Becoming a successful stock trader is not an easy thing , one needs to toil hard and work towards developing a strategy as per their trading style , any magical technical indicator or any course from trading gurus will do you no good , you won’t be able to even recover the costs of such courses by using their techniques , hence the only way is to toil hard , develop a trading strategy , back test it , paper trade it for some time and then delve into the market .
Below are the 5 qualities that every successful trader has –
1. They focus on strategy rather than profits
One of the biggest quality that every successful and experienced trader has is that they focus on their trading strategy and trade the strategy rather than the profits , while they may look at technical charts tick by tick but they avoid looking at the PL screen , focusing on the strategy is very important and must be the first priority of every trader , excessive focus on profit and losses and looking at the profit loss screen again and again will lead to only psychological barriers while trading in stock market , we have discussed why you shouldn’t give excess emphasis on P&L in other article in detail – here .
2. They have a robust risk management in place
Successful traders deploy a robust and proper risk management system while taking every trade , risk management is equally important to developing a strategy and having an edge in the stock market , without risk management its not possible to come ahead of the market in the longer term , in stock market its not of importance if you earn today or tomorrow , its more important to be in profit in a quarter or year for which you need to place proper stop losses and have a risk to reward ratio of at least 1-2 or 1-3 which makes sure that you loose few bucks on your bad trades while make significant gains on successful trades.
3.They accept losses (if any) and move on –
Good and successful traders aren’t afraid of losses in stock market and know how to take small hits as per their risk management , they also dont linger on to their losses they know with proper strategy and risk management they will come ahead of the market in the longer term.Lingering on to losses and trying to revenge trade is the quality of a bad trader . Accepting losses without blaming the stock market or your strategy is very important , one shouldn’t hop from one strategy to other if one has incurred losses on few trades.
4.They don’t hesitate taking valid trades as per their setups-
After a string of losses a traders psychology can be hit pretty bad and they can start blaming their strategy or even the market for their losses , if one starts doubting their strategy they can hesitate taking the next trade even if the trade fits perfectly in the strategy and their trading setup , a quality of successful trader is that they don’t doubt their strategy after 2-3 losing trades and trade the next valid setup without any hesitation , because if they don’t take the next few valid trades they might miss the good trades which further exacerbates the previous losses in a psychological way , hence don’t hesitate to take valid trades as per your strategy.
5.They have desire to learn and improve everyday –
A person whose desire to learn has vanished can be considered dead , if a person says that “I know everything” he is even worse and would end up in a large hole of losses sooner or later , learning new strategies , listening to others experience and improving themselves is what makes a person a great trader , if you have started thinking that you know everything then you are wrong my dear friend , learn anything new everyday , keep improving yourself that is how successful traders survive the tide against them and come out ahead over the longer term.