Hello subscribers and readers, if you just stumbled upon this blog, greetings to you too. Feel free to subscribe for future blog post notifications. In this post, I share 5 things that traders need to understand.
You Will Get Scared
Being scared is normal for a beginner trader because trading can initially be scary. The biggest challenge though is when you allow it to turn into fear. Allowing it to turn into fear means you let it affect you long after you’ve experienced it. Fear can also be crippling.
Most traders deal not only with their fears but also the fears of others. They carry other people’s stories as their own. They could read stories on the internet about how others have lost money and been scammed through Forex schemes (there are plenty of those). Acknowledge that you are scared but don’t make other people’s stories yours, create your own story. I have published a mindset booklet ” titled “Shift your Mind Shift your Money” to help you fix this because winning starts in the mind.
Being scared is not a permanent state. Scared money never grows. Being too scared to take a trade will result in you parking your money in a trading account and never utilising your trading skills on a real level. The only way to get over the fear is to place trades whenever opportunities arise.
You Will Panic
If there’s one thing that a beginner trader can’t escape is panicking. We all start trading on the demo account before trading the live/real account. Whatever emotions we work on while trading on the demo will need to be worked on again after starting a live account. This is simply because you can’t assess your emotions while trading fake money, everything you feel is on a demo level. For that reason, it is in your best interest to not trade on the demo account for too long because it’s not a real thing and it doesn’t challenge you on a real level. I have published a podcast episode on this topic, you can listen HERE.
To remedy this, the best thing to do is to detach from the money and focus on getting it right while trading a small volume/lot size. Panicking a lot will make you miss great opportunities or even close your trades prematurely. When you panic, you are also likely to want to place a trade on the demo first before placing it on the live account, which delays your progress. You become a better driver by driving on the real roads not on a sport field where you don’t encounter real traffic and driving among other cars and drivers. Detach from the results and focus on the process of getting your desired results.
You Will Have A Crappy Trade
I know you don’t want to hear this one but you won’t always be 100% correct. There will be times when you won’t get the results you want, make bad decisions, and get into a bad trade. What separates winners from losers is the actions they take when that happens. You should have an exit strategy that doesn’t harm your account or lead to a margin call.
You Will Need Emotional Control
Like most beginner traders, you are likely to battle with that small voice that keeps telling you you will lose money. You have probably lost some money before and you know maybe a few people who have lost money in trading. Detach from other people’s stories as mentioned in the above paragraph and focus on creating yours. To overcome that nagging voice you need to understand that there is risk involved in trading just like there’s risk involved in any investment or business and risk can be managed.
You Will Feel Like Giving Up.
Yes, you will feel like giving up especially if you are desperate to see the results. One thing that can help you is to view your trading account as a business and understand that a business needs you to be patient and for you to nurture it to grow. I have published an episode on my podcast about what to do when you feel like giving up.
Risk can be managed, but you will need to manage yourself as well, take calculated risks, and learn how to manage your trading capital. Keep a Trading Journal to help you track your progress and do not dwell much on what you can achieve daily, rather do a weekly or monthly progress. I have published a trading journal to help you do just that.
Thank you for taking the time to read this post. Please help me reach as many traders as possible by sharing it. For all your practical and realistic trading psychology needs, you can follow and indulge in my podcast.
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