How to Be a Masterful Trader Part 1 - An Edge

When talking about "An Edge", I'm talking about the trading method that you are using to seek reward for effort while trading, as well as the professional approach that you take to trading.

The method needs to be thought out in its entirety; entries, management and exits to name a few.

You need to know your Edge to the extent that if I or someone else was to ask you to explain it, you would be able to rattle it off and explain every concept in fine detail with no hesitation, you need to know it so well that it is a response and not a reaction.

Discipline to Follow Your Trading Plan

One of the statements that I have made is that "Professional" (institutional) traders are constricted by too many rules and regulations to be classified as Professional traders, but one thing that they do have above the average trader is...
DISCIPLINE

If you do not have Discipline with your trading, you really don't have a Trading Edge at all because; if you are not following the Edge to the letter (by being undisciplined), you are doomed to fail.

Every Successful trader has Discipline and works on their discipline everyday until it is instilled into the depths of their soul.

Method Familiarity

As a successful trader, the key is to become so familiar with your trading method that it negates every emotion that will come up and enter your mind.

The emotions still enter your thought patterns, but knowing your trading method inside out and knowing the markets gives you the ability to keep those emotions in check.

The easiest way to obtain familiarity is to enrol someone who is more experienced than yourself and watch what they do and just as importantly is to watch and learn what it is that they actually don't do.

The Mental Ability to Accept Losses

A successful trader always knows that there will be losses along the way, it's a fact of life, even I do the occasional losing trade but the difference is that I don't let it stop me.

If you are in the conversation of blaming the market, the big traders, banks, insider traders or other "unseen forces" for your trading losses then you are actually accepting failure instead of standing for your God-given right to be successful.

The Mental Ability to Accept Large Gains (SELF IMAGE)

Now this may seem funny to talk about, but it is extremely important.

Consider this, there have been numerous studies done on how people set limits on their success, but the following one that sticks in my mind.

There was a salesperson who believed his net income value was $4,000 a month after tax.

So entrenched was this belief that one month he had only made $1,000 dollars in first three weeks and in the next week after a little panic attack, he made $3,000 to bring him up to his $4,000 income.

In another month he had made $6,000 in the first week and then in the next three weeks had actually lost $2,000 in cancelled orders, reducing his commission back to his $4,000 expectations.

How many times have you heard about people winning the lottery only to be back where they started in less than a year?

On a more personal note, how many of you have made or been in front of your trading target for the week only to put it all (or even more) back into the markets in silly trades?

Its all about where you set your worth (self image), so to make more money or more pips in the market you may need to expand your self worth or self belief.

Trading Maturity

For me, Trading Maturity is a deliberateness of action (intent).

It's someone who knows what they want and will not accept self disbelief as an excuse to fail.

It is the willingness to examine one's own beliefs in an objective way and transform those beliefs if needed.

Develop a curiosity in studying your own behaviour, along with a willingness to work out what makes you "tick" or react/respond in certain circumstances.

In Conclusion

A successful trader is always prepared to look into what is working and what is not working in their trading performance.

They are willing to ask the hard questions about their belief systems and come to terms with the limiting traits and habits that hold them back - looking into ways that can turn their flaws into strengths.

So my question to you is: "Are you prepared to do what it takes to be successful or are you going to let society impose its limiting beliefs on you?"