Top 25 Quotes From One Good Trade By Mike Bellafiore

Best Quotes From One Good Trade By Mike Bellafiore:

1. A great trader is an elite performer. Elite performers spend every day trying to improve. Every day we trade is an opportunity to learn from the market.

2. The biggest reward of this job is the challenge to become an elite performer. I seek every day to improve, and I’ve been at this awhile. I do my best to master the psychology of trading. Traders learn more about themselves in a year of trading than many learn in their entire adult lives. The challenge is so intense it cannot help but force one to become the very best inside of him or her. Embracing the life of an elite performer eventually spills over to every facet of life like friend, brother, and son.

3. Do not judge a trade based upon its results! A profitable trade may or may not have been a good trade, what I call One Good Trade. A loser may have been One Good Trade. If your fundamentals for a trade are sound, then that is One Good Trade. Consistently profitable traders obsess about making One Good Trade and not money. Your job is to make One Good Trade and then One Good Trade and then One Good Trade…I am not trying to make money as a trader. My focus is on ‘doing the right thing.’ All I can ask for is excellent risk/reward opportunities. And then I execute. Being good at my job requires an obsession to my trading fundamentals. Money is just the by-product of me executing fundamentally solid trades.

4. Contrary to popular belief, trading is a craft. Like an artisan who develops a craft over a lifetime, it requires a discipline to be exercised daily. Just to get started, it takes 10 hours of work every day for months and maybe years to become a consistently profitable trader (CPT). Becoming a CPT is like joining an exclusive country club: they do not let everyone in and you must follow all of the rules or else your membership will be terminated.

5. The results of others have no effect on your trading. Trading is about personal skill development, discipline, and controlling your emotions. If the person to your left has developed his trading skills and yours are not as developed, then naturally your results will be worse. If the person to your right is disciplined and you are not, then your results will be worse. If the trader behind you remains calm during most of the trading day, yet you are easily frustrated, then your trading results will be worse.
   

6. Often, new traders mistakenly believe that trading is about developing some brilliant new strategy or making bold predictions. At some point, I have to remind them that they are not yet a market guru. They are not Jim Rogers, or Warren Buffett, or John Paulson. Perhaps one day they will be stars like these guys…But for now they should come in with an open mind. My sense is that this falsehood is propagated by the new trader’s misinterpretation of what they learn to be important from the media…Every day, ‘experts’ go on CNBC or Bloomberg News and propagate grand theories, more often than not ‘talking their book.’ Some are legitimate; some got placed there by good publicists. Please do not mistake what they do with what most meat and potatoes intraday traders do. We do not make grandiose predictions on the direction of the US economy. We do not have billions we must invest like hedge fund and mutual fund managers. We are not long-term investors. Successful prop firms first and foremost emphasize skill development. Simply put, you do not have to develop a brilliant new trading strategy, as we teach you proven ones. So before you start calling yourself a market wizard, learn how to trade. When you gain experience, after you have developed good habits and skills, you will be able to create new plays that work for you. But not at the beginning. My advice to any new traders is to seek a mentor who will offer you trading skills that will allow you to adapt to any market. What works one month may not work the next. But with fully developed trading skills, you can make the necessary adjustments.
   

7. If you pretend to know what you are doing when you start, you will quickly just prove that you don’t. You need reps. Experience will be the cure. There is only one outcome for those who pretend they know what they are doing. And that result is not a long-term future on a trading desk, or even as an individual trader. Spend your first three years just mastering basic trading plays and pushing yourself every day to get better. Save the new strategies for after you have learned how to trade. Be unoriginal.
   

8. Your goal every day is to improve. Each day is a gift from the market to improve. Work hard. Each day is an opportunity to get better. Focus on the process.
   

9. Trading is not a 100-hr a week job. At least, it isn’t for me. It certainly shouldn’t be. Trading is as close to being a professional athlete as I can think of. You must be well rested. Your performance changes from day to day. Trading – like sports – is performance based. Traders who trade well, just like athletes who play well, are paid more than they deserve. A trader must recharge after the trading day. You must be fresh and alert for the next session. Save the 100-hr work weeks for the investment bankers, lawyers, and analysts (and partners of trading firms like me).
   

10. Let me offer a quick exercise to help with your trading. No matter what your skill level, go get your trading journal and place it next to your trading station. Draw a line down the middle of your trading journal. On the left, keep a list of the things that do not work for you. Trading setups that do not work. Premarket routines that are not effective. Trading rules that are not helpful. On the right side, keep track of what works for you. Do more of what is on the right-hand side and don’t do any of what is on the left-hand side.
    

11. You have one boss – the Market. The market will disrespect those who disrespect her. If you are unprepared, you will be punished. If you lack discipline, you will be reprimanded. The market eliminates those unworthy of participation. Some examples of being disrespectful as an intraday trader? If you are doubling down, then you are being disrespectful. To double down means to start a position, for it to trade against your stop-loss, and then double your position. If you fail to hit stocks that hit your predetermined exit price, then you are being disrespectful. If you are unprepared to trade, then you are being disrespectful. If you ignore the price action of a stock or the market because they are disharmonious with your predictions, then this is disrespectful. The result of such actions are heavy fines from Mother Market.
    

12. Some would rather be right than make money. These are the types who conveniently forget that the market can remain irrational longer than you can remain solvent…Predictions are fine. But the price action of the market or stock is most important for intraday traders like us. If you have what you believe is an irrefutable trading opinion and the price action does not confirm your bias, then do not make the trade. Predictions absent validation from the price action are not advisable if you wish to enjoy a long intraday trading career.
    

13. Active intraday traders deal with rejection more than longer time frame traders. We trade more, so we are wrong more. If a losing trade sets you off, then this can affect your trades going forward. And this is dangerous. We call this trading on ‘tilt.’ You are in a temporary emotional state where you are not thinking as clearly as you can. You are angry, or frustrated, or disappointed. And then you make decisions that you normally would not. And rips result. In short, you manifest trading data that does not reflect your ability.
    

14. You have a choice. You can spend the first six months of your trading career not learning anything because you don’t listen, or you can start the right way. After six months, you can possess the skills that you need to trade profitably in any market, from anywhere, and for the rest of your trading career. Or you can be frustrated, unskilled, and with a decidedly negative trading account. Do not be one of the thousands who needlessly loses excessive amounts of money when he begins and worse still, never develops career-making trading skills.
    

15. Some like the idea of simply being a trader. It seems cool to them…It’s as if it brings ultimate respectability in the eyes of their peers…Some would-be trainees envision the rich trader lifestyle that they will lead. And this dream can become a reality. But none of this will happen unless you are willing to pay the price. And some just are not willing to work hard. There is grunt work that needs to be done every single day. At the end of the day, your eyes are tired. Sometimes my eyes start twitching over the weekend from a week of staring at screens. My wrists constantly throb because of the excessive typing I do searching for the next great trade. I often have to stop trading and just rub my wrists to relieve the pain…Some just do not want to watch some more tape of their trading after the Close. This requires a serious commitment…There is so much to do before and after the Close. You will not do all of this work unless you love trading. You just won’t. The problem is that if you do not do all that the market requires, you will almost certainly fail.
    

16. While there is no one right way to make money trading, there is a right way to begin your trading career. When you first begin, you must focus on the process. You must allow 8-12 months to become consistently profitable. If you are not willing or are unable to do this, then you should find another occupation. Some are not able to commit this much time either financially (at best, you will be on a small draw) or psychologically to this pursuit. If this is the case, then again, please find another profession, because the market couldn’t care less about your finances or mindset…Becoming a consistently profitable trader just might be the hardest thing you will ever do in your life. Respect the process. You are not entitled to make it. You are entitled to work very hard for 8-12 months, be trained well, and find out how good you can be.
    

17. There are some traders who just cannot admit that they are wrong. They develop a bias about a stock. When the stock does not trade as they expected, they are paralyzed. They insist that the stock will start acting as they expected, and refuse to exit their positions. As I’ve explained earlier, successful intraday traders exit losing positions quickly. They are not emotionally invested with the market, proving their thesis correct about a stock. Consistently profitable traders are interested in making good trades. They accept that they cannot control the results. And holding a position that is trading against them because they are most interested in being proven correct is bad trading. At the best prop firms, a new trader is taught to just focus on making good trades.
    

18. In our game, the market will demand that you change. In our ring, the market will, with thunderous blows, often unforeseeably, knock you to the floor, leaving you bloody and beaten. And it will look down at you mercilessly daring for you to get back on your feet for another beat-down. And you will have a choice. You can quit, like many of my former colleagues have done over the years. Or you can find a way to hang in there. And if you live to play another day, enormous trading opportunities will come.
    

19. Trading is just a game of math and probabilities. We make fewer trades during the middle of the trading day because statistically our win rate is lowest. We do not trade with size when we first begin because our win rate will be poor. We focus on the process when a new trader starts because they are developing their playbook. Each trader must learn which trades offer the best win rate FOR THEM in THEIR style.
    

20. There is no shame in failing as a trader. The real shame is never trying if trading is your passion. If you are passionate about trading and you never give it a run, then you will live your life wondering what could have been. Having the nerve to take a chance and trade will serve you well later in life. Perhaps the next chance you take will work out. What you will learn about yourself is invaluable. What you soak up about the markets lasts forever. To try and fail because you were not good enough is honorable. It would be refreshing if this was the reason why all new traders failed. Unfortunately, as we have learned, that is rarely the case.
    

21. When we went to 1/16ths back in the day, I heard this was the end of intraday trading. When we transitioned to pennies, I heard that it was all over for the intraday trader. When Hybrid was introduced, this was supposed to be the final nail for us. When programs entered our markets, this was supposed to manifest our dissolution. Some traders were forced out during each of these changes. But good traders adapt. They find new patterns to exploit. HFT will not be our ruination. It is just another market challenge that we must learn to overcome.
    

22. If-then statements should be different for each individual trader. We all process information differently. Some are faster. Some have a greater tolerance for risk. Some are more experienced. Some trade a different time frame. But I have considered all the different ways my stock may trade before I enter. So if my stock acts a certain way, I am not surprised. I have considered everything the stock may do. I may find a move to be unusual. But again, I have considered this. And now I just react to the trade I am ready for…With well developed if-then statements your results will be more consistent.
    

23. We all slump. The problem is not slumping, but rather letting the slump last for an extended period of time. You must learn how to get out of the slump…I laugh thinking about how many slumps I have been through in my trading career. How many times I have wondered if this was the end for me. Sometimes, I actually go home, sit on my couch, and wonder if I am capable of continuing as a trader. And I would say I have done this at least twice a year for the past 12 years. This is a healthy process, as long as these thoughts are then replaced by solutions. This is healthy because I do not want to feel this way. My personal disgust with my trading and inability to accept failure fuels an internal need to improve immediately. It forces you to focus on what you do best as a trader and then execute. You either get better or go home. Just like a pro athlete.
    

24. Consistently profitable traders constantly evaluate their trading system. They make adjustments every month, every day, and even intraday. I have substantially changed my trading system six times since I began. I have traded through the Asian Financial Crisis, tech boom, Internet Boom, bursting of the Internet bubble, 9/11, a range-bound market, and now the near collapse of the banking system. Every day is new. There is no ‘system’ to learn. It is about developing trading skills and then making adjustments continually.
    

25. To last in this business you must reinvent yourself, tweak your profitable setups, and embrace the mindset of change. If you do this, your reward will be improved trading skills, and a larger bank ready to risk on the best of markets.
    

As a Beginner – Focus on Building Fundamental Trading Habits and Skills:

When people mention the term “fundamentals” in relation to trading, it often makes you think of fundamental analysis – like company revenues, P/E ratio, etc. But don’t get confused – fundamental trading skills and fundamental analysis are not the same thing.

One of the major themes that Mike Bellafiore makes clear within One Good Trade is that trading is a challenging endeavor that requires months (if not years) of solid training. It’s an extremely difficult craft. The market demands respect. And I agree with all of this.

Far too many people who enter the trading arena do so with improper expectations in regard to what it takes to achieve long-term, sustainable trading success. Instead of focusing on skill-building, they focus on gurus, alerts, chat rooms, newsletters, etc.

But these shortcuts don’t work. There’s no cheating the market. You might randomly make some money at the beginning without any skills or experience – but you’ll eventually give all that money back (and more) if the proper habits/skills aren’t acquired.

One of the trickiest parts about trading is that the result of an individual trade (a large profit for example) doesn’t mean the trade was a good one. Going all-in on a trade with a low probability of working out is a bad trade – so short-term results can be deceiving.

Making One Good Trade is about having the skills to spot and capitalize on excellent risk/reward opportunities over-and-over again. There will of course be losses along the way, but if controlled, the long-term probabilities work themselves out over time.

Learn More in the Trading Success Framework Course

Written by Matt Thomas (@MattThomasTP)

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