What differentiates successful day traders from unsuccessful ones?
TRADINGFEATURED
"Expectations run high and it’s hard to just focus on what needs to get done"
Successful traders focus on the action, not the prize.
It’s easy to falter while trading. Suddenly, you get distracted, panic, and make a trading error.
When trading with an optimal mindset, in contrast, the winning trader is focused on his or her immediate experience, the market action here and now.
The best rule a trader can follow is to focus on the action, not the prize.
The biggest mistakes traders make:
Many are attracted to trading for the rewarding profits that can be made. Profits can often buy possessions that produce feelings of self-worth or admiration from family and friends. These can all be strong motivators but the irony is that if you focus on the prizes too much, you can’t trade profitably or consistently.
Expectations run high and it’s hard to just focus on what needs to get done.
When you get your hopes up, you have already decided that you have earned the prize, and the mere thought that you may lose it is devastating.
Losing is no longer a possibility.
The only option is to win. When one works under that assumption, one is usually easily distracted to the point of making a myriad of mistakes that produce losses rather than profits. If you start thinking “I can’t wait to make a profit and bask in the glory of success.”, you will lose focus, you may even start thinking “I must win on this trade.”
The right mentality to have:
That kind of thinking is unproductive in the end. The more you can focus on the intellectual challenge of trading as you make a trade, the more likely you will execute your trading plan effortlessly and trade profitably and consistently. That said, it is fun to think of the big prize occasionally but not during trading hours or very often. it may be motivating during off hours to think about the potential long-term rewards trading may bring. But there is a difference between feeling you must have the prize and merely thinking it would be nice to have the prize.
The true reason for losing:
The thought may even cross your mind during the trading day but it is essential not to dwell on it. If you are only motivated by the potential rewards, it is important to acknowledge that your primary motivation for trading may be the prizes you may win. If you truly believe this and try to block it out of your consciousness, it will creep in and influence you usually negatively. However, if you study this assumption closely and truly convince yourself that it isn’t a good reason to pursue trading, you will neutralize the belief.
Credit: Quora