There is nothing simple or painless about trading for a living. You have to compete in a rivalrous arena, defeat other gladiators, and not get yourself killed in the process. Here are a few ways to become a better trader and overcome your opponents.
Face reality- Spend time analyzing what you do and do not have control over. Only then can you focus on the things you can personally affect.
- You control your parameters for entries, exits, and position sizing, but you can’t control where the market moves, or the path it takes getting to your targeted price level.
- You can’t control the sequence of your wins and losses, but you can control the size of your losses, and the time you spend being right or wrong in a trade.
Internal Audit- Take a hard look at yourself and find areas that need growth.
- Are you coming up short on education?
- Do you have a solid trading plan and a robust methodology, or are you making it up as you go along?
- Do you need to reach out to a more experienced trader for help or invest in more training materials?
External Audit- The most important part of your environment is the people that share it with you. Do an inventory of the people in your life and make sure you are surrounding yourself with advocates. In addition to having traders who understand what your life is like everyday, you need to have friends and family who support you and love you unconditionally. There will be difficult times, make sure your foundation can weather the storm. The best use of social media for traders is connecting with others that share your passion for trading and create value for each other.
- Are you a member of a trading group?
- Do you join in social media conversations with other traders?
- Do you have friends and family that support what you do?
Seek Inspiration- Look for people who have overcome adversity, in and out of the trading world.
- Ed Seykota created amazing wealth for his clients and himself using old punch cards and archaic computer systems.
- Alexander Elder lost a lot of trading capital before he broke through to trading success and went on to help others overcome their urge to gamble.
- Paul Tudor Jones’ passion for trading took him from a cotton trade that almost ended his trading career to billionaire status.
- Nicolas Darvas nearly lost all his trading capital before becoming a multimillionaire.
The most important thing to remember about adversity is that it is temporary. If you are determined, continue to better yourself, and embrace your own determination for success, you will prevail in the trading arena.