Some of the Immutable Laws of Trading

Today I posted a comment to help a fellow investor/trader on Marketwatch.com.
Here is an excerpt of my comment:

"One of the cardinal rules I use in trading is called Rule #1 from a book by a very successful trader (who, by the way, gives it away FREE):
"Rule #1: Assume it is a bad trade until proven correct! Positions established must be reduced and removed until or unless the market proves the position correct. (from Phantom's Gift -- see my blog site for more info on the book -- absolutely at no cost whatsoever.)
"This rule has saved me a lot of pain, and has ironically also made me a lot of money! Not only is maintaining a losing position bad for my pocketbook. It is bad for my emotional state and it gives control of my money to the market instead of me keeping control of it in my hands."

If you'd like to read my entire comment, including some other laws of trading, you can read it here:
Treasuries Rise Again

The essence of Rule #1 is that you only stay in a trade if it is a profitable trade within a reasonably short period of time. All other trades are exited quickly! You don't put on a trade and then sit around praying that it will make money, all the while waiting with white knuckles and baited breath. By doing this, I save not only my money, but my sanity! I also guarantee that I will have money to trade another day!

Phantom's Gift - one of the best trading books -- and it's FREE!

Here is a link to a document that I downloaded (it is free) from the Futures Magazine website:

http://phantomsgift.4shared.com/

This document is my Bible of trading. It doesn't teach technical analysis or trading methodology, but is more about the immutable laws of trading success and trading philosophy. It is written (it is done interview style) by Phantom, a veteran futures trader who has made great sums of money in the futures markets.

I believe that in every realm, there are laws that control success in that realm. Phantom's Gift teaches many of those laws. I will, from time to time, refer to the "Rules" taught by Phantom in his book, as well as other laws that I have learned.

I met Phantom years ago in a forum for Forex traders. He became what I considered to be a mentor, but I eventually lost track of him and haven't had any contact with him for about 3 years or so. I would very much like to renew acquaintance, if anyone knows him and can help me renew our friendship.

By the way: this shared folder is hosted by 4shared.com, a wonderful website for sharing files. You can open an account with them yourself by clicking on the link below my profile at the right side of this page.