Successful Traders - Find Your Independence

Successful Traders

A good trader is strong, independent, disciplined and well educated, and is willing to make and accept mistakes. Good traders are willing to make mistakes regularly. There is nothing wrong with it.

The first rule of trading is to never get caught in a situation in which you can lose a huge amount of money for reasons you don’t understand.

Successful traders can take positions that others are not willing to take. They are disciplined enough to take the right position size. While a greedy trader blows up his trading account eventually.

Good traders always have a predetermined stop and they know that risk management is the key to successful trading. They always know where they will exit the trade before they enter a trade.

The position size on a trade is determined by the stop, and the stop is determined on a technical basis and must be beyond some technical support or resistance level. Rather use a wider stop and trade a smaller position.

They also evaluate risk on a portfolio basis rather than just the risk of each separate trade. Especially when holding positions that are highly correlated, since the overall portfolio risk is usually much greater than the trader realizes.

Most unsuccessful traders would try to place smaller stop losses just to trade a bigger trade size. This usually results in good trades getting stopped out just before the market moves in the anticipated direction.

Good traders never make trading decisions on the spur of the moment. Once a strategy is selected, the trader should stick to the game plan and avoid impulsive trading decisions.

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