Trading and investing is no walk in the park. The future is always uncertain and as we move into the unknown, we often find ourselves stepping in a big pile of mess. Most involved in financial work look to achieve a return on investment capital that can match or exceed their respective benchmark. For most of us the SPX 500 is a good measuring stick.
But as we close out one year and start another we take a moment to remind ourselves what trading success looks like. We have to remember to always leave our ego at the door, remain humble but aggressively go after the prize. Our success comes from the many hours of learning, studying and researching ideas, then applying the skills to hopefully come out on the winning end. But it doesn't always end positively, so we have to train our minds to shake it off and keep moving forward, making that next trade.
We often forget about the little things that help us become successful traders. Let's review some of these here, take stock in what we are doing, and pledge to move forward and keep on learning.
1. Manage your risk. This is the most important of all of your skills, keep yourself in the game.
2. Know when to sell. So many traders have difficulty with this part, if you can't find the sell button you're doomed.
3. Size properly. I've come across many traders who think they have the keys to riches, they go 'all in' and wind up in the poor house. Know what you can lose and accept the result.
4. Keep dry powder handy. Opportunities will always arise, but you can't take advantage if your cash levels are too low or nil.
5. Learn more and more. Experiment, take chances, feel the risk taking and how it affects you, practice and read more. Your growth curve will grow exponentially, just as your account will do the same.
6. It's okay to lose. Not always losing, but losses are part of the game. Trading is not a game of perfect, you'll recover from a loss if it's not a devastating one.
7. Let the market tell you what to do... don't LISTEN to outside influences. They don't have your best intentions and often try to deceive. The market/chart will never lie to you.
8. Play the market that's in front of you... not the one you want it to be.
I never stop learning. My growth continues each and everyday, I learn something new from some article, blog or just from my trader friends in the chat room. This helps me be the best trader/investor I can be, and I hope you will have great success down the road.