What You Need To Know First
The reason for the lack of success is simply that most traders have not taken the time to understand what works in the stock market and what accounts for super-performance.
Among those who obtain the needed knowledge, many fail to develop the emotional discipline to implement a winning plan.
Achieving super performance in stocks does not depend on luck or circumstance. It is accomplished through proficiency, endurance, and talent, which is developed over time through commitment and hard work. If you have these qualities, the likelihood is that you will succeed.
There are technological developments along the way, and some techniques work better than others during certain periods. However, stocks still rise and fall for the same basic reasons as they did before: people drive stock prices and they are emotionally the same. Moreover, history repeats itself over and over.
The road to success in the stock market is not a structure or technique. It is within you and will be discovered only to the extent that you are able to control your emotions as you face challenges.
Learn to do your own research because it is far superior to outside research or tips. Do the work, take responsibility for your failures, and you will own your success.
To acquire handsome returns from the market, you have to separate trading from your ego. Making money is more important than being right.
Most investors practice incorrectly and refuse to objectively analyze their results to find out where their approach is going wrong. They forget the losses and keep doing what they’ve always done. Practicing correctly is what's important.
Paper trading is the wrong kind of practice. It does not prepare you for the real punch of the market. It also does not prepare you to handle financial and emotional pressure. Hence, it will be unlikely for you to make the same decisions as your practice sessions. It creates a false sense of security and hinders your learning process.
Novice traders should trade with real money as soon as possible. It is a good way to gain experience by trading with an amount that is small enough to lose but large enough to be painful.
Applying traditional wisdom generates conventional returns, not super performance.
As you examine and evaluate the market, be willing to do things that most people won’t do. Growth comes at the cost of comfort. Learn to experiment outside your comfort zone and always question conventional knowledge. If you wish to be extraordinary, you must be unconventional.
Define your trading, whether trading suits your personality or long term investment approach. If you fail to do so, you will experience inner conflict at key decision-making times.
The key is to focus on a particular method, which means sacrificing other techniques. Once you define your style and objectives, it becomes easier to stick to a plan and achieve success.
Celebrate, be happy and appreciate when you win. Don’t look back at failures with regret. The past cannot be altered, only learned from. Most importantly, never let bad days make you give up.
