Trading Psychology: Key Concepts and Solutions

Introduction

• Speaker: Emanuel Malurovich, full-time equities trader
• Experience: 5 years of trading, mentored by father with a decade of experience
• Objective: Share 5 years of trading psychology experience and provide actionable steps to improve trading profits
• Transparency: Shares personal brokerage statements to prove trading success

Importance of Trading Psychology

• Makes up 70-80% of trading success
• It's crucial to control emotions rather than eliminating them

Common Trading Psychology Issues & Solutions

1. Greed

• Definition: Strong desire to make money
• Impact: Leads to issues like overtrading, overleveraging, revenge trading, impatience, and holding trades too long

Overtrading

• Cause: Taking too many low-quality setups due to greed
• Solution: Develop a detailed trading plan distinguishing high-quality from low-quality setups

Overleveraging/Overrisking

• Cause: Desire to catch big trades
• Solution: Have a strict risk management plan with defined maximum losses

Revenge Trading

• Cause: Trying to make back money lost
• Solution: Limit trades on a single stock, remove from watchlist after multiple losses

Impatience

• Cause: Eagerness to make money quickly
• Solution: Focus on the trade process, not just profits; develop patience

Holding Too Long

• Cause: Ignoring exit plans to seek more profit
• Solution: Follow exit plans, take partial profits

2. Fear

• Definition: Fear of losing money or not making profit

Fear of Being Wrong

• Cause: Ego and desire to be right
• Solution: Focus on making money, not just being correct

Fear of Losing

• Cause: Hesitation due to risk
• Solution: Lower risk to comfortable levels

Fear of Missing Out (FOMO)

• Cause: Breaking plan to avoid missing trades
• Solution: Recognize that many opportunities exist; avoid late entries

Fear of Not Being Good Enough

• Cause: Lack of confidence and frequent strategy changes
• Solution: Consider mentorship to learn proper trading techniques

Additional Strategies

Starting the Day in the Green

• Benefit: Sets positive mindset for the day

Creating a Trading Plan

• Importance: Essential for success, to be discussed in a future video

Lowering Risk in Doubt

• Advice: Always reduce risk when feeling uncertain

Focus on Break-even Before Profit

• Approach: Transition from beginner to break-even before aiming for profitability

Stepping Away to Manage Emotions

• Practice: Take breaks if emotions become overwhelming

Conclusion

• Core Message: Discipline is key to overcoming trading psychology challenges
• Actionable Steps: Follow personal trading rules and plans

Call to Action

• Subscription: Encourages viewers to subscribe for more content
• Engagement: Request to leave comments and likes to help the channel

These notes summarize key points from Emanuel Malurovich's trading psychology lecture, aimed at improving traders' emotional control and profits. By adhering to structured plans and focusing on both greed and fear, traders can enhance their decision-making and long-term success.