Many new traders are taken out of the trading game through bad mental practices. Here are some things that top money managers and rich traders have shared through interviews and books that may help traders who are making mental mistakes in their trading.
Ten Powerful Psychological Traits of the Rich Trader
- They have the ability to admit they were wrong and get out of a trade. They know the place where price proves them wrong.
- They have the ability to not only close a losing trade but reverse and go in the other direction with the right signal.
- The rich trader is not trying to prove anything about themselves they are focused on making money.
- They do not fall in love with an idea, currency, commodity, or stock they will make trades based on price action.
- Rich traders know that the market action is their ultimate boss regardless of their opinions.
- No matter how sure they are about a trade they still ALWAYS manage the risk.
- Rich traders get more aggressive when winning and trade smaller or take a break during a losing streak.
- A great trader is one that can admit to anyone that they were wrong.
- Rich traders do not believe their own hype, they know they can not really predict the future they can only react to current reality and the probabilities.
- Rich traders love what they do, win or lose.
When you are trading with a mindset like that, it is hard to be beaten over the long term. Time is your friend.