariot with him whenever he went out in public because the people would
cheer. The slave’s job was to whisper in his ears, ‘Remember, you're only human. You
are not God. You're only human.’

This was to bring Marcus Aurelius down to earth so that he did not give any statement
that was out of the ordinary.

We human beings, we traders especially, need to remind ourselves that no matter

how good we are traders, the market is supreme. If you think you know at all, if you
think you've cracked the code, hey, the very next trade, the market might just humble
you.

So after every big trade, it is essential that you cool off.

And what better way to cool off, than to spend the fruits of your labour!

Depending on how much you want to segregate for yourself and depending on the
quantum of the trading profit, I would say between 2 to 10% of the winnings, to
spend it on something that you like.

It could be buying an ice cream or that round neck T-shirt that you wanted, a pair of
running shoes that you wanted, or if the trade as big enough and the profits are big
enough, that new motorcycle that you always had your eyes on, a foreign holiday,
maybe.

Why surrender money to the market and break your morale when you can spend it
on yourself and earn a feel-good factor for your brain, so that it functions better in
your next trade?
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Now this is after a gain. A similar situation arises after a loss-making trade. We are
down to the ground. We have beaten but not yet completely broken.

Sometimes, and it happens with me very often, I want to take revenge. The market
has taken my money. I'm gonna earn it right back from it.

Now this is a gambler's fallacy. You want to get even with the market. You want to
take a revenge. Doesn't really work because the market is supreme.

So here again you might wind up taking out-sized bets. You might wind up taking
more risk than you actually should and deplete your capital.

To my mind, a trader when he or she loses money, can replenish the money but
if your morale has broken after a loss-making trade, that takes its own sweet
time to heal.

Remember, the right-hand side of your brain, which is emotional, does need a little
bit of rest and recuperation to come back to normal. Give yourself time after a loss-
making trade. Go back to the drawing board. Introspective and think about where
you went wrong, what really went wrong so that you do not repeat that same mistake
again.

So after every winning trade and after every loosing trade, you must take a break.

As an investment adviser for many years, I faced a lot of pressure from people who were
basically dependent on me for advice, as to why I give infrequent recommendations.

The answer is here. I am sharing my innermost secret with you. This is my secret
sauce. I don't want people to trade too often. After every profit, take a break. After
every loss, take a break.

What you should have is high probability trades that keep earning you money
consistently.

There's no point in earning Rs 2 lakh in 1 month only to lose it back in the next. You
wasted two months of your life and you're back to square one.
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So maybe in trading, less is more. Make haste slowly. Remember, we are brain
warriors. Do not upset your mind after every loss-making trade by forcing yourself to
take a revenge with the market. Nobody can take revenge from the market.

And here again, like I said, the more you work efficiently and let your left-hand side
brain dominate the right inside brain, you can continue to trade for longer periods of
time and have a winning streak of 20, 30, 40, and maybe even 50 years.

So that, ladies and gentlemen, is the secret to making money in the markets over
longer periods of time.

Thank you and have a profitable trading day!

Warm regards,

Vijay L Bhambwani
Editor, Fast Profits Daily
Equitymaster Agora Research Private Limited (Research Analyst)

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