Trading is the only profession in the world where no Prior Qualification are required, Any one with money and a Trading account can come and trade in Stock market. To make money in Stock market we just need a Click on a Mouse Button to either buy or Sell. Probability of trade being a winner is “50%”. If trade is successful which happens to most of amateur trader Thanks too Beginners Luck Phenomenon you get overconfident and tend to take unwarranted risk which lead to busting of the trading account. As we all know almost 90% of traders tend to bust there trading account.
Based on my Years of Experience in Financial Market Below are the few QUALIFICATIONS which are MUST to become a Profitable trader.
- PATIENCE Patience is a virtue, especially in the stock market and most essential qualification required for a trader. You must have patience to wait for the right trade to come, and not be impulsive to get in soon or to exit it soon. Once a trade has been executed and it starts moving in your favor, you must have patience to hold it until you are near exit level as per your trading plan. Never close a trade just because you have a profit; do not become impatient and get out for no real reason. Every act, either in opening or closing a trade, must be based on your trading strategy. There is no use selling a stock because you fear it is going down, nor buying it because you hope it is going up. Look at your charts/trading strategy and see which way the trend points and follow it. If no definite trend is shown, use patience and wait.
- Mental Strength: Trading is a mentally stimulating professions. It requires a mental toughness unparalleled by any other business. To become a professional trader with the ability to survive in different market conditions, one must develop understanding and control over their personal psychological strengths and weaknesses. During my career I have seen many traders who had made one mistake after another and suffered severe losses, and still had some capital to work with but when an opportunity appeared, they lacked the nerve to act. In Trading we need to execute our trades without hesitation or double-mindedness and this requires Mental Strength. Cutting your losses can be extremely difficult to learn and letting your profits run can be ten times more difficult than learning how to cut your losses. These all tricks needs to be developed using Psychological and Performance Coaching
- KNOWLEDGE Experience is the only school to learn in and the burnt child is the one who knows the pain from having put his fingers in the fire. Mistakes are all right and hard to avoid. They are good for us, because if we profit by them, they prove valuable. But it is wrong to make the same mistake the second time. Therefore, use every mistake as a stepping stone to progress; analyze each mistake you make and the cause of every loss, in order to avoid repeating the same error in future. With each experience I had, good or bad, I accumulated knowledge, and after all, knowledge is the greatest power of all, for capital will always come to knowledge. Remember an Old Age Adage “You may be without cash, but If you Have Knowledge in the stock market is worth hundreds of thousands of dollars and in a short time You can turn that knowledge into cash.” Just as “castles made of sand, fall in the sea, eventually,” traders who ignore the fundamental ideas of1) trading a sound concept
2) having a trading plan
will soon find themselves adrift in the “Sea of Losers.” Don’t let that be you.