Developing a Trader Mentality
To be successful in trading, you should aim to develop a true trader mentality. That means to have the capacity and attitude that allows to do the right calls in trading.
How do you react after losing 5 trades in a row? How do you react when your stoploss is nearly getting hit? Perhaps the most difficult in trading is to accept that your trade will hit the stoploss, take the loss, and go ahead to the next trade. This is a difficult decision in your trading, but what you need to understand is if your trade reached your stoploss, it doesn’t mean you failed or you were wrong. It means you were doing your job correctly. Following the rules of your strategy, no matter what, is the necessary attitude to be developed.
Winning mentality vs Losing mentality
1. Doesn’t expect to win every trade, but expects positive results
2. Accepts the responsibility of trading
3. Learns from own mistakes
1. Thinks the market targets him and hunts his stop losses
2. Blames the broker, platform, and even the market, for losses
3. Doesn’t admit own mistakes, and so, doesn’t learn from them
These are two fundamentally different ways of looking at the markets. Trader A accepts his losses and tries to learn from them, while trader B will blame everyone and everything for his losses. Trader A knows trading is a responsibility, whereas trader B looks at trading as gambling. Over time, these differences will make these traders go different ways: trader A will strive to become a better trader, and will likely get there. Trader B will hardly learn anything, and if he doesn’t have a lucky shot, he will eventually lose all of his money.
Practical mental configuration
- Your path to successful trading might be frustrating, not because it’s hard, but because there is a lot to learn and you will make mistakes, as everyone does.
- If you’re paying for your mistakes, then learn from them!
- Any person can reach better results in trading if they place their effort on it. That includes believing in yourself.
So, what type of trader do you want to become? Which of traders above would you trust your money? Definitely, the answer will be Trader A, right? Then start working on these 3 points, and achieve a true trader mentality.