It is a very common misbelief that trading is the easiest way to earn quick money. Well, ask the experts and some say that it is the simplest way to lose money if not done with proper research and planning. A very old Wall Street saying is that “the easiest way of making a small fortune in the markets is having a large fortune", and this means that trading is not for the weak hearted.
There are no hard and fast rules to get successful in trading. Trading again is not for everyone; while some find it easy whereas others feel that they cannot. Those who trade are not always successful and it is not just one characteristic that makes them successful. The best stock traders in India who have made the most in the least time have some common characteristics and let us now understand what the common baskets of traits are.
A Successful Trader should make sure to:
1. Have a Trading Plan and Do Homework: Traders who always win spend hours of their time in market analysis. They maintain charts and update their notebooks with the strategies they need to implement the next trading day. Such traders have a better understanding of the current trends of the market and identify the strongest sectors and the strongest stocks from such sectors. They know the level they would enter and the approximate target they have for that particular position. Good traders who have good technical knowledge do not worry about the flow of the news but instead go with the flow of the market.
2. Avoid Over Trading: Over trading is one of the biggest mistakes traders make. A trader who is disciplined trades light when the markets are choppy and does not trade at times when no prospective trades are on the horizon.
3. Never Get Unnerved Due To Losses: A trader who is successful is cautious and he uses money management techniques. Traders should always take the losses in their stride and then try to analyze as to why the markets have moved against them. One can learn good trading lessons from those trades that have given a loss.
4. Discipline: Discipline is a must to climb any success ladder. Traders who follow discipline while doing research, sticking to a strategy, setting goals and making an exit are often successful.
5. Humility: One needs to understand that humility is different from stubbornness. Traders need to admit when they are wrong and never indulge in their own ego when trading.
6. Patience: It is often said and seldom followed; patience is a must for every trader. Successful traders wait for the right opportunity to make an entry. One might come across traders who just sit idle and watch the markets, but they are actually waiting for the perfect time to enter a trade or make their exit.
7. Have a Unique Trading Personality: One’s trading should reflect his/ her personality. One should be able to trade out of their comfort zones and hence it is important for traders to have their own unique style of trading to get successful.
8. Be Able to Separate Fake News from Reality: Successful traders are not influenced by the news hype and they make their own personal decisions to reach their own targets.
9. Trade to Live: A successful trader often tries to earn money using strategies that are of a low risk. When trading, one always needs to remember that no matter how confident one feels about the trade, there are times when the markets do not cooperate. Traders learn to trade using the low-risk strategies which will earn them lower returns that are consistent.
10.Always Have a Cushion: A successful trader understands that when the markets can give good profits, there would be days when one can expect losses. New traders often plan to invest all their money in markets when they start earning profits. One should remember not to invest a certain amount of money in the markets. While trading you must ensure to have enough cushion, which will come to your aid when you fall.
Always do remember that there are no specific rules to become a best stock trader. One needs to know when to make an entry and if you are unable to pull that trigger at the right time, all the knowledge and the analysis goes waste.