Do you consider yourself an average trader? Want to know the unfortunate truth about trading? Read on…
The majority of traders fail or lose money in the market. Yet, we continue to hear stories of many multi-millionaire traders who started from the comfort of their own home. Did these few traders get lucky? Is it natural talent? What separates the average from the exceptional?
Here are the top 4 reasons you’re just an average trader:
1. You don’t keep it simple
Does your platform look something like this? Despite the exaggeration, most traders just have too much ‘stuff’ crowding up their trading screen. Whether this stems from the belief that all successful traders must be geniuses, or from companies constantly pushing their own “special” proprietary indicators, over complicated trading seems to be an inherent issue within our field. It’s important to remember that more is not always merrier! We recommend sticking with the KISS method: Keep It Super Simple. The best traders are successful because they know there’s only so much that two eyes can focus on, and they take advantage of it! By simplifying your trading you will trade with a clear and focused mind.
When people begin to dive into the world of trading, it’s natural to want to learn everything you can get your hands on. Between the many different types of trading styles, brokers, and strategies, it’s easy to spread yourself too thin and even overwhelm yourself at times. Don’t be a jack of all trades! (Pun intended). After testing the waters, every trader should choose one style of trading that fits them the best-taking their time, finances, and personality into consideration.
The next step is to define your trading plan; give yourself a set of rules to follow each day and stick to it. By having a game plan and remaining consistent, consistency will show itself in your trades and in your profit and loss statement!
If you’re interested in learning more about daytrading for consistent income, please sign up for one of our free upcoming webinar events by clicking here!
3. You don’t have the proper tools
Do you treat your trading like a business? Like any business owner, a trader must perform the proper due diligence to ensure they have the best tools and can operate at the highest capacity. We stress the importance of finding a good, direct access broker that is affordable and has great customer service. A direct access broker is one that places your order directly into the market, cutting out the middleman. This is critical because as daytraders, pennies and milliseconds can either make or break our profit.
Once you have your trade plan, find programs that you find intuitive and simple to use. In his trading, Fausto himself almost only uses time & sales, the ECN book, and the charts. That’s it-no fancy indicators or expensive scanners. In fact, most of these indicators are showing us after the fact what time & sales and the orders have already told us!
4. You don’t have a mentor
With the previous three points in mind, finding a mentor is the most important step. Sure, most traders find it difficult to remain profitable but the fact is, most of these traders are self-taught! It’s not surprising, considering the trading world attracts ambitious people who prefer the individualistic approach. Yet, ask any successful trader if they have or had a good mentor and most of them will say yes. Every trader will make mistakes but learning from others who have also made mistakes and can teach you about them will quickly propel you into consistent profitability.
We highly encourage all traders to journal their wins and losses. Since emotion is almost always the root cause of trading mistakes, a mentor can objectively analyze your trades and make suggestions on how to improve your trades accordingly.
If you’re interested in learning more about day trading for consistent income, please sign up for one of our free upcoming webinar events by clicking here!
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