Trading Psychology

How To Kill Your Trading Career In 4 Easy Steps

From http://www.attitrade.com/

Trading is like any other skills based activity in that it takes time and practice to become proficient. There are no short-cuts, at least none that lead to longevity in the markets. Ask anyone who trades for a living and they’ll tell you about long hours spent poring over data, charts, earnings reports, etc. Those charging you thousands for their “market secrets” would tell you otherwise.
The rewards of making a living from the markets are numerous and well worth the effort. If you treat trading like a career rather than a job or an ATM then your natural desire would be to work at it at least 40 hours a week.  I’ve had many 12 hour days in my trading career, even a few that lasted 16 hours because I was hedging a position with futures. I wouldn’t trade those long hours for anything as that sweat equity has paid big dividends over the years.
However, if hard work, self-discipline, and learning isn’t your idea of fun then I’d suggest following these four steps below to help you exit the trading world as fast as possible.
1. Trade mismatch

Probably the most common way to blow up an account and end your trading career is to participate in the wrong market and/or employ the wrong strategy. Many walk away each year from the markets jaded and penniless because they tried to trade a strategy/system that works for someone else without giving a thought to whether or not they had the psychological makeup to produce a profit over a sustainable period. I’m referring to matching a trading style with your personality.

You wouldn’t go into a store and grab the first pair of pants you see because they look good on someone else would you? No! You’d shop around, try a few pairs on and make an informed decision about which pants work best for you. Trading should be no different. Don’t make it more difficult that it has to be.

2. Limit resources

With today’s technology and the vast availability of free information out there it’s impossible not to take advantage of it like a $4.95 all-you-can-eat buffet. Seriously though, trading takes time and money so proceed knowing that you will not make a fortune in your first few weeks, despite what others may have told you. In fact, it may take a year or more to master a setup or strategy and turn a profit.

Spending most of your capital on “education,” leaving a small amount to trade with, will no doubt crush your dreams of being a successful market participant. You need to be well funded in order to survive the learning curve that is the market. There is no way around this.

3. Go it alone

Bottom line is that without a good mentor, or even more than one, you will die a lonely and poor trader. There are great resources out there, many of which are free, that can provide education and an opportunity to meet others and perhaps create a lasting relationship that could lead to many mentoring opportunities. StockTwits is a great example of free resources out there with people ready to lend their knowledge about trading. Other examples include local universities, trading organizations, and virtual education centers.

The point is that you wouldn’t start any job, let alone one you wanted to make a career, by jumping in head first. Sniff around a bit, visit your local library and check out some books (Google books works as well) and do some legwork. Find the email addresses, phone numbers, twitter handles, etc. of people that seem to know what they are doing and hit them up for advice. You’d be surprised how willing most people are to share their knowledge.

4. Be overly self-critical

It’s real easy to pick out and focus on the negative aspects in life. Trading is no different. I’m not suggesting you trade with rose colored lenses but rather focus on the positive things you do. The negative mindset is a cancer and will overcome the positive aspects of your trading if you let it. I have yet to meet a trader that hasn’t made numerous mistakes. It’s those traders that learn from their mistakes while focusing on positive outcomes that find longevity in the markets.

It’s easy to lose in the markets and walk away with a negative attitude about how it’s a rigged game. After all, you’re just one of the little guys that can’t be expected to compete with the Goldman Sachs of the world. Don’t be a statistic, man up and be a legend.