Five Important Tips for Ambitious Traders
For close to 30 years the financial markets have had my undivided attention. Even after all that time, I still find beauty in a trending chart or a well-executed trade. I’m clearly passionate about the markets and I know you might be too.
Are you ready to make this your best trading year so far?
Below are some trading tips I’d like to share – tips that I’ve picked up through good and bad trading experiences over the past 28 years.
1) Create and Follow a Trading Plan
This is a basic one but one many inexperienced traders ignore. If you’ve been trading without an effective trading plan, it’s likely you will fail as a trader.
It’s imperative that you write down a trading plan – how you intend to enter and exit a trade, the position size etc. It’s also important to physically write the plan down on paper and then stick to it! Without a trading plan, it’s almost a certainty that you will fail.
2) Develope a Prototype
Close your eyes and visualise what a perfect trade looks like to you – the perfect entry and exit, the position size you took, and all the other important factors involved with trading.
Once you know what this ideal trade looks like, you will have a greater chance of replicating it in a real trading environment. But if you don’t envisage this you simply won’t recognise the next big trade opportunity when it arrives under your nose.
As a full-time trader and mentor, I am privileged to see a lot of people’s trades. More often than not it’s obvious that they have not followed their trading plan and/or have not entered and exited the trade as per their prototype trade – a real frustration for them, and me!
3) Manage Your Time Better
A common phrase I hear from my students is “I’m working so hard as a trader, there’s just so much to do”. This can be somewhat true however, I often find that my students are not differentiating between the time they spend on their own trading education and the time they actually spend trading.
I understand there is considerable work involved in learning how to trade. But there’s considerable work involved in many other professions too – becoming a doctor, a lawyer, learning a trade etc. However, I can honestly say that trading is the only profession I know of that, once you know what you’re doing, you can typically complete everything within 30-45mins a week.
It’s fair to say that most successful people are excellent at time management. They understand the critical importance of controlling your own time, so you are not wasting your most precious resource. Using “I don’t have time” as an excuse simply shouldn’t enter your mind or come out of your mouth.
You should adjust this sentence to: “It’s not a priority at the moment” – this is far more detailed and much more empowering.
You will need to prioritise ruthlessly and continually ask yourself “what is the most productive and profitable use of my time right now?”. This question will get you focusing on the things that count the most and will have the biggest impact on your year.
4) Learn How to Trade Both Short and Medium Term
In days gone by you could buy any good old stock, sit back and wait for the money to come in. Nowadays, unless you’re extremely gifted (and lucky), you simply cannot do that and expect the profits to fly in the door.
You need to learn how to become a sniper; someone who can enter the market, grab some short-term profits and move fast.
There’s also money to be made trading the medium term but if you really want to kick your results into over-drive, short-term trading is where you need to be.
5) Beware of Your #1 Enemy
Avoid toxic people. You know the type, that know-it-all work colleague or brother in law who have a negative outlook on almost everything. Their negative attitude can frustrate your mind, destroy your confidence and sap your energy levels. If you’re not careful, you can even stoop down to their level.
Unfortunately, toxic people might not even be the biggest obstacle you’ll encounter… There’s something much more sinister and debilitating around the corner – something you need to dispose of immediately.
The number 1 enemy to your trading growth is 2 words: “I KNOW”.
If your mind is full and you believe you know everything, you won’t allow any more information into your head space and you’ll be crippled, not learning, not growing.
I’ve seen it plenty of times with traders who are stagnating and wondering why they aren’t improving as a trader. You’ve probably seen this too or have experienced it yourself? You need to replace “I know” with “Tell me more” – always ready to absorb more valuable information. Try it sometime, it might just help you turn a corner with your trading.
With the right drive, ambition and desire, 2018 could be your most successful trading year to date. By following the five tips mentioned above, you’ll be one step closer to achieving those desired trading results you’ve been seeking.
About the author:
Louise Bedford is a full-time trader and author of some of the best-selling trading books, including The Secret of Candlestick Charting and Trading Secrets. If you’d like to pick up a free Trading Plan Template from Louise, click here.