Trading Like a Business
One thing traders fail to do, besides proper money management, besides managing their mental state, besides preparing for their trading day (wait, that is a lot of things)…it would be they fail to treat their Trading Like A Business.
And make no mistake about it - this is a business, and one that needs to be taken seriously. The effort you put into your business will have a direct correlation to what you get out of it. Failing to put the work in only reduces your chance to be successful. And considering the possibility of what can be accomplished through trading, why would you not give it 110%?
This does not mean 110% of your efforts go into study or chart time. That is important, but you have to train in all areas to be a complete athlete, and the same goes for trading. You will never see a professional basketball player who only practices shooting.
They exercise, practice free throws, watch tape of opposing teams and themselves, do footwork drills, lift weights, etc. The list goes on, and you can always tell the difference between a professional, and wanna-be by how they prepare for game time.
For you, game time is when you are sitting in front of the charts, it’s time to trade, you have your charts up, your platform running and you are ready to trade. But what actually determines your success is not what happens in those moments, but of what happens prior to your trading day.
How well did you sleep the night before? Did you drink alcohol before going to bed? Exercise before you started trading? Do your daily preparations listed in the prior video? Or just wake up, turn on the computer, and start trading? Ask yourself which puts you in prime mental shape to make the best decisions, and then ask yourself why you would not prepare like that every day to be in top shape for trading.
Trading is a business and one that needs to be treated like one.
Below are some tips you can do to make sure you treat your trading like a business;
Make sure you are in a quiet environment so you can concentrate fully
Turn off your email, phone, log out of facebook and all social media accounts. Studies have shown any sort of distraction, just even checking facebook once can reduce testing performance dramatically. Why risk money just to see if someone liked your facebook post?
Have a Trading Journal and Fill It Out Regularly
There are some professional poker players that have entire rooms full of notebooks they’ve taken on players they went up against – how they bet, when they bluffed, what they held in key hands, how aggressive or tight they were. This information is their edge the next time they play someone.
Your edge in information is what are your tendencies, what mistakes you tend to make, what systems you work best with, what pairs you work best with, what style of trading works best for you. This is your edge so fill out your trading journal after each trade. You will find out things about yourself that you never imagined were the problem. Sometimes fixing one or two habits will help you turn the corner.
Also make sure to put images in your workspace which inspire you towards your goals. Maybe it is a picture of a beautiful house, or a vacation spot you always wanted to go to, or something which makes you think of working hard and making money to get to. These little reminders will be positive triggers which inspire you to take your work to the next level and constantly improve towards your goals. One trader I knew actually put tape on the floor all around his desk/trading space. Basically, that was his zone. Once he entered it, it was game time. This was a clever trigger he used to train his mind to enter a different space so he was totally focused on trading.
Like all saavy investors, they want to know if you have a plan, whether it be a business plan, trading plan, or whatever. You will need a trading plan. The problem is, as your still learning how to trade, you’ll likely not be able to fully create a plan based on limited data.
The most important details to include in your trading plan are;
-What pairs/instruments you trade
-What systems you trade (include time frames)
-What is your risk management profile / money management rules
1) Have Backup Plans Ready
Ask yourself this, ‘What happens if my computer or internet goes down?’
Do you have a backup plan to manage your trades should this occur while live trades are active?
Mobil Phone access to live trading account
Dealing Desks phone number.
These are the most important things you can have on your trading plan. You can include additional details like sessions you trade, days to avoid trading, etc. But these are the most important.
In Conclusion
Preparation creates the seeds for success in whatever you do. Those who treat their trading like a profession and a business don’t start the trading day the moment they turn on the computer.
And make no mistake about it - this is a business, and one that needs to be taken seriously. The effort you put into your business will have a direct correlation to what you get out of it. Failing to put the work in only reduces your chance to be successful. And considering the possibility of what can be accomplished through trading, why would you not give it 110%?
This does not mean 110% of your efforts go into study or chart time. That is important, but you have to train in all areas to be a complete athlete, and the same goes for trading. You will never see a professional basketball player who only practices shooting.
They exercise, practice free throws, watch tape of opposing teams and themselves, do footwork drills, lift weights, etc. The list goes on, and you can always tell the difference between a professional, and wanna-be by how they prepare for game time.
For you, game time is when you are sitting in front of the charts, it’s time to trade, you have your charts up, your platform running and you are ready to trade. But what actually determines your success is not what happens in those moments, but of what happens prior to your trading day.
How well did you sleep the night before? Did you drink alcohol before going to bed? Exercise before you started trading? Do your daily preparations listed in the prior video? Or just wake up, turn on the computer, and start trading? Ask yourself which puts you in prime mental shape to make the best decisions, and then ask yourself why you would not prepare like that every day to be in top shape for trading.
Trading is a business and one that needs to be treated like one.
Below are some tips you can do to make sure you treat your trading like a business;
Make sure you are in a quiet environment so you can concentrate fully
Turn off your email, phone, log out of facebook and all social media accounts. Studies have shown any sort of distraction, just even checking facebook once can reduce testing performance dramatically. Why risk money just to see if someone liked your facebook post?
Have a Trading Journal and Fill It Out Regularly
There are some professional poker players that have entire rooms full of notebooks they’ve taken on players they went up against – how they bet, when they bluffed, what they held in key hands, how aggressive or tight they were. This information is their edge the next time they play someone.
Your edge in information is what are your tendencies, what mistakes you tend to make, what systems you work best with, what pairs you work best with, what style of trading works best for you. This is your edge so fill out your trading journal after each trade. You will find out things about yourself that you never imagined were the problem. Sometimes fixing one or two habits will help you turn the corner.
Also make sure to put images in your workspace which inspire you towards your goals. Maybe it is a picture of a beautiful house, or a vacation spot you always wanted to go to, or something which makes you think of working hard and making money to get to. These little reminders will be positive triggers which inspire you to take your work to the next level and constantly improve towards your goals. One trader I knew actually put tape on the floor all around his desk/trading space. Basically, that was his zone. Once he entered it, it was game time. This was a clever trigger he used to train his mind to enter a different space so he was totally focused on trading.
Like all saavy investors, they want to know if you have a plan, whether it be a business plan, trading plan, or whatever. You will need a trading plan. The problem is, as your still learning how to trade, you’ll likely not be able to fully create a plan based on limited data.
The most important details to include in your trading plan are;
-What pairs/instruments you trade
-What systems you trade (include time frames)
-What is your risk management profile / money management rules
1) Have Backup Plans Ready
Ask yourself this, ‘What happens if my computer or internet goes down?’
Do you have a backup plan to manage your trades should this occur while live trades are active?
Mobil Phone access to live trading account
Dealing Desks phone number.
These are the most important things you can have on your trading plan. You can include additional details like sessions you trade, days to avoid trading, etc. But these are the most important.
In Conclusion
Preparation creates the seeds for success in whatever you do. Those who treat their trading like a profession and a business don’t start the trading day the moment they turn on the computer.
