Common Traits of Professional Traders
Success doesn't come in easy or quickly for most future traders. The learning curve in trading is steep and many fail to put the required effort towards becoming a successful trader. On the other hand, for those who persevere trading becomes ingrained in their DNA and they become profitable in their trading endeavors. I have had the privilege of knowing some of the best traders and they all operated differently but had core characteristics that were nearly identical.
It takes some time to get to know an ace trader as they are very slow to trust other others in the business and can be very cautious when it comes to revealing their personal trading methodology. I was fortunate enough to get to know some of these top traders and even more fortunate to have one take me under his guidance and steer portions of my career. However, most of the top institutional traders share some very common personality and characteristics that I was able to observe. Some of these traits are:
· Resilience: There are days when trading can be absolutely brutal. Even the best traders lose trades, but when top traders lose a trade they usually don't give the losing trade a passing thought. They intrinsically understand that trading is like a war. You don't have to win all the battles to win the war. Of course, it would be nice if you won all the battles, but your chances of achieving that goal are a big old goose egg. Top performance may lose, but they generally put the loss behind them without much thought and move on to the next opportunity. On the other hand, substandard traders may lose the first trade of the day and find themselves in a hole and make mistakes in a desperate attempt to climb back into the green numbers. Top traders simply continue to do what they always do, which is to find high probability setups and trade them efficiently. They don't look back, and they don't worry about the last setup; they stay in the moment and do what they do best.
· Flawless Technique: One of the toughest hurdles is to hone your trading technique so that you are executing trades at the price you want and the time you want. Great traders never, and I mean never, chase the price around the DOM. They pick an area they want to trade and stick to their guns. If the price action doesn't reach their entry point, that is fine. These guys understand where and when to trade and if the price doesn't reach their entry point they move on. In sharp contrast to top trading technique, novice traders will often fret about missing a trade and jump into a trade either prematurely, at the wrong price, or enter too late to profit. Pick your spot and let the price action come to you.
· Absolute self-confidence: If you don't think you can win every trade you enter you shouldn't execute the trade. It's that simple. You have to believe in yourself, your ability, and your judgment. Believe me when I say that there is no crowd cheering you on to victory as you sit in front of your trading console. If you don't believe in yourself you will trade tentatively and ineffectively. This is a very solitary profession, especially with the gradual phasing out of the trading pits. Great performers are generally unconcerned about what the television "talking heads" are saying or what their colleagues believe the likely path of the days price action. They are well prepared and usually have a plan formulated with contingencies in place should unexpected events change the course of the market. Their technique is generally more sophisticated and better thought out their trading counterparts. They know what they want to accomplish, and have a plan to execute their strategy. The are consummate professional traders.
I would imagine you might be surprised that I didn't divulge some specialized strategy that professional trader utilize, or specialized indicators that give them a special advantage. Trading isn't about indicators or secret setups, it's all about thinking and executing a well thought out plan. Only the amateurs are out chasing the latest hot indicators, the pros don't depend on upon this mode of thinking. It's what is between their ears that give them the edge they need, not on the chart.
Posted on: 10/14/2016