In this short article, I would reveal a few steps (7 to be precise), which aim to make you become a more disciplined trader. It is hard to teach discipline and it is learnt best on your own by making numerous mistakes and not repeating them. Despite that reason, I would try to give seven steps in order to become a more disciplined trader.
Step 1– Have a trading plan in place. Backtest your trading plan. The basic idea behind backtesting is developing confidence and strong understanding of the trading strategy that you are trading. One you are convinced in your trading, whether it is resembling my style of trading or another one, you would be able to step on.
Step 2– You should assume total responsibility for everything that is going to happen to you. You should be really looking it from all angles. Try to imagine extreme scenarios, as well. Like, if someone runs off with your money or a broker rips you off, assume that you were somehow involved in creating that situation. Although that sounds a bit too strong, you would be better prepared for negative things that might happen to you. When you do that and correct your role in what happens, you would have a better chance to stay in the game. Even more- if you stop committing the same mistakes over and over again, you have a great chance to be successful.
Step 3– Find your weaknesses and work on them. Once you find them- eliminate them. If it helps you, develop a diary and write all of your daily trades. Figure out what is going wrong and how you can improve by not repeating the same mistakes again.
Step 4– This step again reiterates all of the things that might go wrong. Determine in advance how you would respond to that situation. In this way, you would be prepared for the unexpected. It is not coincidental I am putting so much emphasis on mistakes- they do happen; things go wrong all of the time and if you don’t have a good plan, it can all tumble down. You don’t want this to happen, so plan, plan, plan!
Step 5– Analyse yourself on a daily basis. You are the most important asset in your trading business, so logically, you should spend most time trying to analyse your actions. Parts of the analysis should include analysing your feelings; also, major things that are going on in your life outside trading. The more you are aware of those issues (and write about them preferably in your diary), the less control they will have over your life and your trading as a result.
Step 6– Determine what could go wrong in the beginning of every trading day. Make it like your early morning ritual. Try to think in terms of what could go wrong and how you will react to that. Like an athlete, your role is to do an extensive mental rehearsal and try to see all different scenarios. This will greatly improve your performance over time and could even place the line between losing and winning. Do this every morning before you start your trading day.
Step 7– The last step in my opinion should be a recap. After every trading session you should be doing a daily debriefing. Ask yourself the question: Did I follow my rules? If your answer is yes, pat yourself on the back. If you lost money, but you still followed your rules, pat yourself on the back. It is better to lose money on some days following your rules than make money breaking them. The point here is to be consistent and consistency is reached through persistence and great discipline.
So, traders… keep improving and don’t let the bad days change your goal. It is important to know where to stop and always remember that the best opportunities are the ones that you wait most for them.
Step 1– Have a trading plan in place. Backtest your trading plan. The basic idea behind backtesting is developing confidence and strong understanding of the trading strategy that you are trading. One you are convinced in your trading, whether it is resembling my style of trading or another one, you would be able to step on.
Step 2– You should assume total responsibility for everything that is going to happen to you. You should be really looking it from all angles. Try to imagine extreme scenarios, as well. Like, if someone runs off with your money or a broker rips you off, assume that you were somehow involved in creating that situation. Although that sounds a bit too strong, you would be better prepared for negative things that might happen to you. When you do that and correct your role in what happens, you would have a better chance to stay in the game. Even more- if you stop committing the same mistakes over and over again, you have a great chance to be successful.
Step 3– Find your weaknesses and work on them. Once you find them- eliminate them. If it helps you, develop a diary and write all of your daily trades. Figure out what is going wrong and how you can improve by not repeating the same mistakes again.
Step 4– This step again reiterates all of the things that might go wrong. Determine in advance how you would respond to that situation. In this way, you would be prepared for the unexpected. It is not coincidental I am putting so much emphasis on mistakes- they do happen; things go wrong all of the time and if you don’t have a good plan, it can all tumble down. You don’t want this to happen, so plan, plan, plan!
Step 5– Analyse yourself on a daily basis. You are the most important asset in your trading business, so logically, you should spend most time trying to analyse your actions. Parts of the analysis should include analysing your feelings; also, major things that are going on in your life outside trading. The more you are aware of those issues (and write about them preferably in your diary), the less control they will have over your life and your trading as a result.
Step 6– Determine what could go wrong in the beginning of every trading day. Make it like your early morning ritual. Try to think in terms of what could go wrong and how you will react to that. Like an athlete, your role is to do an extensive mental rehearsal and try to see all different scenarios. This will greatly improve your performance over time and could even place the line between losing and winning. Do this every morning before you start your trading day.
Step 7– The last step in my opinion should be a recap. After every trading session you should be doing a daily debriefing. Ask yourself the question: Did I follow my rules? If your answer is yes, pat yourself on the back. If you lost money, but you still followed your rules, pat yourself on the back. It is better to lose money on some days following your rules than make money breaking them. The point here is to be consistent and consistency is reached through persistence and great discipline.
So, traders… keep improving and don’t let the bad days change your goal. It is important to know where to stop and always remember that the best opportunities are the ones that you wait most for them.
Source: www.colibritrader.com
