10 Habits of Highly Successful Traders

Welcome to the first instalment of the new Trade With Precision blog!  We LOVE trading and we have a great team here who love talking about trading. In the coming months we will be showcasing a wide variety of new content from the TWP Trading team, including some great new speakers.

There are many trading topics that we can and will write about for future blogs. There are also many good habits that successful traders practice. I have picked just 10 of these good habits for today’s blog.

1.     They are Passionate

First and foremost trading must be stimulating for a trader to be successful in the long term.  It must be the kind of thing that excites a person to get out of bed in the morning. Great traders with day jobs will skip the evening television session or social invite to scan the market for trades instead. 

I recall my own ‘honeymoon period’ when I had just started trading and it was the first time in my life when I looked forward to Monday and was somewhat disappointed when Friday rolled around.  I had found my passion!

2.     Strong Determination to Succeed

Failure is not an option! Not ever! There is no such word in the successful trader’s vocabulary!

If you want to succeed in any area where many do not; whether it is trading, sport, business, or another challenging endeavour, you simply cannot be the kind of person who gives up after the first failed attempt.

3.     They are Humble

Well maybe not every trader on the planet is humble, that would be a rather big overstatement.  However, I can confirm that the ones I know are indeed humble and it is a key factor that we teach people who are looking to generate success.

Being humble is something I teach in my private mentoring sessions, it is something we request of our staff. Humility is also one of Trade With Precision’s company values.  We do not boast about individual achievements and this, we find works very well for us on both a trading level and a business level.  We have noticed it also works very well for the people that we teach to trade!

4.     They have Positive but Realistic Expectations

If your expectations are negative then you might as well not start. It is simply too easy to prove yourself right.  However, on the flip side, if you expect to make 20% every month like the world’s greatest investor, then you are also doomed.

If you think big you can achieve a lot in trading. Expect to win! It is vital! Just do not expect to set the world alight overnight in trading any more than you would expect to race in Formula 1, win the US Masters or play for the Chicago Bulls anytime soon.

5.     They Focus on Risk Management ahead of Making Profits

The transition from amateur to pro comes on the day when the amateur genuinely accepts that risk management is more important than profit and focuses most of their attention in that area. Like it or not, admit it or not, most new and inexperienced traders focus on profits and get losses. Start focusing on protecting what you have and you give yourself a fighting chance of turning a profit!

6.     They Enjoy the Learning Curve

It should be fun! It must be fun if you are going to survive the ups and downs of learning to trade. Trading has a learning curve just like any other profession. If you treat learning to trade like an apprenticeship or a university degree, you will accept that nothing happens overnight and the learning process can be both fun and enjoyable.

7.     They Keep Good Records

Trading is a business and it should be treated like one.  Good businesses keep records on profit, loss, trends, etc. They also have a plan. Good traders keep good records.

8.     Good Traders Learn from Mistakes

Learn from your Mistakes, a statement that can be be applied to the vast majority of  successful people from all walks of life. Most succeed by learning through their mistakes. You have to ask why some of us go to such great lengths to avoid getting things wrong when getting things wrong is the only way we ever eventually get things right! 

Tell me a single thing you have learned that is any harder than cooking a piece of toast, that you did not learn to master, through making mistakes initially?  It is just the way life is, and trading is no different. Embrace risk and embrace mistakes so that when you make them you can learn from them rather than fretting over how much you might have lost.

9.     The Best Traders Focus on Flawless Execution

An extensive subject and a topic that warrants a book of it’s own! One day I may just write such a book but for the purpose of this blog, I will attempt a précis of this subject and revisit it again in the future.  The best traders have a strategy that is well tested and proven. They place trades according to that strategy and judge themselves on how well they executed the strategy. They are always striving for flawless execution.

Losing traders on the other hand, if they have a strategy at all, base the success of each trade on whether it was a winner or a loser. They do not yet realise or accept that the outcome of any individual trade is random and has nothing to do with the quality of the trade. After all the very nature of the markets is that bad trades can make money and good trades can lose money.

Hence good traders do not focus on the P/L, they focus on how well they traded.

10. They Persist!

If you persist and adopt the above 9 habits then you will give yourself every chance to succeed. When you get knocked down, get back up. If you fall off your bike, give it one more go. If you stall the car, try again until you get it right. And when you place a bad trade, do not take it personally but learn from it and move on.

It is all a fun part of the learning curve if you stick to your rules and approach trading the right way as described above.

How do you compare against this list?

Go out there and make your own luck!

Many of these pointers are discussed in a lot more detail on our webinar, How to Become a Successful Trader, which just happens to be running this week. I hope you will join us!

Thank you for reading our first blog.

This week's webinars from Trade With Precision:

• Intraday Trading Myths Exposed - Tuesday 18th March @ 4pm New York, 8pm London, 7am Sydney (next day), 9am Auckland (next day)

&

• How To Become A Successful Trader - Wednesday 19th March @ 8pm New York,  11am Sydney (next day), 1pm Auckland (next day)