How to Stop Overtrading: Trading Psychology Made Easy, #2

By LR Thomas

How to Stop Over-Trading
is the latest book in the trading psychology series of books by L.R. Thomas. This book zeroes in on the specific reasons traders take trades outside their
trading plan and offers simple solutions to stop over-trading forever.

The truth is that if a trader consistently trades outside their strategy, even on a demo platform, they are very unlikely to succeed in trading. This book
offers simple but effective solutions, just like the other L.R. Thomas trading psychology books 'Control Your Inner Trader' and 'Overcome Your Fear in Trading'.
 

If you are skewing your trading results by taking trades that you shouldn't, then this book could change your trading, for the better, forever.

 

Reader Reviews

 

Reviewed in the United States on April 4, 2018

Of the 3 book LR Thomas collection, Which I enjoyed very much, I found this one to be the most valuable. The entire series is excellent and has some effective solutions for the problems that plague many traders. What I found most valuable was that the author explained many of the same issues I face and provided some excellent advice. Just defining the problem was enlightening. And it's great to know that I have some new tools and techniques to help me get back on track.

Raymond R

 

 

 I wish I had read this 90 days ago

Reviewed in the United States on December 23, 2014

I don't rate books very often but feel compelled to do so with this one. True story: In three months, I over-traded and gambled away approximately 25% of my life savings. This, despite the market making new highs almost daily. I was in despair, not knowing what to do. This book gives me hope. It gives me strategies to ensure I am trading appropriately, and if I had read this book beforehand I would certainly not have been so foolish with my money.

TX Reader 2

 

Excellent book with plenty of ideas

Reviewed in the United Kingdom on February 20, 2015

Excellent book with plenty of ideas to help me in my trading. Have implemented some already and have found them helpful.

 

Delores

• Language: English
• Publisher: LR Thomas
• Release date: Oct 7, 2020
• ISBN: 9781393028772

LR Thomas

I have been a trader for 10 years and I know what a struggle it can be. I have been using my systems for the past two years and I decided to share them with other traders so they can hopefully short cut their time to becoming a profitable trader. I post updates on my blog http://10XROITradingSystem.com to answer questions from my readers.  I am also a qualified therapist and have written books to help traders with their trading psychology. You can visit my trading psychology blog http://traderselfcontrol.com to find out more about the ways I help traders with their trading psychology.

Book preview

How to Stop Overtrading

Overtrading is a generalization for describing one of the most destructive behaviours that a trader can engage in.  However, the problem with generalizations is that they don’t help to pin down the issue to its component parts and analyse where the real problems lie.  In order to stop overtrading, we need to know what is the specific catalyst that causes us to indulge in that specific overtrading behaviour.  There may be a few catalysts that mean we over-trade in different ways.  When we know specifically what is causing the unwanted behavior we can put in place strategies to stop those specific overtrading behaviours. In this situation knowledge is power.

The Fundamental Reasons for Over Trading

In this book my goal is to help traders understand what is behind overtrading behaviours and more importantly to stop overtrading in its’ tracks.  That’s right, at the end of this book; I hope to cause you to have a paradigm shift in your thinking that will enable you to stop overtrading forever.  That’s a bold claim and of course I can offer you no guarantees but let me ask you a question?

If you knew a young teenager who was taking Crystal Meth, and you had any influence over that teenager at all, would you know beyond doubt that what they were doing would jeopardize any future happiness and success?  Even if the teenager argued that the high they got from Crystal Meth was the best high they had ever felt and that in itself was a good enough reason to continue, would you not do everything you could to explain to that teenager that the current pleasure they felt with the drug could not possibly outweigh the life they would be giving up?

Now if that’s the case, imagine that teenager turned around and said to you, this is the best high you will ever feel, why don’t you try some and handed you some Meth.  In that situation I would hope that you would turn down the drug, even though if you know anything about the effects of Crystal Meth on the brain, you would know that it stimulates the pleasure centres in the brain to a degree that is unmatched by any other drug.  You would quite consciously refuse the drug, turning down the instant pleasure in favour of the long-term benefits.

This is rather a long question, but I hope that as an adult reading this book your answer would be unequivocal, that you would tell the teenager that the short-term pleasure of the drug could not possibly outweigh the long term damage that will be done to their health and their life.

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So, what has this to do with overtrading you may ask? Well, when we take trades that are not in the system, we can become addicted to the chemical high we get which is the same high that addicted gamblers get when putting on a bet.  When we take trades outside our system, we may rationalize it with all sorts of logical reasons, but this is a trick our brains play on us to justify taking a trade and thereby getting a jolt of stimulation which can be similar to the high of taking a drug.

Electronic trading has huge advantages due to its’ accessibility however this is also its greatest drawback.  There is nothing between you and the mouse when it comes to putting on a trade except your will power and will power has severe limitations.  If you have become addicted to the thrill of taking a trade and all that is standing between you and taking a trade that is outside your strategy is your will power, then at some point the addiction will win.

What it comes down to is that we go for the short-term intensity of feeling over the long-term boring benefit of waiting for the correct setup. I am assuming that readers of this book have experience with the trading environment, if you are new to trading you may not understand how pervasive overtrading is throughout the trading world.  However, taking trades that are outside the system is probably one of the biggest reasons that traders who have a winning system fail.  They simply take trades when they should not and don’t take trades when they should.  In order to succeed in trading (and this may sound very simplistic) but traders need to take trades when they should and not