Inspiration-Increase Your Earnings 1000%!

helo all,
i'm quite into inspirational and motivational articles and books on a pyschlogy point of view, is good for traders.some arthurs i like are reading zig ziglar, brian tracy, napoleon hill,og mandino but the one that coth my attention was brian tracy.here's something from him,

Increase Your Earnings 1000%!
By: Brian Tracy

Here's an exercise for you; imagine that it's possible for you to ear n ten times your current annual wage. If you're earning $25,000, imagine for a moment that it's possible for you to ear n $250,000, a 1000% increase.

Believe In Yourself
The first reaction of most people to that exercise is to smile briefly and then to begin thinking about why it isn't possible. One man said to me, "If you knew how many years it's taken for me to get to what I'm ear ning today you wouldn't be suggesting that I could ear n ten times as much."

There Are No Excuses
Mark Twain once wrote that there are a thousand excuses for every failure but never a good reason. The tragedy of the average American is that whereas his or her main preoccupation seems to be money, or the lack thereof, the average person has the inherent potential to ear n far more than he or she is doing currently.

Can Someone Be 10x Better?
Is the manager ear ning $250,000 per year ten times as smart as the manager ear ning $25,000? 10 times as experienced? Does he or she work 10 times harder? Of course not. None of these are physically or mentally possible, but there are people in every business ear ning many times more than others with the same average age, experience and intelligence.

I.Q. Doesn't Really Matter
In fact, a few years ago in New York, a thousand men and women were selected at random and tested for I.Q. Between the one having the highest I.Q. in this sample and the one with the lowest, there was a difference of only 2 1/2 times. But between the person ear ning the most, who by the way, was not the one with the highest I.Q. and the one ear ning the least, who was not the one with the lowest I.Q., there was a difference of 100X in inc ome.

Action Exercises
Here are two things you can do to start increasing your earnings:

First, identify the highest ear ning, most successful people in your field and find out what it is that they are doing differently from others who aren't doing as well. Resolve to copy them every day.

Second, set a goal to double your earnings over the next two or three years and then figure out what you'll have to do to achieve it. Get started!

helloo,very insightful article on trading pyschology.wish i'd read it ealier

At investment conferences, the hottest speakers are those who provide information about high probability entry techniques. If you say, "Trade with the odds on your side" and show someone a technique that is right 75% of the time, you’ll get a large audience. Yet most techniques of this nature usually have big losers and may not even have a positive expectancy. Nevertheless, being right 75% of the time is all is takes to get people to trade them.

How important is it for you to be right? Let’s say I could guarantee that you would make money by the end of the year—lots of money—but you would probably lose money on 90% of your trades. Would you like that? Could you tolerate that? Would you accept that? Most people would probably answer "no" to all three questions. And if that is you, you probably are denying yourself the opportunity to make money simply because being right is more important than making money.

Some of you might be saying, "How could you be wrong 90% of the time and still make money?" The solution goes back to the golden rule of trading, "Cut your losses short and let your profits run." Let’s say that 90% of your trades lose money and that your average loss is $100. On the year you make 100 trades so you end up losing 90 of them for a total loss of $9,000. However, let’s also say that your average winning trade is a big R-multiple. It’s an R-multiple of 100 or a $10,000 winner. You have ten of those in a year, so you end up making $100,000 on your winning trades. If you subtract your winnings from your losses, you’d end up with a profit of $91,000 at the end of the year. You make $91,000, yet 90% of your trades are losers.

My guess is that 99% of the trading population could not trade a system that would produce those kind of results. The reason is because they don’t get to be right enough. They have too many losing streaks. They have losing streaks that are longer than five in a row. Most people cannot tolerate long losing streaks. When they occur, they totally abandon what they are doing. In such a system you could easily have 25 consecutive losses. At that point you become certain that your system is broken, and you try something else.

Let’s look at the opposite end. Suppose you got to be right 90% of the time. Suppose your average win was $100 and that your average loss was $2,000. This means that you’d have a total of $9,000 in winnings and $20,000 in losses. You would lose $11,000. Would people trade that system? Yes, they would. They would probably trade it for a number of years until they went bankrupt. Why? Because they get to be right most of the time and that is very rewarding.

You might be saying, but how could people possibly tolerate losses of $11,000 after 100 trades? It is easy; they turn the losing trade into a long-term investment in their mind and say, "it’s only a paper loss." For example, I’ve had workshop attendees who were probably way above average in terms of sophistication. However, I asked them to raise their hands if they had an investment in their portfolio that was only worth 50% or less of what they paid for it. Eleven people raised their hands—over a fourth of the class. And my guess is that among the overall population of investors, most people are sitting on a number of big losers, hoping they will come back. Why? Because they cannot stand to be wrong on an investment and they are waiting to be right on those losing trades.

What is the cost of having losing investments in your portfolio? It’s major. First, you are using valuable capital up with nonproductive investments. Second, you are missing many good opportunities.

Why Being Right Seems So Important
There are two primary reasons why we focus on being right. First, we are conditioned to be right by the school system. Second, everyone in the trading industry gives people what they want—ways to be right—which tends to perpetuate the myth. Let’s take a closer look at these two reasons.

First, we are conditioned by the school system to the importance of being right. In school you are taught that there are right answers and wrong answers. What is a right answer? If you learned how to survive in the system, you learned that a "right" answer is whatever the teacher wanted.

Your performance is measured periodically through tests in which you are asked to pick the right answer. If you cannot get more than 70% right on the test, you are labeled a failure and ostracized. Your humiliation might even be in public in front on all your friends. And if your humiliation isn’t public, it certainly is semipublic. Your "poor" performance goes home in the form of a grade with a comment that "Johnny is a little slow or Johnny is bright, but he just doesn’t try." Usually, at this point, the most important people in your young life get involved—your parents.

Even if you understand the system and work hard to know the right answers, you still might be taught that your performance is not good enough. It usually takes 94% right to get an excellent grade. But how many children go home and show their 94% test to dad only to get the response, "Why didn’t you get 100%?"

Thus, it is no wonder that traders want to be right all the time. And being right usually costs them dearly in terms of profits. Whether you’ve been through 20 years of schooling and have a graduate degree or less than 10 years of schooling, you still have the same conditioning about being right.

The second reason people want to be right is that service providers for traders and investors feed the bias to be right. First, software vendors tend to provide systems that can be highly optimized. Once you’ve optimized your trading, you can lay a line over the prices and see exactly where you should have bought and sold. It seems obvious. However, the same optimized system does very poorly when applied to the real world.

The Solution: Expectancy
What you must do now that you are trying to survive in the real world is learn about expectancy. By definition expectancy is how much you can expect to make, on the average, over many trades. Expectancy is best stated in terms of how much you can make per dollar that you risk. I cover this important topic as well as detailed instructions on how to calculate expectancy. My objective is to show you how to incorporate expectancy into a successful, profit generating trading system.Risk to reward ratios are what you use for it.