ONLINE BUSINESS

One of the greatest business adventures a person can embark upon is that of becoming a successful, professional trader. We are all fully aware of the possibilities—make tons of cash, work from anywhere in the world, be your own boss. However, the challenges that new traders face are very real. So real, in fact, that industry legend says that most people fail in their journey to becoming trading masters. On closer examination it seems that those who fail tend to conduct themselves in certain behavioral manners, and those who succeed tend to likewise conduct themselves in certain behavioral manners. There seems to be a large discrepancy between these two manners of behavior.

Trade Planning

Successful traders plan their trades. Unsuccessful traders do not. New traders are often drawn into the trap of “trading from the hip,” which means reacting to price by executing lots of undisciplined trades for no reason other than, “I thought it was going up.” This lack of attention to detail and planning kills new traders. A successful trader possesses a deeply internalized understanding that his strategy is important, but it is not most important. His ability to execute that strategy flawlessly—that is invaluable. Most traders do not get this concept.

Trade Review

There is a large divergence of behavior between struggling and successful traders on this point. Successful traders review their trades in their forex account, especially the ones that do not work out. Struggling traders, on the other hand, do not. Struggling traders are generally still very attached to the emotional outcome of losing trades, and therefore want to disassociate themselves from a loss as soon as it happens. This is a bad idea! How does a trader learn how to further refine his trading approach? Not by examining winning trades.

A trader does not learn much from his winning trades, because a winning trade did exactly what he thought it was going to do—that’s why it won! Losing trades are different though. Something happened that the trader did not expect, which demands further examination. Perhaps the market is offering a clue of when not to take a trade. This information can be invaluable as it may help a trader weed out potential losing trades before he even takes them. The priceless information gained from analyzing losing trades is essential for trading success.

Money Management

I once spoke with a Commodity Trading Advisor who managed a fund with several hundred million dollars under management. We were speaking about trading and risk management, and he said, “When I’m at a social gathering and someone asks me what I do for a living, I tell them I am a portfolio manager, but that’s not what I really do. I don’t manage a portfolio. I manage risk. Risk management is what I do day in and day out.” This is how a professional trader views trading. Trading is managing risk. Those who manage risk appropriately tend to fair much better in financial markets than those who do not. New traders are often aware of the term money management, and perhaps they pay some attention to risk, but rarely will they have a systematic focus on risk management. Understanding risk and how to manage it is yet another key difference between struggling traders and those who are consistently profitable.

Trade Planning, Trade Review, and Money Management are simply 3 of the many basic areas of trading where vast behavioral disconnects exist between struggling traders and those who are truly consistently profitable. By attacking the three areas explained in this article, a new trader can help increase his chances of finding success on the extremely difficult, but immensely rewarding journey of becoming a trading master.

It was not too long ago that most people had no internet leave alone e-mail address. But internet brought in a new era that is full of unlimited information. Internet gave birth to electronic mail popularly known as e-mail. E-mail opened new avenues to the world of communication. In the beginning e-mail was only used as another means of communicating with other people for personal or business related matters. Now people of every age group have an e-mail address. But, since past few years its potential for marketing has been exploited to its maximum both in good and as well as bad manner. At the same time who can disregard the services of direct mail which has been operating since nearly two centuries? It is still the preferred method of communication for many people.

E-mail is the cheapest method of communicating available as of this date. The advantage with email is that you can send email to many people at the same time just with the click of a mouse where as in the case of direct mails one has to go through putting letters in envelopes for each and every person, make different address labels, mail it and also have to bear the cost of mailing. Time is money and e-mail marketing saves a lot of time.

While e-mail marketing might look easy but if you compare the net result the story is totally different. When you are marketing through e-mail you go to make sure that you are e-mailing the right person otherwise the e-mail would end up going to junk folder. Also you got to be careful that you don’t miss the subject or the body of the e-mail otherwise the net result would be same. In this age of spamming, spammers use variety of subjects, so you have to put the subject keeping in mind that it wouldn’t send your e-mail to the spam folder again. In contract the direct mail gets a better treatment. Studies show that direct mail is more efficient and has better success than e-mail. First, it is not as easy to block direct mail as junk e-mail and secondly the process of blocking mails itself is not automated like e-mail. The other reason why people hate e-mail marketing is due to constant bombarding of e-mails from spammers and illegal marketers from Nigerian money scams to porn to online prescription drugs to stock quotes to what not. In addition to that, you also get promotional offers from big companies and who can ignore phishing these days. Due to all these people have developed a negative perception about e-mail marketing and they simply delete or spam the e-mail if they do not identify it as their regular e-mail. In contrast direct mail is seen with respect and people pick their mail as a daily routine and open them with a priority. Read the rest of this entry »