FTG Blog - Trading challenges; learn to run before you can jump

Trading challenges; learn to run before you can jump

Why do people want to pursue careers in trading? The benefits of course! The hopes of becoming wealthier would tantalise anyone into trying out the trading scene. So one makes this decision based on the end result of financial gain. Sounds simple enough? Not quite, you need to understand the trading challenges involved.

Becoming a successful trader requires restraint and the ability to overcome the challenges involved. Simply stepping into the world of trading is not going to get you very far, if anything the risk of ruining your savings account and developing a bruised ego is quite high.

When comparing successful traders against those who aren’t, a clear picture emerges and it’s these differences that should be noted down. Those who are solely interested in the final result are the ones that loose big and hardly ever achieve their financial goals. On the other hand if you’re one of the smarter traders, you’ll be more interested in the trading challenges, and it’s these people that are consistently more successful in reaching their financial goals. And it’s this balance that makes up ‘Market Speculating’. So what are the trading challenges?

We’ll start with ‘Self-Control’. Did you have a trading plan? How many times did you break your trading rules? How much did your lack of self-control cost you? How many times have you asked yourself:

Why did I not follow my trading plan? If I did, I would not have ruined my trading account. Why can’t I control myself and follow the rules?

First and foremost, Self-control is a major key and if you generally don’t have self-control in your life then the chances of becoming a successful trader is all for nought. Trading has a way of biting you if you’re not prepared for what’s to come. So take yourself out of your comfort zone and be prepared to face these challenges and accept the fact that you have to change in order to succeed.

Next, ‘Profits and Losses’. We all love profits and don’t much like the losses. A natural reaction is to take profits early but refuse to take losses at a later time. This reaction is extremely common and hardly ever leads to trading success. Plan your trade and trade your plan is a sure way to take losses quickly and hold onto gains until you reach your targets.

And last but not least, never give up otherwise known as ‘Perseverance’. You’ve heard stories of people giving up too early, unbeknown to them if only they had continued, all would have been revealed. For example, a man spent lots of time digging for precious metals or diamonds. He dug and dug and then dug some more and found nothing and later gave up. What he didn’t realize is that he was only a meter away from a big find. A day later someone else came in and dug out a meter of dirt and found a huge gold nugget.

You can’t run before you can jump and sadly in order to achieve your financial freedom, you have to take the necessary steps to settle in for the long run. Begin with small trades and let the results tell you when you think you’re ready to move on to bigger trades. Don’t be too aggressive and don’t be too greedy. Longevity is the key and properly handling risk with position sizing and small losses is the key to longevity. Instead, channel your strong determination into energy that allows you to conquer your trading challenges and follow your rules.