disciplined trading - how to trade your way to financial freedom - van k. tharp

Traders Library
Trade Secrets On-Line Manual
Disciplined Trading

How to Trade Your Way to Financial Freedom
with
Van K. Tharp, Ph.D.


Why It's So Difficult for Most People To Make Money.

z
We have a limited capacity for processing information despite the fact, that the amount of
information to which we're exposed doubles every year.

z
To cope with this limited capacity we’ve develo
p
ed a number of
j
ud
g
mental and decision makin
g
shortcuts. These shortcuts
g
enerall
y
hel
p
us, but the

y
also
p
roduce some serious
p
roblems when

applied to the world of investing and trading.

z
Our emotions provide a background context in which all trading takes place. Emotions very
seldom improve, trading performance, but they frequently take away from it.

Key Elements of a Successful Trading Model

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Discipline Factors

z
Respond-ability

z Beliefs

z
Low self-esteem.

“I would feel much better about myself, if I were more secure financially."

z
Feelings getting in the way of trading or investing. Fear and anger are not useful to
trading success.

z
Conflicts between internal parts of ourselves. For example, conflict might occur
between your excitement part and the part that wants to make money.

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Self Image Inventory

Determine your own level of self-esteem by answering each of the ten questions below using the
following scale:

0 - It doesn't apply to me

1 - It seldom applies to me

2 - It sometimes applies to me

3 - It mostly applies to me

4 It definitely applies to me


_______ 1. I tend to take losses personally.

_______ 2. When people give me gifts I tend to feel uncomfortable or feel I need to give something
to them in return.

_______ 3. I tend to blame others for what happens to me or for my problems.

_______ 4. I don't really enjoy being alone with myself.

_______ 5. I have trouble being open with other people and I tend to hold back.

_______ 6. I often need to defend what I say or what I do.

_______ 7. I feet put down when I'm criticized.

_______ 8. I tend to have some shame, guilt and blame.

_______ 9. I get jealous about the good fortune and success of other people.

_______ 10. I need approval, attention and praise from other people to really feel good about myself.
_
______ Total

Respond-ability

List your four greatest problems

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Trading Problems






Life Problems








Belief Heirarchy

B
eliefs are filters which help creat your reality.

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The Hierarchy of Beliefs

A change at the deepest level would change the entire system, because
anything at a more superficial level that was not supported by the change
would not be stable.


The Wizard Technique for Changing Your Behavior


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Understanding the Importance of Mental Rehearsal




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