If you’ve done much research on the success rates attached to stock trading, then you most likely already know a bit about how challenging it is as a career choice. It’s definitely not something “just anyone” can do. That’s exactly why only 10% of today’s traders really make money doing what they do, while the other 90% don’t.
What does it take to be one of the real greats? How can you as someone new to trading make sure that you’re part of the 10% and not the other 90%? The following are some of the most important qualities that all successful day traders have in common. Do all you can to cultivate them yourself and drastically increase your chances.
1. They put in their 10,000 hours.
In his book Outliers: The Story of Success, Malcolm Gladwell introduced the world to something called the 10,000-Hour Rule. In short, the rule theorized that in order to master any skill, one must put in a minimum of 10,000 hours practicing that task. (That adds up to approximately 4 hours a day for a total of 10 years.)
Unfortunately, most new traders are interested in the field because they see it as a get-rich-quick scheme, which it most definitely is not, so they’re not prepared to put in the effort necessary to learn a new skill. They quickly become part of that 90% we mentioned above. Be different. Approach trading the way you would any other focused trade, and be prepared to put in your 10,000 hours.
2. They believe in education.
Day trading has something else in common with trades like medicine or law. The value of a solid education in trading is priceless. That said, all of the world’s most successful traders make an ongoing investment at some point when it comes to learning everything they can about the field. They make it a point to keep learning and researching, the better to stay ahead of the game.
3. They think like individuals.
Truly excellent traders know how to think for themselves. They work hard to refine their instincts and they listen to them with confidence, instead of letting other people’s opinions or news get in the way. There isn’t room for sheep, followers, or insecure people in the trading world. All of the greats think for themselves and rely on their own analysis of the information at hand.
4. They’re adaptable.
Technology is evolving at an ever increasing pace. So are the going market conditions. That said, a successful trader knows how to adapt and adapt quickly. To do otherwise is to quickly become obsolete. As touched on above, constant ongoing education is key when it comes to staying ahead of the curve and maintaining razor sharp instincts. It doesn’t hurt to be innovative, coming up with one’s own fail safe methods to turn a profit as the market evolves.
5. They plan ahead.
You can’t succeed as a day trader without a solid plan in place. Know what you’re looking to get, not only out of trading as a career, but out of each individual day spent working the market. Start planning long before the market opens for the week and stick to that plan. Planning isn’t just a great way to stay organized, either. For a trader, it’s the very best way to avoid letting your emotions get the best of you if things get tense.You can’t succeed as a day trader without a solid plan in place. Know what you’re looking to get, not only out of trading as a career, but out of each individual day spent working the market. Start planning long before the market opens for the week and stick to that plan. Planning isn’t just a great way to stay organized, either. For a trader, it’s the very best way to avoid letting your emotions get the best of you if things get tense.
6. They’re in control of their emotions.
Speaking of emotions, a successful trader is in perfect control of his or hers. No, really! One of the biggest downfalls for any given trader is his lack of emotional fortitude. Fear and greed are particularly dangerous, so it’s important to make sure they don’t get the better of you. Again, a solid plan, a good methodology, a high degree of self-awareness, and an ironclad understanding of the market are your best tools here.
7. They know their tools.
As with any profession, day trading comes along with its own set of tools. News feeds, DOM, charts, draw objects and more – these are the things a successful trader relies on to do his job well. The higher your mastery of these tools, the more they can help you succeed. Learn how to get the absolute most out of them sooner, rather than later, to give yourself the best chances at success.
At the end of the day, becoming a successful trader requires a can-do mentality and a dedication to self-improvement. Start looking into how you can start building the foundation you need today!