Blog #17 - The Traits Of A Successful Trader - Finance With Atul

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Saturday, June 5, 2021

Blog #17 - The Traits Of A Successful Trader

The Traits Of A Successful Trader

In this pandemic time many people have lost their jobs and in this situation making the source of earning is very difficult. I know few of my friends who were hired at lucrative packages from college placement but now they are at home. I am not blaming them. The pandemic has brought the world to the knees. Many people, after the pandemic, have been jumped into the share market. According to SEBI (Securities & Exchange Board of India) there is a 63% rise in the opening of demat accounts against the last year. People think that share market is one of easy way to earn money but in my opinion it is the best way to lose money because trading in share market is not a kid play. It can cost you throughout your life. I am not saying that you should not trade but first acquire knowledge and skills then enter the market. Let see some traits of a successful trader.

 

 

# 01. A disciplined trader has a trading plan and does his homework diligently.

A winning trader first decides a strategy. He diligently maintains charts and keeps sometime to analyze market. Every evening a winning trader updates his notebook and writes the strategy for next day. A born trader has a strong sense of market trend; he identifies the strongest sector and then the strongest stocks in that particular sector. He develops the strategy to enter and exit from the stock at the right time. Good technical traders don’t worry and debate about news flow, irrespective of it, they go by charting signals.

 

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# 02. A disciplined trader avoids overtrading.

A good trader always evades overtrading and for this he does his homework carefully. This gives him a strong perception about the market and what should he do in market. When a trader is clear in its vision, he can take right trades and back them up sufficiently. Market always tries to mislead traders by swinging in both directions. The traders who don’t know the market is trading or trending obviously can’t decide whether to sell or buy. They implement wrong strategy at wrong phase o market. And by the end of the day their broker gives them a big statement along with the losses that they made. By this way they are giving benefits to their brokers.

Overtrading is the single biggest malaise of the most of the traders. A disciplined trader is always ready to trade light when market turns choppy and even not trade if there are no trades of the horizon.

 

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# 03. Doesn’t get unnerved by the losses.

A good trader knows that every trader is just other trade, he is always cautious and that is why he uses money management skills. He never over leverages and always as set ups and rules which he follows religiously. In this practice he bears loss and tries to understand why market moved against him. Often he gets important trading signals from his losses. At this point I would like to point out that one should not get into an ego tussle with the market because market is always right. Sometime market gives confusing signal and at that point your effort should be to avoid trading. 

 

 

# 04. He always tries to capture large market moves.

Most of the novice traders’ books profits too quickly because they want to enjoy their innings and sometime even media exaggerates this. But in my opinion novice traders actually lose their account equity quickly because they don’t book their losses quickly enough. On the other hand knowledgeable and experience traders also lose their trading equity but slowly – if they are satisfied with small profits.

Those who trade for a living cannot sustain an equity account that is not growing. Thus when you believe you entered in large move, you need to ride it out till market stops acting right. A good trader is always balanced between saying in the move as well as protecting his equity. Capturing a few large moves every year is what really makes worthwhile trading profits.

 

 

# 05. He always learns new trading techniques.

Trading is not an easy work and it requires days, weeks and several months to become a successful trader. But what makes them a good trader? The answer is their ability to learn. Learning in any field can make enhance your skills. Similarly a good trader keeps reading all new research on technical analysis that they can get their hands on. They read a lot of book every month about the new techniques, about the psychology and about other successful traders and how they manage their accounts.

 

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