By: Gaurav Taneja, Financial Trainer, Venteskraft May 22, 2020
A winner trader mindset is flexible. The flexible traders have a more carefree attitude when it comes to executing a trade. They have their trade plan ready and when the conditions and proper market is met they execute their trade without overthinking about the strategies. They don’t over complicate things, they try to keep the things simple. And when they get a profit they accept it and move on to the next trade. Indeed they move on even after a trade goes wrong. Ultimately they know in order to be a successful trader they need to execute trade after trade. The more flexible you can be, the more likely you’ll be able to be consistent.
Cultivating a carefree mindset is important, but it is hard to do under some circumstances. For example, if you have a small capital or the last hard earned money left then it is reasonable to be afraid about losing it all. You will deep down know that you can’t afford to lose. It is essential that you use the money that you can afford to lose and use proper risk management. If you know that in any one trade you have relatively less to lose, and at the worst-case scenario if the loss happens you can recover from it, you will much easily focus on the learning process.
That said sometimes people are rigid and inflexible when it comes to their personality. Most of the time they are not to be blamed because all of this is rooted in early childhood. The way their parents treat the child and act as harsh critics, is also responsible for such upbringing. They give out this message by their actions, ”If you make a mistake, the consequences won’t be good.” So these people on growing make a habit of ignoring any kind of mistake, even when things are not under their control. It is certainly important to take precautions in life, for example when you are driving, you should be aware of the speed limit and the turns. But when it comes to trading, there isn’t much you can do most of the time.
You should be aware of the price hikes, earnings reports, or national events, but most of the time the markets are unpredictable. You must accept what the markets have to offer. You can’t impose what you want. Stock Market doesn’t work like that. So you should simply have a carefree attitude. It is impossible to find a reason for every single factor that goes against you. So it is best to just put on the trade and find out what happens. Inflexible traders have a hard time adapting to it. They think they can completely control the market.
If you have missed on the “Market Psychology” series, read it here.