Trading is a Small Business

The common knowledge is that most small businesses fail. They fail rapidly, and fail spectacularly. Trading is also a small business. The knowledge that most new traders do not survive the year is not a comforting fact. Many innocent people are lured by the seduction of the market. The majority of people who enter start trading have been successful in their careers, and professions. This counts for nothing in the world of trading. Your previous accomplishments in the professional have no effect on your performance in the trading arena if you are not realistic about the challenges you have to face.

Why are most professionals failing at trading? First of all, many people believe that you can grow their equity of $10 to thousands of dollars over a few months. Statistically, the odds of anybody succeeding are very small.  Only 10% of traders make money. The remaining 90% of people will lose all or most of their money eventually. What makes you so special that you think you are that tiny percentage of winners? Luck? No. You need to give yourself a fighting chance, by arming yourself with knowledge, and discipline in order to gain the edge over your competitors.

A trader’s psychological health and risk strategy marks them above the rest. Listening to the Dow Jones Report is important, but what is more important is your thought process, and discipline.  In order to succeed, you need to put in the hard work, be dedicated, make time to learn, employ risk management, have fundamental knowledge, and control of your emotions. You cannot make millions without these attributes. Sure, you may get lucky and make some money in the short term, but the market will eventually catch up, and eat up all your profits. The long term successful traders embrace dedication, and discipline.

Every time you place a trade, you need to employ risk management. For every single trade, you must control your emotions. It only takes one bad trade, where you ignore your risk management strategy, to lose all your equity.