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Inherent in new traders' decisions is the belief that trading is easy once they possess the "holy grail." As their accounts start to change either up or down, the traders will start to form psychological opinions that ultimately cause their demise and loss of trading funds. This happens whether the trader is initially profitable or starts losing from the very beginning. |
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The trader's success is ultimately determined by his or her psychological perceptions and beliefs. Most if not all new traders really believe that there is a "holy grail"in the form of a computer-based trading program that all successful traders use with some minor variations. New traders are convinced that if they have the same computer trading program, the same sources of information, and the same data feed as a "trading wizard," they too will be wildly successful. Most new traders believe that success in trading can be bought by installing a trading program or reading a few technical books. |
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In their work lives, if these new traders were asked whether reading a book could lead to professional success, they would have a hearty laugh! Whether they are doctors, business owners, or service professionals, they all know that the only way to become a success is through years of commitment. Why, then, do most new traders think the learning process can be short-circuited? |
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Most new traders honestly believe that they can take the same skills they developed to get to the top in their chosen profession and apply them to trading. These skills are typically hard work, study, persistence, and experience. |
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How do you as a new trader avoid making some of these mistakes in the first place? The easy answer is to realize that your trading success will be ultimately determined by your psychological perceptions, beliefs, and attitudes. The trading game is played out in the six inches of space between your ears! Just as in golf! You need to make sure the beliefs that you develop about trading are based on logical and correct assumptions. |
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In any profession, from doctor to football player, there are certain truths that dramatically increase the speed of success. A football player lifts weights and physically pushes his body to its limits so that he can be a strong performer. However, a physically powerful football player is worthless if he lacks a valid strategy and, as you will see, certain key beliefs and values. Similarly, a trader must expand his or her knowledge of trading strategies and must also possess certain key beliefs and values. |
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There are certain universal truths about trading that all successful traders hold dear to their hearts. These universal truths constitute the actual "holy grail." Once discovered, the truths are self-evident, yet they are very hard to unearth without a lot of hard work. |
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