Below are some qualities that I think are present in all successful traders. I believe that if a trader is missing on any one of these qualities then it will be difficult for him/her to succeed in the trading career.
- Discipline– Discipline includes a lot of things like:-
- Completing Homework every night
- Game plan for next morning
- Religiously following the rules
- Sticking to the plan and not diverging away from it
- Greed- Be self aware and notice when you are feeling greedy. Replace the feeling of greed with looking at the chart and taking a decision objectively. Don’t push away from the feeling, just let it come and decide to take action.
- Fear- Fear usually arises when I have a lot of unrealized profits on the table and also when I see my setup hitting but not able to push the button to take the trade. Once again you want to become self aware of these situations and whenever they arise you need to take control and take a decision objectively without letting your emotions rule over you. Remember that you can always stop your losses and keep them minimum if the trade doesn’t work. Fear also comes in when you see a lot of volatility and don’t want to miss the profits. You take the position too early without any setup and it immediately shows a huge loss because it reverses immediately either from the breakout or gap up. Realize that this is the game that market makers play every day with human emotions.
- Hope- When the trade is taken and it reverses on you, the feeling of hope sets in. You start hoping for position to reverse and show you a profit. What you need to do in this situation is to close the position and go on to the next trade. Don’t waste emotional capital on trades that are not working. Self awareness is the answer.
- Regret- Regret sets in when you see a setup but you don’t take it and it keeps going higher. Another reason for regret is when you close a position only to see it going higher and then you start calculating your gain on the position had you not closed it. You need to accept that it is better to concentrate on other setups rather than regretting the decisions that have already been taken. Stock market is full of opportunities and if one goes away there is always the next one around the cornet. Be patient.