Professional Trading Techniques – I

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I’m sharing these points which are very useful to understand the trading. You’ll understand as a professional trader what you should know about trading and you can continue your trading journey as a professional trader.

Most people know atleast one or the other reason why most traders fail. The reasons are simple but it is not only one reason. Let me put the list here.

Most traders think that trading is easy way of making money so they rush into the market to get rich quickly.

They think they will get rich in just few days so start taking more risk and end up loosing.

To master any sports, games or profession, you need regular practice, but most do trading in hurry without realizing that they are risking their hard earned money.

Most traders forgot that they studied 20 yrs to get their first job of say 10k or 20k or 30k per month and come to trade as a gambler without having knowledge and passion to learn. Remember that like other businesses, trading is also a business which requires proper studies, planning and execution without which any business tends to fail. Behaving professionally & taking trading as business is very very important.

Most retail traders lack emotional control and discipline. They ignore sound trading rules and rush into the market to get rich, thinking it is easy if they only find that perfect strategy.

Most retail traders trade too often. More they trade more they loose. They do not put their brains that if they make less trades with higher profit probabilities they will end up more rather than making too many small trades and risking large part of their capital.

Most traders are not self reliant. They react to the market instead of anticipating the market. Brokers, clearing houses, the news media, the exchanges, etc all benefit from retail traders activity. They don’t know that the more trades they do, the more profits their broker, clearing house, news media, and others make. They want you to trade as often as possible and they don’t care if you make money or lose money so long as you trade, trade, trade. Most traders have false belief that trading more often will result in more profits. It is a falsehood promoted by those who make money from your trading.

 Most traders do not know their self worth. They risk more than they can tolerate and thus end up loosing out of fear and greed.

Most traders only trade for money instead out of passion, motivation and self esteem. Trading for fulfilling their greed end up making them loss.If you do not love what you are doing but just doing it for making money, its disastrous.

They keep the profits small and losses big. They do not plan their trades and so they panic when their trades turn against them.

Some make good profits at the start and start thinking that they are invinicible & masters of trading and out of this euphoria they start making trades in gambling mode

Practice, experience, and skill will create self-confidence. You can’t over-practice trading. Behave professionally and treat your trading as a business. Develop your own unique trading style and don’t follow the crowd. Be self-reliant and develop self-confidence before trading live in the market. Know your financial self-worth and risk tolerance and strive to continually improve both of these areas. Practice to control your emotions while trading. Realize that trading is a process and that you will always be in a professional learning mode. Have a passion for what you do but don’t allow passion to rule your trading decisions.

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