Day Trading Tip: Do Not Look at Your Trading Profit and Loss
Going Old School
Remember Red Green? For 15 TV seasons, The Red Green Show and the folks at the Possum Lodge entertained us with one do it yourself project after another that involved the use of duct tape.
Today I want to go even more old school. Not with duct tape but with … are you ready? Masking tape! Yes, masking tape. It’s been over 90 years since its invention and it plays a key role in the life of successful day traders.
As a beginner day trader, you will hopefully have practiced for quite some time in a simulator, trading in real time with the same amount of money you intend to use when you go live. And then the big day will come. The day you have been practicing and training for. You will be ready to go live. You will have an account opened with your hard-earned money sitting in it, ready for action. Before that exciting day arrives, go buy a roll of dark masking tape.
Why? Your P&L, your profit and loss, is not important when you first begin trading with real money. On many trading platforms, there is an option to hide your real time P&L. If yours does not have it, then go old school and use some dark masking tape. I say this very seriously. I encourage you to slap some masking tape on your screen.
As a new trader, you will be tempted to constantly look at your P&L. It’s the most emotionally distracting column in my trading platform. Plus $250, negative $475, plus $1,100. I tend to make irrational decisions by looking at it. Do yourself a favor and hide it. Trade based on technical levels and the plan you make. Don’t look at how much you are up or down in real time.
Successful traders are those who trade for skill and not for the money. Almost all professional traders hide their unrealized Profit and Loss column while in a trade. They have no interest in seeing how much they are up or down.
Many think a good trading day is a positive day. Wrong. A good trading day is a day that you were disciplined and traded sound strategies. The normal uncertainty of the market will result in some of your days being negative, but that does not mean that a negative day was a bad trading day.