For many people, the most beneficial traits for success include focus, passion, commitment, and determination, just to name a few. While these traits are also beneficial for traders who trade the markets, they are not enough to see them through. Traders should know how to leverage their positions to boost returns and manage risk. Successful trading is technical and partly psychological, therefore, a great trader has to have a mix of winning character traits. They include:
1. Loss Cutting
All great traders throughout history were masters at cutting their losses. The first rule of thumb is that capital preservation keeps you in the game. However, the game also comes with many inevitable losses. If you understand that a -50% loss requires a +100% gain to get even, you will always find ways to bounce back from major losses and start again. The first rule of trading is not losing money. Traders should work around this rule. Remember, the sooner you accept defeat, the sooner you will move on.
If you want to be the best, you have to be consistent. Many traders fail because they put unnecessary focus on their day-to-day profit and loss. Rather, they should know the best trading times and capitalize on them. You should not be the kind of trader who has one big win and thereafter, starts giving back to the market. Understanding positive months, quarters or years will help you to make a big leap to success. This way, you will always be consistent.
3. Can Differentiate Hype and Reality
Great traders should be able to think for themselves and come to their own conclusions. While there may be many offers and advertisements about trading sites that will promise you thousands of dollars on your first trade, it is important to learn about the trading site and make your own judgment. As such, you will be able to determine whether it is a perfect fit for you or not. Great traders are realistic, they don’t believe the hype.
If you are merely a trading beginner, do not expect to make big profits right off the bat. You need the patience to learn the ropes and understand what the markets offer and how they work. A successful trader will be quick to take losses and slow to make profits. Do not be in a rush to take profits, develop consistent trading strategies and your profits will slowly accumulate. Traders should always be patient with the markets and only trade when they will get the most out of it.
Great traders are inquisitive. They know how to step back and go through each trade in order to develop new and unique trading strategies. If they encounter a loss, they ask what they could have done differently. No matter how many times they fail, their inquisitive nature allows them to learn from others and use the right techniques to acquire profits.
6. Ability to Learn New Things Quickly
Inquisitiveness goes hand in hand with the ability to learn new things quickly, and good traders always find something new to learn from financial markets. On many occasions, there has been a quantitative easing program or negative exchange rate that influenced the current financial market. Great traders have the ability to quickly learn things from past and present markets. This broadens their trading opportunities.
7. Practice Discipline
Great and successful traders alike are highly disciplined. They not only identify opportunities, but also do extensive research, come up with strategies and exit tactics. They never lose their focus and do all that they can to attain their goals. In order to practice discipline, you must devise an independent trading strategy that will be a perfect fit for you.
8. Simple and Clear Planning
A trader who plans is more likely to succeed in comparison to one who operates on instinct alone. If you have good planning skills, you will place random trades without any proper direction. Great traders develop a solid plan and stick to it. If you adapt this, you will be clear about what your goals are and devise ways to achieve them. You can always adjust the plan depending on how it works for you.
9. Maintains Records
Needless to say, maintaining all your trading records will help you avoid making costly decisions. Many successful traders keep diligent records of their trades. This essential habit provides them a wealth of information that helps them beat the odds and attain success.
10. Attention to Detail
Great traders pay great attention to detail. Before any trade is initiated, parameters such as expiry time, market price and trade amount among others are shown. A trader should be able to thoroughly check all parameters and ensure that no mistakes have been made. Being attentive will also prevent you from making the wrong entry. As a trader, you will be able to develop new strategies in relation to the given trading rules.
11. Always Learn from the Markets
Great traders evolve with evolving markets. You should always be a never-ending student of the market. If you’re into binary options, choosing a platform with an educational component certainly helps, such as Stern Options for instance. The moment you engage in learning new things, you will discover new trading opportunities that others will not realize.
12. Find Balance
All traders want to make money and be financially independent. Even if you make the biggest trades, you do not have to sacrifice your everyday life and be subjected to your trading screen at all times. Great traders know how to balance all aspects of their lives in order to ensure that their trade does not consume them and they can still integrate it with their daily lives.
For many successful traders, practice makes perfect. Trading consistently will help you hone your skills and make you the best. Adapting these traits will make you a professional at what you do. Don’t be nebulous; wait for clear trading opportunities, be consistent and always strive to learn something new. Needless to say, this is the recipe for trading success.