Business Insider Article - Steven Goldstein's Golden Trading Guidelines.


Business Insider today ran an interview with the AlphaMind Project's co-founder Steven Goldstein. The interview focused on an article Steven wrote a few years ago, and which became the subject of an AlphaMind Podcast episode earlier this year.

You can read the article at this link.

Alternatively, if you were unable to gain access to their site, here is a transcript of the article.

Steven Goldstein successfully played the market for 25 years before starting to coach traders who manage billions. Here are his 15 'golden' rules that helped him ensure investing success.

While most traders are busy vetting strategies, meticulously absorbing every up/downtick in the market, and manipulating new algorithms, Steven Goldstein, the managing director at Alpha R Cubed and co-host of "The AlphaMind Podcast," knew the key to success was to be found elsewhere: between his ears.

"I knew the battle was in the mind," he told Business Insider. "I was always looking for self-improvement."

But Goldstein — a 25-year trading veteran whose resume includes time at Credit Suisse and Commerzbank — didn't arrive at that epiphany overnight. He needed someone to help him put things in perspective.

"I was always looking for the answers outside of myself," he said. "Reading books, trying to change strategies, trying new techniques — self-improvement externally, I would say."

Fortunately, all that changed when the firm Goldstein was working for at the time invited him to join forces with a trading coach.

"Suddenly, he showed me who I was," he said. "He allowed me to see myself in a whole new way."

Now, the tables have turned.

Instead of swinging around hundreds of thousands in the market, Goldstein helps a wide array of traders and money managers refine their craft. His clients are diverse in background, ranging from newcomers all the way to hedge fund traders who oversee billions. Interestingly enough, the common issues that Goldstein helps alleviate aren't discriminate.

"They're playing the same game just with different sized chips on the board," he said. "The people that I work with who have been doing it for 2o years face the same issues — almost — as the people who are just a few years into it."

Without further ado, here are Goldstein's 15 "golden trading guidelines." He encourages all of his trainees to develop their own set of principles. All quotes below are attributed to Goldstein.

Personal: 1-4

1. "Fear and respect the market but never hate it: Hate clouds judgment and leads to bitterness and resentment."

2. "Know yourself: Know your strengths and weaknesses. Know your personal stress limits and comfort zone. Have aims and goals."

3. "Suppression of ego: Ego can turn winners to losers and leads to mistakes and judgment errors. Ego is not in itself a bad thing, it gives one desire, but it can also be a hindrance when too inflated or hurt."

4. "Stay fit, healthy and balanced: This applies internally to one's self: A healthy body will produce a healthy mind."

Planning: 5-9

5. "Understand the market, its drivers and its idiosyncrasies: It is vital to understand the market one is trading in. Each market has different characteristics, liquidity, volatility, event risk, and minor driving factors. "

6. "Preparation, preparation, preparation: Planning and preparation for trading cannot be overstressed enough. Too often money is lost on trading whims or poorly executed plans."


7. "Essential money management: This is a vital part of planning. - The downside must be protected, if trades are successful the upside will take care of itself, but inevitably drawdown will occur from time to time."

8. "Speculate, do not gamble"

9. "Patience is a virtue: This has many applications: Do not trade for the sake of it. Do not worry about missed opportunities, other opportunities always come along."

Trades: 10-15


10. "Markets are volatile and rarely follow the script to the letter: Price action in many markets can appear to be almost random, particularly at the micro level where they rarely conform to predicted market behaviour. However, at the macro level, when trending and at crucial infection points, the larger moves can be predicted with a degree of probability."

11. "Do not be afraid of losses but do control them: Losses are an essential part of trading, without losses there will be no profits. However, it is essential to control them."


12. "Do not feel you have to trade: It is not always easy to do, but sometimes it pays to sit on one's hands or reduce."

13. "Trade the market not your P&L: This speaks for itself: Whenever one moves from a trading view to protecting P&L, decisions are going to be dictated by fear of losses rather than a market view."

14. "Good execution is vital: Good/poor execution can be the difference between success/failure on a trade. Execution does not mean purely getting in or out of a position, it also means lightning up and increasing."

15. "There are no guarantees: Opportunities exist because of uncertainty. Price forecasts are at best estimates."