“The less you know, the more you believe.”
How prepared are you for a rainy day? In terms of your personal life, this can mean different things. However from a financial standpoint it means having a way to rebound and properly evaluating every investment before you jump in head first. We all have our bad days. Some days seem worse than others, where everything is going wrong no matter how desperately you try to prevent it. You can get past it, as long as you have taken the right precautions. By having a safety net in place, you will prevent a total break down even if everything else goes completely out the window.
Prepare yourself for a bad day. That does not mean avoid all trades and hold back. It means come to terms with the fact that we all experience a bad time now and again, whether you misread something and made a bad choice because of it or if you simply missed an opportunity. You are eventually going to experience a financial loss when trading. The sooner you realize this; the better off you will be when it happens. Along with ensuring that such a loss will not completely drain you financially, you must also make sure it doesn’t drain your motivation. Experience is the best teacher, especially when mastering the stock market.
John F. Carter, author of Mastering the Trade: Proven Techniques for Profiting from Intraday and Swing Trade Setups, outlines his approach to taking precautions. In his office, the author has set up a number of computers. One handles all email, online searching, and instant message activities. Carter knows that this specific machine is at a higher risk of being infected by viruses and dangerous spyware. To prevent these malicious attack tools form finding their way into his trading computers, this specific machine is kept separate from the network.
Another computer, specifically a laptop, is used as a backup machine. This one is connected to a dial up modem. If the power was to go out or the broadband internet connection fails, the laptop will still provide Carter with access to all accounts and quotes. Using this equipment and set up Carter has effectively erected a fail safe in case of almost any unexpected situation. It is highly unlikely for multiple computers to experience issues or both internet connections to fail, which lowers Carter’s risk on a day to day basis.
Although this sounds more technological, it is a perfect example of how to be careful and stay prepared. Being prepared is an extremely important quality that has a tremendous influence on your success. You do not have to find yourself in a hopeless position when things go wrong. Have a back up system in place and alternate options so you will be able to overcome almost any obstacle.