The 6 Main Reasons Not To Give Up Trading

Trading

The 6 Main Reasons Not To Give Up Trading

door aug 18, 2015Trading

Trading is hard. Only few of the people that start with trading make it through the end. You are going to want to give up. After taking your next big loss because you have no idea what your doing. You may even be blowing up your third or fourth account. Probably you don’t follow your own rules. It will get stressful. You are going to want to quit. A lot of times. So why would you even bother to get started?
Is it just because you read the stories of the few people who build great wealth in the stock market? Do you hope you can replicate that kind of success in just a few weeks or months?
 
Hopefully you’re smarter than that. It is nonsense to think that you can learn trading in a short period of time.
 
There is so much more involved in trading that you must really put in the time and dedication to learn and grow yourself. It is going to cost you a lot of time to put into it. And probably it is going to cost you a lot of money too.
 
Before you’re ever going to be consistently profitable. Consistently is the key word here.
 
Off course you’ll get lucky a few times and have some nice profits.
 
Maybe even so lucky that in the first row of trades you only make money. By betting big you might even make big money as well.
 
But are you using a plan to make you money, or is it just beginners luck?
 
If you’re making profits without a well thought strategy your luck can change instantly and you wipe out all your profits. And the rest of your account as well.
 
As trading is such a hard business to be in, why should you even want to continue pushing yourself to try to become good at it?
 
Because trading will make you better.
 
You’ll grow as a person and become more valuable to yourself, but also to the people around you. Not because you might make money and can pay their bills.
 
But because you’ll learn so much about yourself on your journey to becoming a successful trader.
 
Let me go over 6 of the main reasons why you should not stop your trading journey.
 

Learning about your emotions

DV0EKCTSGSYou’ll learn about how emotional you can react. Even if you’ve always thought of yourself as a very rational person.
 
When your money is on the table you tend to fall back into your emotions. And emotions are no good advice givers for traders.
 
You need to learn how to handle your emotions. How you can still think rationally when in a stressful situation.
 
Yes, it is stressful when your position is showing you a big fat loss.
 
At that point you need to admit to yourself that your judgement was totally wrong.
 
The entry point was wrong. You missed your sell rules to cut your losses. You’ve waited and started hoping for a bounce.
 
And we all know, hope is not a strategy.
 
So you’re at the point where you must admit to yourself that all your judgement has been completely wrong, and you are going to pay for it as well.
 
That hurts. It is important to recognize when you’re wrong and immediately take action.
 
Don’t let it go against you any more. Just cut it off.
 
Yes, your thesis might have been right. Yes, your research might have been thorough. Yes, your entry price was perfect.
 
But when the market is showing you something different you must not argue with it.
 
Don’t fight the market and accept your wrong-being. Even if is doesn’t make sense. You can research that later to find what you may have missed in your judgement.
 
Just don’t be stubborn and hope for a turnaround.
 
Learning to accept your wrong-being is one of the hardest thing a human can do. We have a lot of biases that always look for the small reason why we are right.
 
To become profitable in trading, you need to set that emotion aside. Admit that you’re wrong, take your loss and move on.
 

Become more disciplined

As said before it is very hard to become successful in trading. You need to put in a lot of hours into your education.
 
Whether you’re school-taught, or self-taught. It takes time to become known with the stock market.
 
Especially when you’re self-taught you’ll become so much more disciplined than you ever imagined.
 
You need to develop the discipline to learn about the market. To learn about different strategies, finding the strategy that fits your style.
 
Also the discipline to check in on the market on a daily bases to keep in sync with the market. And to find out how your positions are doing, and learn about possible new opportunities.
 
You need to have the discipline to make a trade plan for every single trade you’re going to make.
 
More importantly, you need the discipline to stick to your plan as well. 
 

Competitive in a level playing field

7683881689I love competition. I can’t be in a game where I don’t want to win.
 
Games where you play together to solve something are not my cup of tea. I need to have an opponent that I can compete with.
 
I like to outsmart others and find hacks to winning a game.
 
The opposite of wanting to be a winner is that there is always somebody on the losing side as well.
 
Lots of people can’t stand losing. It makes them feel bad and stupid.
 
Secretly I’m a very nice guy and don’t to make anybody feel bad.
 
The beauty of the stock market is that it is a very competitive world.
 
You don’t have a single competitor, but you have millions of people against you.
 
From small individual traders to long term investing hedge funds and high frequency trading firms that look for the smallest profits possible.
 
Do you even stand a change to compete against them? Yes you do!
 
That is the beauty of the market. There is not one winner. There can be millions of people winning.
 
And there doesn’t have to be a loser. The stock market is a level playing field. 
 
When I want to buy shares I don’t have to steal them from anyone. For every buyer there is a seller and vica versa.
 
If I decide to buy shares there is someone looking to sell them. We both get what we want if we manage to negotiate the right price. 
 
I only may be the quicker buyer for the current price than others. But I don’t have to make anyone feel bad by taking my desired position.
 
In fact I am even making somebody happy. The seller of the shares.
 

Work from anywhere

DSC01337Part of the freedom you get from being a stock trader is that you can work from anywhere you want.
 
As long as you pack your laptop with you and your destination does have an internet connection you are set. In the most remote places in the world there is WiFi nowadays.
 
We even had WiFi at the starting point in the middle of nowhere of our camel trip into the Sahara when we were in Morocco.
 
When we needed to get some more bottles of water to go with us on our trip we had to drive about an hour back to the last ’town’. 
 
With an internet connection and a laptop you can easily do your research online with all the different tools available.
 
Personally I use ThinkOrSwim as my main charting software. Just because I really love that application and it gives me all the options I need to do my technical analysis.
 
Luckily ThinkOrSwim has the best mobile app among stock brokers. So I can use that on my travels on my phone or tablet too. 
 
Besides that I keep several watchlists in my Stockcharts account as well. For me that is the easiest way of scanning through dozens of charts every day.
 
Since most of my charts are already online in stockcharts I wouldn’t even really need to bring my own laptop with me. 
 
You may choose to work from a home office where you’ve set up your trading room with several screen to stay in sync with the market.
 
Or if you love to travel around the world you pack your laptop, maybe an extra monitor, and leave the country.
 
It is mostly up to you to decide where you want to work
 

Work as much as you want

K1GVTNT1GJBesides being able to work from where you want, as a self-sufficient trader you also can decide how much you want to work.
 
You can choose how many hours of work you put into your days.
 
But wait..didn’t I earlier tell you that you need to put in many hours of studying to even become profitable?
 
And now I’m telling you you can decide how much time you want to spend?
 
That’s right.
 
In the beginning you’re going to need to spend every spare minute of your time studying charts, refining your strategy and doing your research.
 
Later on when  you’ve succeeded in becoming profitable you still need to spend a lot of time studying to stay in the game.
 
Although at this point you have the option to do it on a little slower pace.
 
I focus on swing trading from a couple of day to weeks and even months. Because I look at the longer timeframe I don’t have to be glued to my screen prepared to trigger my buy order just in time intra-day to make a profit.
 
By looking at a longer timeframe you eliminate all the intra-day noise and price changes.
 
Not having to worry about these smaller movements gives me the option to check in on the market only a few times a day.
 
Even only one time a day can be enough. And if you’ve placed your stop-loss orders correctly I might even not be looking at the market for a couple of days.
 
Most of the times I can’t resist the urge to check what is happening. And to keep searching for the next big winners.
 
But it gives me the freedom of not being worried about my positions every single minute the market is open.
 
I don’t want to go as far as Warren Buffett says by only buying stocks you don’t care to hold on even if the market is closed for a couple of years.
 
It certainly gives me another advantage for living my dream life.
 

Learn one of the most useful skills

metatrader-terminalThere are a lot of professions you can choose in your life. Most of them can get you a nice job and make you a good living.
 
Also there are jobs that can make you wealthy, although most of the really wealth people haven’t become that by working at a job.
 
The main downside of choosing a profession and getting used to be working at a job is that you are always depending on your employer.
 
When there is no employer willing to give you a job you won’t make any money.
 
Even when you’ve chosen the better option of becoming an entrepreneur so that you don’t need an employer, but can find your own work you’re still dependent.
 
In that case you’re depending on clients or customers to want to buy your products or services.
 
And there is no guarantee in the world that they’ll continue to buy from you in the long run. The beauty of the stock market is that it is here to stay.
 
There is not a thing in the world that could make the stock market disappear.
 
Companies will always exist, and they will always need to raise capital on the market to stay in business.
 
No matter what kind of businesses there need to be to give the public the stuff they want.
 
Whether it is an oil-company, a chain-store company, a tech company or some new futuristic market that is coming in the next decades.
 
The companies will keep coming to the market. And as long as there are companies that are traded there is an opportunity to make a profit.
 
If you are successful in trading you’ll always have the opportunity to generate a sustainable income for yourself. 
 

Never give up trading

Despite that the trading journey will be very hard. And you will reach point where you are going to want to give up.
 
Make sure you keep your goals in mind. Remember why you started and never quit because something becomes to hard.
 
Motivation-Picture-Quote-No-Quitting
 

What reason makes you think about giving up trading? Let me know and maybe I can help you overcome it!

 

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