Foreign exchange trading has become popular as more and more people turn to the financial market for active or passive income. Getting started in trading is extremely easy because all you need to do is register on a trading platform and press the ‘buy’ or ‘sell’ button. Succeeding as a trader, however, is a different ball game.
Most social media influencers and marketers never reveal the cold hard truths about trading. They ignore the struggles, difficulties, and realities of trading and promise quick gains in a short time and with little to no effort. This perception misleads new traders and investors who are oblivious to the nature of trading.
If you need to learn the truth about financial trading and investment, then keep reading this article to the end.
1 Trading is Simple But Not Easy
Forex trading is very simple. All you need is to learn a trading strategy and click the ‘buy’ or ‘sell’ button. But, it’s not easy because you need to spend time learning a profitable system, then spend even more time practicing, fine-tuning, and personalizing it. This could take up to a year or more, depending on the trader and the strategy being learned. Furthermore, trading psychology usually takes more time to develop. This stage of development is where most traders give up because even with the best strategy.
Sure, all you need to execute trades is to click buttons on your trading platform. But, clicking the right button at the right time takes a lot of hard work and consistent practice.
2 Forex Trading is a Business, Not a Hobby
Forex trading is a business, and those who treat it as such are more likely to succeed. Forex trading is actually a full-time business and one that can genuinely make someone rich. Even if you’re a beginner trader, you must still look at Forex trading as you’d look at your traditional business or job. Most successful traders take their trading processes seriously and devote time to improving their results.
For instance, if you have a daytime job, you will do your best to show up daily and perform all that’s required of you. That same attention and discipline should be evident in your attitude towards your growth as a trader.
Show up when you should, follow your plan, and practice as much as possible.
3 Trading Is a Numbers Game
Contrary to popular belief, the most crucial part of a trade is not the outcome but the execution and management. Professional traders find trade setups in line with their trading strategies and execute trades without worrying about the result of each individual transaction. This is because a profitable strategy can mitigate losses with time. Therefore, every win brings you closer to the next loss, and every loss brings you closer to the next winning trade. The goal is to trade without hesitation whenever your trading criteria are met.
4 Becoming Successful is a Personal Journey
Every trader in the world is unique, and you need to find out what style of trading suits you. A group of traders who simultaneously start learning the same strategy would become consistently profitable at different times. This is because a lot of personal and psychological factors influence the results they would obtain. Don’t be distracted by other people’s journeys, and make sure you focus on your goals. Don’t compare yourself to others but try to learn and adopt the habits and characteristics of successful traders.
5 Psychology is Just as Important as Market Analysis
If two forex traders use the same strategy, their results would vary depending on many factors, but primarily because of the difference in trading mindset; trading psychology. Trading psychology represents various aspects of an individual’s character and behaviors that influence their trading actions. How you think about trading influences your engagement with the forex market and your ability to maximize your strategy. Having a good plan is great, but a solid psychology is even better.
Finally, learning to trade requires you to adopt a long-term mindset and the willingness to get through the mental hurdles most traders face. You can take a trading course and learn from a mentor to ease your journey. Make sure that whoever you are learning from has enough trading experience with a verifiable track record of profitable results.
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