Have you just started your trading journey? Do you feel overwhelmed? Do you wonder why different people get different results even when they use the same trading strategy? These may be some of the few questions that come to your mind.
First of all, beginners don’t have the same level of knowledge and experience compared to professional traders. Secondly, feeling overwhelmed is fine, but make sure to do something about it.
Although traders have different ways to achieve success, looking for inspiration or someone to look up to is also a great way to start. But before you start following a trader on all your social media accounts, make sure they have all the characteristics of a professional trader. In this article, we’ll give you some of the characteristics you should look for when choosing your trading idol.
1. Discipline
One of the most important characteristics of a successful trader is discipline. When looking for trading tips, one of the things you often encounter is to create your trading plan. It doesn’t matter what trading platform you use, like metatrader 4 or cTrader, as long as you have a reliable plan, you can have successful trades. Unfortunately, many beginners tend to forget about their trading plans and rely upon their gut feeling, which is a wrong practise.
Meanwhile, a successful trader doesn’t ditch their plans. If the market goes the other direction, they always find the right time to implement their trading plans.
2. Deep Understanding and Continuous Learning
Successful traders have a deep understanding of the markets and trading strategies. However, they don’t stop once they know how to trade. They stay informed about the current market situations and educate themselves about the developments in the trading world. For instance, if a professional trader is used to metatrader 4, they would at least try using metatrader 5 and see if the new tools can help them trade more efficiently.
3. Emotional Control
Another characteristic of a successful trader is to control their emotions. Whether you’re a beginner or have been trading for quite some time, you can’t avoid being emotional. However, one thing that professional can do is control their emotions. If you become too emotional, your decision-making can be clouded, leaving you with more losses. On the other hand, if you can step out for a second until you calm down, you can still make up for your losses by following your plans.
4. Risk Management Skills
Effective risk management strategies are the key to cutting down losses and preserving your capital. Some of the most common risk management tools include setting stop-loss orders, limiting position size, diversification, and analysing risk-reward ratio.
Usually, professional traders know the right combination of these risk management tools that can help them achieve successful trades.
5. Patience
Trading success takes time. If you abruptly dive into trading without any preparations, you might lose all your money in a day. On the other hand, if you take the time to learn about trading strategies, understand how the market works, and practise using a demo account, you can see your improvements.
It’s not just about knowing how to trade. Trading itself takes time. Sometimes, the market isn’t in your favour, so you need to wait. For professional traders, when they have enough experience, they can be patient for the perfect timing.
6. Analytical Skills
Diving into the world of trading isn’t easy. It requires skills, such as fundamental and technical analysis. Once you understand these two, it can guide you in crafting effective trading strategies.
Meanwhile, professional traders leverage their analytical skills to move forward. They analyse various economic reports and historical charts, and study patterns and trends that can lead them to making informed decisions.
7. Adaptability
As mentioned, the market often changes and you can’t do anything about it. However, you can adapt to these changes by tweaking your strategies and staying ahead of the curve. For beginners, it can be hard to let go of the strategies they’ve prepared so they end up implementing it anyway.
As for successful traders, they can immediately apply the necessary modifications once the market condition changes.
8. Decisiveness
Changes don’t just apply to strategies, but also in making decisions. There are instances when you have to make a decision that can significantly affect your trades, so you should always be prepared. Failure to make these decisions can sometimes lead to missed opportunities and losses.
9. Passion and Commitment
Successful traders are passionate about trading. They spend ample time and effort improving their knowledge and experience in the field. As a result, they know how to navigate the system. Although there are times that the market still goes in the other direction, professionals can still analyse what went wrong in their strategies. So, if you can’t commit and aren’t passionate enough to pursue trading, maybe it’s not for you.
Final Thoughts
Becoming a successful trader requires more than understanding the basics. It can also be described as a lifestyle since there are certain characteristics you should embody to become a professional. In the meantime, these characteristics can be a great guide to finding the right trader to look up to.
ABOUT THE AUTHOR
Aliana Baraquio has over 5 years of experience as a writer and market analyst. She specializes in developing beginner-friendly trading techniques and tutorials. Additionally, she suggests FP Markets as the top broker for trading CFDs and Forex.
