| We often hear the alarming statistics regarding the failure
rate of traders. Stop me if you haven't heard this one… '90 percent of all traders go broke.' Has a familiar ring, doesn't it? The reality is, trading doesn't necessarily have a track
record any worse than any other worthwhile profession. How
many people start playing basketball with the dream of
becoming a pro and actually make it to the NBA? I'll bet
it's much less than 5%. How about Doctors? Lawyers? Pilots? Engineers?
Accountants? I could go on all day. Like all professionals, traders have to dedicate a lot of
effort to achieve a high level of success. Unsatisfactory trading results are usually the end product of someone with
little or no experience throwing their money onto the
market and expecting the profits to be easy pickings. Although all traders are different, successful traders
share many common traits. Novice traders need to invest in
themselves to become profitable, and concentrate on
developing, at least, these 5 characteristics: 1) Education
To be successful, a trader must completely understand their
market. Like any business, trading for profit requires one
to constantly be learning. Make it your goal to learn
everything possible about your playing field. The people that comprise the trading markets are constantly
evolving and winning traders know they need to adapt to the
ever changing landscape. Take the time to invest in your
professional growth and it will pay rewards in the long
term. 2) Patience
A successful trader can sit on the sidelines for days
waiting for the proper setup. They don't jump into a trade
just for the sake of trading. Yes there may be
opportunities, but the smart trader waits for the best
ones. Often the best trade is no trade. Over trading by rookie traders is a big obstacle to
overcome. A need to always be in the market will lead to
taking trades that are likely too risky. Learn patience,
it's a key to success. A winning trader usually has an extraordinary amount of
self control. Whether reaping rewards or taking a loss,
successful traders will have an even emotional state. 3) Trading System
Top traders have developed a system to guide their trading
decisions. They have established rules and once certain
conditions are satisfied, they act to open, extend, reduce
or close their positions. There is no perfect system that will guarantee only winning
trades, but a good system will tell you when it's time to
cut your losses. A system needs to suit the trader. Factors such as the
amount of time a trader chooses to devote to trading, or
the level of risk an individual is comfortable with should
be major considerations when building a system that fits. A system must be built to suit a trader's personality and
this is the single biggest reason off-the-shelf systems
seldom work for their buyers. 4) Discipline
Trading is not a black and white game. There are no sure
bets. It is about calculating the odds of success and
determining how much to risk on each play.Having the confidence in yourself and your system to make
the move to book your profit or take a loss when your
method tells you to is a winning trait. You have established the rules to protect and grow your
money. Success will come with discipline. 5) Long Term Perspective
The current trade is only a small part of a much larger
long term picture. Win or lose, you will move on to the
next trading situation. Every trader must develop the
ability to keep on going. You can have many failing trades and still be profitable in
the long run. Short-sightedness causes rookies to over
trade, often trying to make back lost capital from an
earlier unprofitable trade. Losses are part of trading. Successful traders are
independent thinkers and have achieved a healthy level of
self confidence. They don't take losses personally… it's
part of the game.
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