The Trading Mindwheel

Foreword xiii

Introduction xv

Prelude xv

The Start of Something Life Changing xv

Philosophy of the Trading Mindwheel xxii

The Axle Mindset: Beliefs, Belief Systems, Emotions, and Habits 1

Jesse Livermoreâs Story 2

Mindset Is Everything 3

Taking Inventory of Our Beliefs 3

2 A.M. Wakeup Call 4

Deconstructing Beliefs and Belief Systems 6

Write Your Beliefs 9

Emotions and Emotionality 14

The Marathon 15

Healing Wounds 16

When White Knuckling Fails 18

Meditation Is a Marvelous Tool! 21

Seek Clarity 22

Equanimity 33

Spoke 1 Journaling: Step One of Accountability and Continuous Improvement 35

What to Journal About 37

Types of Journals 44

Trading Routines 46

Spoke 2 Analysis: Analyzing Trades and Markets 55

Three Things I Learned the Hard Way about Trading 56

Analyzing Trades and Analyzing Markets 69

Influences and Studies 72

Fundamental Analysis: Defining Our Universe 74

Defining Our Setups 86

Developing a Funnel 96

Analyzing Markets 96

Spoke 3 Risk: Initial Capital Risk, Position Sizing, Potential Reward 107

Risks Involved in Risk 109

Mindsets Needed for Risking Capital 115

Ways to Effectively Manage Risk 122

Spoke 4 Trade Management: Managing Risk throughout the Life of the Trade 137

Life Cycle of a Trade 139

Beginning of the Trade 140

Four Types of Exits 143

When to Sell in Stages vs. When to Sell It All 154

When to Add 159

Dealing with Earnings Announcements 163

Spoke 5 Portfolio Management: The BIG Picture and Assessing Our Total Risk 165

Assessing âPortfolio Heatâ 166

Paulâs Story 168

Setting Up Circuit Breakers 170

Spoke 6 Post Analysis: Step Two of Continuous Improvement 173

What to Include in Post Analysis? How Long and How Often? 174

Getting Organized 176

Three Habits That Will Help You Improve 179

Discipline + Balance = Sustainable Success 182

Spoke 7 Testing: Factor Modeling, Back Testing, and Forward Testing 187

Factor Modeling 188

Back Testing 192

Forward Testing 193

Conclusion 197

Acknowledgments and Inspirations 199

About the Author 201

Index 203