As a trader, you don’t have to be super smart, many Doctor Engineer and Scientist who were best in their field have failed in trading miserably and few of my students who have not even graduated have done wonders :). Whats the difference
The Successful traders can control their emotions and are mentally very very strong. They know how to react and come out of Uncomfortable situations and do not blame others for their losses.
Although having a tested and sophisticated trading system is very important, the difference between an amateur and a professional trader lies somewhere differently.The reasons for unnecessary and avoidable losses of amateur traders can often be attributed to the following 5 points:
- Revenge trading: You open a new position just after your stop is triggered, without seeing valid re-entry signals.
- Playing catch up: You want to make up for past losses, force trades and violate your rules.
- Not Knowing Trading System completely:You flip through your charts without really knowing what you’re looking for and then take trades that don’t meet your criteria.
- Fighting the market:You want to avoid losses and, therefore, widen your stop loss order or take it off completely.
- Not trading as per System signals but on emotional approach:You miss a trading setup and then jump in too late, although you should have stayed out by then.
If you are honest to yourself, you will know that you have probably engaged in at least a few of these 5 negative trading patterns. There is nothing to be ashamed of because most traders commit to the same actions and repeat their mistakes over and over again. If you objectively look back on your trading performance, most traders will see that the reason why they are not making the money they could be making is not because of the absence of a good trading strategy, but their repeated engagement in impulsive, emotionally caused trading decisions. It is safe to assume that most traders had a much better performance – some losing traders might even be break-even or winning traders – if they just had avoided the 5 previously mentioned mistakes.
Trading is a performance game and it’s not the trader with the most sophisticated trading strategy that will come out ahead, but the one who can control his emotions and attitude most effectively.
No need to think too much just following Mr Bramesh Sir.u t great sir g
Very True Bramesh… It was need of the hr. in present market condition… It is said that after every 3 to 5 years, day trader community used to change.Old one are replaced by new ones….
An excellent write up that reveals the truth. We should avoid all those 5 mistakes and play patiently to earn in the stock market.