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What are these universal truths? And why until now has no one mentioned them in a seminar or publication? The universal laws of trading are the virtues, vices, and strategies described in this book. |
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Who am I to state that there is a holy grail that everyone else has overlooked? How can I say that there are certain fundamental, irrefutable truths of trading? After all, many sophisticated traders have written books and taught a wide variety of trading methodologies. Why have they all missed what is so obvious? |
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The answer is straightforward. As far as I can tell, no one is willing to publicly admit that there are certain immutable truths about trading. These truths consist of certain internal beliefs and values that demand work and time to develop. They cannot be bought today, studied tonight, and applied tomorrow in the next trading session. |
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Immutable truths apply in every arena of life. In nature, fish cannot fly, and eagles cannot swim, yet both require oxygen to live. Skyscrapers must be built from steel and concrete, not wood, and must rise from a solid foundation. Rockets can escape to space only by obeying the laws of physics. So it follows that there are certain immutable trading truths that all successful traders adhere to. |
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Most new traders believe that success is achievable if they have enough money, determination, or creativity. Human nature wants to believe that anything is possible. New traders want to believe that they belong in the 10 percent winners' circle, and that they will enter that circle quickly and easily. Human nature also wants to believe that these immutable truths of trading are easy to set in motion, that they are mechanical, and that a computer can implement them. |
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If new traders stay at trading long enough, they will slowly start to accept that there are certain truths that must at all costs be obeyed. Once a trader accepts this fact, a lot of the stress, uncertainty, and frustration leaves. The challenge is that most new traders never get to that point. They quit before ever discovering that they lost their money because they were violating some if not all of the irrefutable truths. Once they open their minds to the truths in trading, it's easy for traders to see what they are. |
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I started trading stocks in 1976, physical gold in 1982, and U.S. Treasury bonds in 1993. Trading has been an obsession of mine for more than two decades. What I have found is that all outstanding tradersbe it in commodities, stocks, diamonds, or horseshave accepted certain immutable facts about what and how they trade! There are certain virtues that they have all worked to strengthen, and certain vices they have labored to annihilate. |
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