- 1 Why We Love Mind Hack (And You Should, Too!)
- 1.1 1. Ideas Notepad
- 1.2 2. Backtesting Strategy
- 1.3 3. Learner Mindset
- 1.4 4. Review Your Stress Situations
- 1.5 5. Reading
- 1.6 6. Disconnect
- 1.7 7. Taking a Break
- 1.8 8. Act on Ideas
- 1.9 9. Get Help To Review Your Trades
- 1.10 10. No Shortcuts
- 1.11 11. Trading Plan
- 1.12 12. Productivity over Activity
- 1.13 13. Routine
- 1.14 14. Focus
- 1.15 15. Writing
- 1.16 Over To You
Why We Love Mind Hack (And You Should, Too!)
Being an Optionpreneur is a tough task. Being a full-time Investor or Trader is also a tough task. Anyone who is saying you otherwise is lying to you.
Being a full-time trader and investor requires the maximum mental strength.
Especially during the initial stages when you are yet to establish yourself and your learning curve is growing fast. You are sure that returns and benefits would come. They are just unrealized. That’s the toughest part to manage.
You are always a race against time. More things to be accomplished in a very short time.
This is what can at times be a hindrance and challenge yourself. I have compiled these hacks to ensure that you can easily cross your first few hurdles were most of them give up. Once you are through your first few hurdles then going gets better.
Here is the List of Mind Hacks for Newbie Investor & Trader
- Idea Notepad
- Backtesting Your Strategy
- Learner Mindset
- Review your Stress Situations
- Take a Break
- Act on Ideas
- Get Help to Review your Trades
- No Shortcuts
- Trading Plan
- Productivity over Activity
Let’s get into the details how each of the points can create a better Trading and Investing environment for you. In stock trading and investing most expensive way to learn lessons in a practical way.
1. Ideas Notepad
The journey over optionpreneur or investor is very unique. Before starting you would get a maximum number of ideas to start your investing and trading journey. Next best time you would get ideas is when you have invested or traded into a position.
Most of us either implement all the ideas immediately. Or once the period is gone we do not even remember the idea.
Both has its own advantages and disadvantages.
If you are implementing your trading ideas that arise during trading hours you are not going to succeed. Since there is no backtesting done, an absence of a trading plan, etc.
The second type of person can handle this by ensuring that their Ideas are noted down. Follow the entire process of validating the ideas before implementing.
We usually suggest a free app which can easily get connected to your Gmail account its Google Keep.
2. Backtesting Strategy
Except for your Investing strategy all the other strategy can be backtested with various tools available in the market.
Strategies that can be back tested are.
- Stock Options
- Stock with Currency Options
- Single Leg Option Strategy
- Multi Leg Option Strategy
- Stock with Options Strategy
- Index Options
- ETF with Options Hedging
- Futures with Options Hedging
- Stock Options with Interest Rate Futures
The list goes endless. Investing alone cannot be back tested.
Now, why is back testing so important. Your stock market guru has suggested you a strategy. Or your very close friend has suggested you a strategy who has been doing well with this strategy and getting good returns. Or you have heard that Investing Guru has earned a lot of money with this particular strategy.
Firstly, every trading and investing strategy do not work for all. The strategy which is working for you might not work for someone else and vice versa.
The strategy is a very personal thing. Becuase your nature and emotional intelligence plays a very important role in establishing which is the right strategy for you.
There are 3 popular Income Generating Strategy as mentioned below.
- Naked Put & Call
- Credit Spreads
Everyone does not succeed in all the strategy you have to choose which is the right strategy for you.
Secondly, when you backtest the strategy you understand what is required for you to succeed in the strategy.
This gives you a confidence during the negative returns but keeps you up since you are confident that in long-term the strategy is going to perform better.
3. Learner Mindset
People usually with a wrong notion that Stock Trading is gambling or speculating think that one does not need to learn. That’s totally wrong.
People those who say that are not aware of how trading can be done. Especially optionprenuers would vouch for this. Initially, it would have been very tough for them to explain people around them what their nature of the job is.
The world is simply divided into two learners and non-learners. It is a basic aspect of self-realization.
Does an expert need to have a Learners Mindset?
It is always because a person has learners mindset especially optionpreneur he is an expert. One cannot become an expert with non-learners attitude. A learning curve has no end only ups and downs.
This is an interesting infographic which shows what it takes to etch learning mindset from an early stage.
4. Review Your Stress Situations
You shouldn’t be holding your breath on every trade.
If you have a habit of looking at your positions every minute and you are not able to get off the screen. Even a little momentum in the stock market gives you a stressful situation then it’s a matter of concern.
This is one of the most stressful situations for most of the traders.
Being a trader or investor is stressful.
If you have planned your trades and if you are going as per your plan then surviving a loss would not be a challenge.
Nevertheless, there is a positive way of managing stress and negative way of managing stress.
Stress is inevitable. But what is possible is how you manage the stress.
Negative way of Managing Stress
- Ignore the Problem
- Start Thinking Negative
- Bad Habits
Positive way of Managing Stress
- Get out of Trading Room
- Re Backtesting
- Visualise Calm
- Unlearn & Learn
- Open air Walk
How you react to stress is more important than the stress itself. Stress is an integral part of the trader especially those who are trading hap-hazardously.
Choose your best fit for managing the Stress.
This is the most favorite of all at Alpha trading.
It’s not without a reason that we have kept a separate section for Reading List.
Reading at a time gives you better avenues to improvise your current trades. Also, it’s a very effective tool in distressing. Reading has many forms it can be a newspaper, blogs, business magazine or even podcasts.
We are very soon Launching Optionprenuer Podcast Series.
What does Reading Give you?
- Mental Stimulation
- More Focus & Concentration
- Helps to Articulate thoughts
This is an Interesting Infographics which highlights all the points of Reading Benefits.
We are so much engrossed in our daily routine that we rarely get time to see what is going on outside.
I have met a person who was very happy when he got the Quarterly trading return of 12% and he was doing good. But when the returns of the strategy were compared with other traders using the same strategy was higher.
Most traders are in their own cocoon and they do not unplug themselves from their system.
Nowadays the trading system and price availability are so easily accessible that most of the traders all the time are hooked on the price movements. Either in Laptop, Desktop, Mobile Phone or in Office.
It is important to unplug once in a way.
7. Taking a Break
This is completely different from unplugging.
These are the advantages of taking a break.
- You get out of way from your own investments, remember all stocks perform better in long-term.
- How else would get out of the slate routine?
- Liberate your mind to think better.
- Avoid underscoring your realizations.
Travelling or taking a vacation is important. There is a very popular saying in the stock market. Sell in May and Go Away.
This is an Important Mind hack for Optionpreneur. Without this, you would lose your focus. And get into activity very easily.
These days technology break has become more important than any other break. Especially after the advent of fast charge, the amount of time one person is spending on the phone has increased drastically.
8. Act on Ideas
The first point we discussed is to Note down the Ideas in a notepad.
Now is the time to implement them. Don’t let go your Ideas. Backtesting every possible trading position with the ideas you have.
This will give you more confidence. Also of all the trading strategy, you would get the option of choosing the best of all.
Trying to test your Ideas on all the permutation and computations possible. So that you would know which are the best-performing strategies to be implemented.
Having said that you would be in a better position to Eliminate option trading strategies than Selecting it.
9. Get Help To Review Your Trades
Getting your trades reviewed by other and getting feedback from them is not only meant for loss-making traders.
Most of the time successful traders or trader with positive returns do not think that they need to get their trades reviewed. Getting your trades reviewed would have a different angle of thinking on the same trade.
Especially if you’re getting your trades reviewed from a person who has a different opinion then you would realize what is the opposite person thinking. In trading or even in investing every seller has a buyer. Knowing what opposite person is thinking will give you opportunities to improve your trade.
If you are already getting positive returns from your trading activities then this would help you realize better returns.
10. No Shortcuts
This is the best Mind Hack for Traders and Investors
Most newbie trader or investor enter during the bull market inspired or wrongly directed about becoming a millionaire overnight.
Promising returns which are not practically possible is the main culprit. Not only does it show that trading and investing is easy but makes the person believe that his positive returns are not efficient enough.
Keeping in mind that there are no shortcuts is the first step while entering into trading and investing.
Shortcuts make people take the easy route and more often most of the traders end up taking high-risk trading or investing strategies. One of the classic examples is multi-baggers.
No wonder the Google trends has shown higher searches for multi-baggers. The trend is in exact sync with stock market reaching all time high in India and USA.
11. Trading Plan
Failing to Plan is Planning to Fail.
This is one of the most Important Aspects of Optionpreneur.
Trading Plan keeps once mind at peace. Focus on more important aspect than worrying about trades giving negative returns.
Benefits of Trading Plan
- Limit your Downside
- How much money to use Per Trade
- Risk Management
- When to Exit
- Stop loss Management
- Identify Stocks to Trade
- Time of the Market to Trade
- Evaluate your Performance
- Key Performance Metrics
- Skill level
- Mental Preparation
- Set Entry Rules
- Post Mortem of Successful and Unsuccessful Trades
It might seem very easy but the fact of the matter is that most traders do not follow the plan. Even many experts have failed to follow the plan.
12. Productivity over Activity
Being a newbie Investor or Trader. You would like to achieve too many things in very little time.
Optionpreneur cannot remain active all the time with any opportunity. Mind Hack here is to self-introspect on daily basis to check if you are productive.
All that we want to do is be occupied all the time. Think for yourself. Is being active all the time is being productive. Your aim should be to be productive. When I started off I would focus on be being occupied all the time not realizing that being productive should be my aim.
The fundamental rule of being productive is to break down your yearly goals to daily to do activity lists.
For example, in Trading, if you have a task of earning an annual return of 25% – 50% then ideally you could break them down to a monthly return of 2.5% to 5%. Furthur has broken down to a weekly return of .60% to 1.20%. This makes the return achievable.
Similarly, if you want to read 50 books in a year. That might seem a very Herculean task all the time and it might never be achieved. You could get motivation and further in-depth knowledge from the book The 4-Hour Workweek written by Timothy Ferriss.
- Short List of Daily Tasks
- Repeat your most productive Tasks
Notifications are the trouble makers.
I just realized my phone knows when I get up. Notifications are sent only once I wake up. Researchers have found that at-least 70% of people start their day with social media.
Usually, the ideal idea for social media is to end the day with social media. How you begin your day matters the most.
Your day should start with highly motivated and oriented towards your goals. Many people start their day with email and that takes the course of the day. Should email really decide the course of the day.
Integrate your most productive work into your daily routine so that your efficiency increases of a period of time. They say that compound interest is the eighth wonder of the world. Likewise small productive tasks over a long period of time could really give you compounded results.
Focus definition, a central point, as of attraction, attention, or activity.
Focus on your daily tasks which would lead you to produce results over a long period of time. Use technology to find ways to remain focused on your tasks.
Set the tone of the day with following the daily tasks.
Following the task alone does not contribute to staying focused. If you are running a passive income business or if you are looking after other business the overall focus should be inside-out.
95% of the people struggle to stay focus.
Small steps over a period of time would lead you to stay focused on your key goals. This is one of the crucial Mind Hacks to get successful at what you are doing.
The last thing on the list. Writing!
Last time I asked my friend when was the last time he wrote something. He recollected to his surprise it was a signature on some government documents.
Everything has been digitalized. So is life.
Writing is the Painting of the Voice
When you start writing you get to listen what others are not saying.
Over To You
Had I read this early in Life.
The Simple Guide to Mind Hack for Newbie Trader & investor.
The lingering question if at all I had this early in life. Motivated me to write this article.
Come back here and tell us about the before-and-after. I bet you’ll have something to say!
My hard-work would go all waste.
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