The Secrets of the Successful Trader…
The trading game is as much played psychologically as it is physically executing trades. After the markets are closed is where average traders turn into successful traders. To be a successful trader it takes a specific skill set, but more importantly the proper mindset. The techniques, strategies, and lingo can be readily learned, it’s the other side, the psychological aspect which turns an average trader into a successful trader.
Create a Business Plan – “Plan Your Trade, Trade Your Plan”
Treating trading as a business with the objectives, goals, and guidelines clearly laid out will not only help keep things organized, but allow for less emotional involvement during tough market conditions. Defined entry and exits need in place for when to take losses and profits. Protecting profits while limiting losses is the name of the game, remember the bottom line, we’re in this to make money.
Being diligent and thorough with your trading keeping detailed records will be a tremendous help and allow you to go back and really pick apart things the things that are working from the things that aren’t.
Finally decisive action is an important quality to have when developing as a trader. A good trader has trained his eye to spot potential forming trends. Often times when a clear trend is established it is already too late to enter in the trade. The business is trading and treating it as such will be the first step to becoming successful.
Patience, the word traders live and die by.
Doesn’t over trade
Balancing trading with personal, family, and time with friends
Only blame themselves for bad mistakes
The only person who can be blamed for your trading actions and mistakes is YOU. Whether you heard the stock tip from a friend or on TV, it is you that pulled the trigger and only you who can take credit for the losses and conversely profits, you make.
Apply Money Management Skills Exclusively
Isn’t afraid of taking losses, but keeps them small (or win loss ratio etc. under control)
Knows there will always be another trade
Lets their winners run (takes bigger chunks out of the markets)
Having an arsenal of strategies is great, but knowing when and what type of market environment to use them is the key to having a successful trading career.
Never Stop Learning
Becoming a successful trader takes time, years and years of studying the markets day in and day out. Making mistakes, losing money, and learning from your mistakes. By reading and learning from the mistakes of others, we are able to ease some of those losses.
Understand that there is no Holy Grail
While many black box systems exist, they only work for a short period of time before failing or breaking down.
The simplest form of trading is price and volume and successful traders always come back to reading price and volume.
Must Have an Strong Desire to Succeed
This doesn’t mean extremely risky, it simply means open to recognizing and seizing opportunities. Passionate and resilient – People will say you can’t do it, and the markets may get you down, but if you are driven you will succeed.