If you want to be a successful trader who makes money in the market, you need to have a good mind.
1. Learn to completely detach yourself from live trades
One of the most important skills for a professional trader is the ability to stay calm and not get too emotionally attached to trades. Because beginners and losers are not able to do this, they often end up losing money.
When making a trade, you must be cold-blooded. You could make a mistake that costs you money if you are emotional. You are more likely to make money if you do not let your feelings get in the way.
2. Start thinking of trading as a mental ‘war’
The market is very competitive. You are competing against individuals who have more money, education, or intellect than you.
You have something they don't have; a strong desire to be the best and play the game more disciplined than them. This is how you will triumph over them.
If you want to be one of the top 10% of traders, you need to take your work seriously. This means that you need to be careful when making trades and think about the consequences of each decision.
Don’t let money make you ‘funny’.
People who trade money often have a hard time dealing with the psychological effects of making or losing money. Professional traders know that in order to make money consistently, they need to fix this problem. If you want to fix your trading, you need to fix your mindset about money.
The primary mental hurdles that face traders in regard to their money are the following:
There are two fears that can cause you to lose money in trading. The fear of loss means that you are afraid to take any losses. This can cause you to let small losses turn into big ones. Fear of missing out means that you are chasing trades that you missed and this usually results in a loss.
It's risky to risk too much money on each trade. If you do, you might lose a lot of money if the trade doesn't go well. I've written about this many times before.
It can be difficult to know when to sell your home. Another option is to keep an eye on the market and wait for prices to start declining. If you believe that the market is about to drop, now might be a good time to sell. Another option is to look at comparable homes and set your price based on what they are selling for. Finally,
Most traders fail because they do not have a plan to protect their capital. This is why most traders lose money. You must have a plan for how you will protect your money if you want to be successful in trading.