For anyone who has broken into the trading industry, learning to trade the financial markets can be overwhelming. Becoming a successful trader takes much more than following some online instructions or learning a few techniques to begin making a profit. In actuality, it can take a number of years before you can start to consistently generate profits from trading.
A self-taught trader, Certus Trading’s Matt Choi CMT gained his knowledge of the markets through years of experience of trading his own money. He also had to overcome some major milestones that got him to the successful swing trader he is today.
If you want to get to the next level as a trader, here are 3 important lessons for achieving your goal from trading instructor, Matt Choi.
Find a mentor
Finding a mentor who has already achieved what you want to accomplish can make the difference between instantly earning a profit and sitting on potential income for months. With the help of a mentor, you can find that the formula for success is actually quite simple. A mentor can help you to understand your “trader personality” whether it’s day trading, swing trading, etc. and they can help you to acquire a winning mindset.
A good mentor is also able to pinpoint your strengths and weaknesses as a trader, and can teach you valuable risk management skills. Having the right mentor, in particular someone who plays to your strengths, can help anyone achieve success at a much faster and sustainable pace.
Leave your emotions behind
The psychological aspects of trading can be draining due to its “rollercoaster” nature. Knowing how to manage your emotions is vital to becoming a winning trader. If you can’t handle the pressure, you won’t get far.
By following a more formulaic and technical approach to Forex or stock trading you can keep your emotions in better tact. Using technical analysis to derive strategies which are based on rules is a more clean-cut approach to trading. For example, if a stock does A, B, and C then you know there is an 80% probability that it will do D. It’s very formulaic. And because you must follow the rules, it helps keep your emotions in check. It’s all about the chart and the price action. There’s no guessing and there’s no emotions involved.
Do not be afraid to fail
To be financially successful in any endeavor, there are three must-have factors to abide by. Number one is having a passion for your industry and then mastering it. You have to be able to take an interest in the industry. You have to be willing to learn about its history, and how it has evolved over time. Once you have a good understanding, you can start honing in on a few things that work best for you.
Number two is you must have is a passion for success. Look at what the best of the best are doing out there. Copy it. Then turn it into something that is your own.
The third must-have success factor is not being afraid to fail. Thomas Edison said, “Many of life’s failures are people who did not realize how close they were to success when they gave up.” Eventually you will learn from your mistakes and your thinking will become more unconventional. Even if you lose a lot of money in the beginning, work even harder and put more time in to learn the tricks of the trade. Eventually, it will pay off.
Most importantly, Matt Choi says to never dwell on the past. Instead, he suggests to keep executing the next play without hesitation.
“I don’t think about my recent three trade losing streak, but focus on winning the next ten. Believing in yourself, knowing that you do it because you have done it time and time again gives you the confidence to seize the moment and be successful.”
Image credit: Trading Lessons via Feylite/Shutterstock