Foreign. So obviously you're an expert technician and you've taught this to top institutions, to billionaires, to some of the best individual traders in the world. you run in that Circle What happens in with you personally, but also that group of exactly that. the discipline aspect of trading.

I've said this in previous interviews but it's one of my favorite things of it. Seems like a lot of trading is 70 discipline, 20 skill and 10 luck. So that discipline thing obviously, now that you've done this for decades, what is there something you do? Is there a trick of the trade to keep yourself to keep the Train on the tracks In terms of discipline when you have your entry rules ABC your exit rules XYZ we all get that little fear or that greed. Do you have a piece of advice for that? Because I Feel like honestly, after you learn some of the rules of trading, the hardest part truly is discipline.

Yeah, well actually um, there are quite a few things you can do and you can. The the good thing is yes it can be taught and it can be uh achieved. and it's I Think it's relatively easy. Well the first thing you will have to have in order to have Uh discipline is to eliminate doubts because if you stop second guessing yourself then you will be more disciplined in order to start.

second guessing yourself is to must have a trading plan if you're constant. If you if you're not driven, if you're not Uh rules based. if you're not model driven then you will start hesitating and getting in and out with every news item that is available in the market. So the first thing is to have a plan that that sets up the the base if you will for for discipline Because you say all right let's give you a very simple example.

If the market is above the say the 200-day moving average and the Macdv is below threshold level are working that in and of itself gives you the background of discipline because you won't be saying um should I enter here or should I enter that you won't go from forecasting you go to if then analysis. If this happens then I will enter Now once you have that then there are um. The second thing you can do is have small position sizing. If you don't have a lot of money in stake in the market that will decrease immediately your emotional association with the with this particular trade.

Imagine Okay let me let me give you a very hypothetical example if you had a trade, the exact same trade and on one side you were risking um one dollar I mean whether you're risking one million dollars and I ask you to manage the exact same position which one would you be more prone to be less disciplined with I mean the the million dollar one. My emotions would be all over the map because like the slightest move would either make me euphoric or depressed. So the second thing is first of all, you have a rule set. The second is to try to decrease the emotion, your emotional and wrong with your position.

So have a small position size And the third thing one can do to have more discipline is what I call RBT rep Repetition based discipline RBD Which means if you do it over and over and over again, then after a little while you won't think of it too much. Now of course the way to do it to to practice is on a demo account and I know most people frown upon it and say okay I mean it's not the real thing and um my reply to that would be you get eighty percent of the experience with zero percent of the risk. So the more people practice um using a trading plan and small position plan a small position sizing after a little while you don't you desensitivize, decentivize your uh your reaction to the markets to give it with a via. Another example, imagine watching a thriller and you know the leading person comes in with a knife.

stop someone obviously the first person. The first time you see you get scared. Now imagine if you see the same thing 30 times more. After a little while you know what happens so it doesn't really scare you.

So I think that's great following these three three three three steps. Um, people can gradually build uh discipline I Would implore anyone listening to this for a more in-depth conversation or probably look up things such as Kelly Criterion And that's just like betting of how much you should risk shouldn't risk. And that's what Alex is referring to here with the R value. On that note, for your account, what is your unit of risk? Is it One percent, Two, five, Twenty Five fifty.

What is do you find is mathematically appropriate to risk per trade? That's a good question. Well, I Think Um. position sizing is A. You can see it from two points.

One is the purely mathematical points. uh, the second is the emotional point. So I try to approach it from the emotional point of view in the sense that are you trying to maximize risk because you have different position sizing algorithms for that? or are you trying to sorry maximize your returns or Trying to minimize your risk. As far as I'm concerned, I'm always trying to minimize my risk.

So from a mathematical point of view, I may not be taking the optimal position sizing. but that's the right answer. The perfect answer for me. but for someone else, there may be different perfect answer because they may be actually trying to maximize the reward.

Um, so the mathematics of position sizing like Um, which of course, the definitive book and work of that is by uh by Ralph Vince Great guy, Really, really great guy. Um, we lead you to different Uh numbers depending on your profile. Is it not? maybe for you individually, but maybe from what you've seen in the industry, a lot of what I've consumed is basically saying never risk more than two percent of your portfolio. Do you find that to be somewhat true in that realm And I'm not saying exactly like is that how let's call it like the big players actually think of things or are they going even smaller? even bigger.

What do you think like the normal is um again, I think it would depend on the on the risk preferences. Well in my answer would be different, uh, depending on the person asking me. So if someone, um, who is completely new to this and wanted to learn I would say that's probably a bit too much. but if someone who is a professional and there are different ways to hedge your risk, for example, taking a a large uh Equity position, you can always use options to hedge it.

I mean so two percent might be you can, You can minimize that risk even if you have the larger position than two percent. Uh, so, but if we assume that the question is asked by a retail Trader who's just trying to get some skin in the game, you know, just you know. um, trying to learn I would say probably stick to one percent because even even for a retail investor, depending where they are on The Learning Journey or the learning path um probably position sizing would be different. So it's better to start on the conservative side and start increasing it because um when you start to learn your position sizing should be very small because you don't want to get discouraged.

What you actually want to do is get the reputation and try to do it as safely because you doesn't your it doesn't affect your confidence so have position sizing in a very safe environment as you start building some kind of consistency. Then you can flirt towards higher risk numbers which again it you your risk tolerance has to be it's a it's a matter of it's a function of your character and also your age. For myself I'm um almost 50 years old now so I I have some years to risk Capital but if I was like probably in my 60s or 70s, that would make it would be make sense for me to be risking too much on its particular trade and just to get ahead of any confusion. I Just want the listeners to know that when we're talking about that risk value, it's commonly relative to your account, not the trade.

It's not like if you buy a stock and it goes down one percent. It's not like we're necessarily campaigning, it might be appropriate to get up, but that's not where companies we're talking about the whole account.