How to be in 10% of traders?
The statistics say, more than 90% of day traders lose money. If we talk about characteristics of the traders who lose money in the market then out of 90% of traders, 10% - 15% of traders have high work ethics and the rest 85% - 90% have a low work ethic.
To become the part of the 10% there are too many things you need to do, if it that easy everyone would be part of it.
Here the low work ethics are always going to lose money guaranteed. Now, if we talk about high work ethic traders they have broken again into two parts, one part of traders will be fed up with the bad info and the rest will get the good info.
Traders who are fed up with bad info never gonna make money. Again the traders having good info are bifurcated as bad trading psychology traders and good trading psychology.
How to be in the top 10% of traders
To become a successful trader, you have to find a way to streamline yourself into the following steps :
Losing trades → High work ethic → Good info → Good trading psychology
Don't run after a perfect system (totally time waste) rather than try to develop a system that'll make more than it gives back on its winning. To put it another way, lose small and win big.
Accept that losing is a part of the game and learn to manage it. If your trading strategies fail then square off your position and look for other opportunities.
Journal your traders for defining :- Your interesting strategies
- Observation about charts
- Lots of use of patterns
- Your losing trades
- Your good experiences (winning trades)
Manage your trade size i.e position sizing. Being wrong is part of the game hence proper risk management is a vital part of the trading. Proper position sizing provides an insight into calculated risk on any trade. Pro-level traders take position sizing very seriously and apply it cautiously.
Last but not least, trading psychology can be as important as other attributes and it refers to the emotions and state of mind. Emotions like greed, fear, impatience, pride, and anger can impact your trades.
- Fear drives decisions that appear to avoid risk and generate little return.
- Greed drives the desire for excessive profit.
- Anger drives decisions that can be too risky.
Trading psychology is a vast topic to discuss. We'll discuss trading psychology in detail in a separate section. That's all for now. Happy trading.