Three Tools to Improve Our Trading Performance
If we internalize everything that we do such that all that we do acts as training, then it makes sense for us to train as intelligently and purposefully as possible. Here are three tools for training traders that have the potential to shape our future performance. (Please note that I have not received any incentives or compensation for mentioning these. The companies have no clue I'm writing this, which is how I like to keep it).
I've long advocated the use of simulated trading as a way of practicing pattern recognition for active traders. What makes TradingSim unusual is that it is entirely web-based (no software to download) and the data are included in the subscription. You can simulate trading any day over the past two years and the simulator will replay that day with any symbols and technical indicators you choose. You can view multiple charts simultaneously, and you can speed up the replay or advance bar by bar. You place your trades on screen and the program tracks your P/L and historical performance. Great way to review the day; great way to practice trading for developing traders--or for experienced traders testing new strategies. One unusual feature for daytraders is that the biggest moving stocks are displayed, so that you can trade what is moving. Longer time frame traders can use the simulation to aid their entry and exit execution.
What we're seeing is the next generation of tools to build successful traders. It's one thing to write in a journal and talk with a mentor/coach about trading mindfully or sticking to your best trading rules. It's another thing to actually work each day on mindfulness and actively practice trading with those rules. Taken together, these kinds of tools form a kind of performance gym. Talking to your basketball or football coach doesn't substitute for getting in the gym and engaging in the drills that lead to better conditioning and sharper skills. Similarly, speaking with a mentor or trading coach can't substitute for hands-on skills building. These are great ways to build trading-relevant skills without putting your capital at risk.