Traits Possessed by the Top Traders
Not Going it alone
In any endeavor like sports, medicine, business etc., the most successful people did not do it all by themselves. This is particularly true in trading. There is a temptation to do it because of the intellectual appeal of trading. Traders are smarter than average and the notion of being able to just come up with a system that gives you the edge to pick more winners than losers is a notion that is very compelling to an intelligent person. This is where the majority of traders meet their downfall. Many, many people have tried to find the “Holy Grail” in trading only to find it does not exist and leave empty handed. Trading is a profession and like all other high paying professions, it is those that chose to become professionals that wind up being the winners. This is because in any competitive endeavor, any shortcuts to be found have already been found by the professionals and used by them to their advantage. Those that did not put in the effort to become a true professional or those who simply look for a shortcut are the ones that the pros love to compete against. It is difficult to become a professional all by yourself as the “trial and error” route is too long and expensive usually. Money can be lost very quickly in trading and most are not well capitalized to survive the learning curve. The top 10% of traders have learned that getting help is the fastest way to get consistently profitable and capitalize on the opportunity that trading presents. They keep that help even when they have reached the professional level in their field. It is very much like athletes having coaches till the end of their professional career. Same applies in trading too.
Trading as a Business
Any activity engaged on a regular basis for profit is a business. Trading is no different in this regard. 90% of all new businesses like trading fail because of factors such as a lack of a business plan, no prior experience starting or running a profitable business, lack of capital, lack of financial knowledge, lack of general business skills and more. In other words these people never treated their business like one. They were just thinking of making money and not planning anything else. So why is trading not viewed as a business? In any other business you need to do a lot of work before you get started as there are customers to deal with and products to sell. In trading you fund an account and get started. Trading looks very simple on the surface as you only to press the buy or sell button, nothing else as in other businesses such as a lot of planning. In trading all you have to do is fill out an application form and you are good to go. In other businesses you need licenses, you need a Tax ID, you need to deal with corporation papers, permits and so on. From a business perspective traders have a lot of advantages over traditional businesses. They are not dependent on suppliers or employees. They are not under pressure to turn a profit right away like a brick and mortar business which has a lot of costs involved in running it. Traders can test their ideas on paper first without risking real money which is not possible in other businesses. In trading you are in complete control. Regular businesses need to depend on their employees and customers to succeed. Traders can take a break at any time they feel like they need one. It is not possible to shut down a regular business from time to time. Professional Traders recognize trading as a business and treat it like one. They know trading has unique advantages over other businesses and capitalize on it. They approach it as a business and not something to do just to try to make money.
Remaining Detached
Many of the emotions that come into play and work against you in trading are due to the emotional attachments that you develop. This is true of individual trades and trading as a whole. Money is a very personal matter as it is how you pay for things in life you need and want. You have invested a great deal of your life to earn money for yourself. You probably have sacrificed much of you life to make money by getting up very early each morning, giving up on other dreams and not spending time with your family as you would have liked to. Being a trader means trying to live that dream and taking a lot of risk and not working for the rest of your life for someone else. It is very easy to get attached to a trade. You put in effort to find a trade and put it on expecting it to be a big winner and feel you need to hang in there to prove yourself right. This type of attachment to your trade is dangerous as you feel the outcome of each trade will validate the way you feel. If the trade wins you win and if it loses you lose. These situations are often catastrophic. The Professional Traders understand that each trade is the same whether it is a winner or loser. They know they did their best and they cannot have the market prove them right all the time. They know they have no control over the market and cannot outsmart it all the time either. It is important to remember that you were what you were before you began trading. You should remain yourself outside of trading and always bear in mind that you are separate from your trading. The Professional Traders are always emotionally and physically detached from their trading. They take breaks from time to time to keep detached from trading. They know that emotional trading is bad trading. they do this to stay on top of their game at all times. They know the market will always be there when they return.
