When it comes to investing, keeping your cool is essential. However, the large sums of money circulating the stock market are enough to let your emotions take the better of any person, even an investor. No kind of human behaviour is unknown to a trader, emotions like greed or fear and even group behaviour and peer pressure. Therefore, it is important to be able to look at investing as a job that needs attention to become a success.

Psychology

‘The first rule of investing is not to lose money. The second rule is not to forget the first rule’- Warren Buffett.

The purpose of investing with the help of Perfect Indicator is to try and make a profit, plain and simple, and in addition to lose as little money as possible, which refers to the first part of Buffet’s quote. The second part of Buffet’s quote refers to the fact that, when confronted with emotion, investors seem to forget this rule. Emotion like fear or greed can cloud any investors’ judgement, and as a result, they forget everything they have learned about loss limitations and the usage or stop losses because they think that this time ‘things are going to be different’. Sadly, they rarely are.

Greed & Fear
The most common emotions when it comes to making decisions in trading are greed and fear. The third emotion, regret, usually only rears when investors find out that they have made the wrong choices. Greed may sound as a very negative emotion, but this certainly is not always the case. In the famous Hollywood movie ‘Wallstreet’ Gorden Gekko, played by Michael Douglas utters the famous words ‘Greed is good, greed works!’ Of course, the backdrop to which these words are spoken is not that favourable, in the end Gekko ends up in prison, but the essence of greed is what causes investors to trade and obtain good results in the first place. When greed begins to take over an investors common sense and becomes the main target is when it all turns sour. Therefore, as with everything, too much greed is never a good thing, even when trading on the stock market.

Another emotion that can have a negative effect on traders is fear. Fear in itself is a very healthy and useful emotion. It warns you when things are not right, or when we are at risk of losing control. However, too much fear can lead to indecisive and uncertain behaviour; both disastrous for investors and can have a paralysing effect.

The same thing applies to regret. Endless grieving a wrong decision can have disastrous effect in the end, leaving an investor feeling uncertain and inadequate. Other dangers are being overly confident, and overrating ones talent and luck. Both make investing even more risky then usual.

Group behaviour and peer pressure
Humans are social creatures and therefore prone to group behaviour and peer pressure. In addition, investors are humans too en therefore no exception. As soon as certain organisations or large funds start buying certain shares, the other investors are soon to follow suit. When large investment banks like Goldman Sachs or Merrill Lynch publish buying advice in a certain direction, only the brave or stupid dare to contradict.
However, following the majority, and often the trend, is not always a bad thing, remember the saying, ‘the trend is our friend’. It is, however, important to try to recognise the signals that the trend is turning in the right time.

This is where we at Perfect Indicator come in. To quote a famous saying ‘when the bulls change into bears’, is when things may turn for the worst fast, and we can anticipate the sign timely and correctly by going short on the market. This way you can benefit from an upward going as well as a downward going market. It does not really matter which way the market is going, as long as it is moving.

‘There are times to go long, there are times to go short, there are times to go fishing’ – Jesse Livermore.

Successful trading can be found in the ability to wait. In this case, until we at Perfect Indicator give you the right signals to enter the market. In addition, like us, you should not be afraid to stop trading on a certain market for a while, when there is no way of establishing in which direction that particular market is moving. As long as you have enough liquid assets, there is no need to take unnecessary risks.

Perfect Indicator provides you with a clear trading plan that can only be accomplished by showing discipline, discipline and even more discipline. Make sure that placing orders, with you broker and trading because second nature to you, and be prepared when accidents happen like a computer crash. Always have the telephone number of your broker on hand.

Successful traders treat trading as a serious profession, a second job even, a job at which you have to pay attention and perform every single day. To treat trading as a profession means that we, at Perfect Indicator, spend sufficient time everyday, to become a better trader. Many traders, new to the business, think that trading is all about fast and easy money. However, practice shows that trading is a real job especially when you want to be successful. Successful traders who have been following the methods of Perfect Indicator over a longer period have come to realise this and take our share, as well as their own share very serious.

Our output and your output
Now we have shown you the difficulties faced by a successful trader and the abilities necessary to become a successful trader. However, the psychology of a trader is difficult to describe. It is the good results and experiences that traders experience with Perfect Indicator over a longer period of time that prevents them from taking large risks. Because we feel every one has to be able to get acquainted with Perfect Indicator and our services, we will not stop offering a free trial period without obligations. So you can test drive our services and find out, via a game-account for example (www.oanda.com or www.etoro.com) whether you can find and maintain the discipline needed when trading with our indicators and finding the right time and choosing the right trades.

Note that there is a possibility that we will ask a small service charge for maintaining the website, informing you of trades or other services in the future.

Attention
Please take note that we do not give trading advice, as a free subscriber you will receive buy- and sell-signals of our trading system. For specific advice related to futures, options, or other market information or to take an individual position on trades in the market, please always contact your own broker or bank. Remember that past performances are no guarantee for the future