The Attribute of a Successful Trader

Written by K T

On May 12, 2020

Time and time again I will be asked some variation or another of this question. Sometimes it’s worded as, “What do you think helped make you successful?” and other times it might be, “Do you think I have what it takes to be successful?”

When we look at those before us who have done well in something we also wish to pursue, we all want to hear something that will assure us that we also have what it takes to reach that same level of success. Not only that, but we also hope to hear some glimmer of advice that can help give us “a leg up” on the competition.

When it comes to #trading, however, we tend to be our own competition. It doesn’t matter what the guy at the desk next to you is trading or what the lady on the other side of the world is trading. The only thing that matters is you. And when I’m asked what attributes make a trader successful, I can think of a number of things that will contribute to one’s success. However, when I’m asked to name just one, then the one that stands out in my mind is “fearlessness.”

I strongly believe that anyone can learn technical analysis and that anyone can learn a technical system of trading. I’ve been teaching market analysis myself for nearly as long as I’ve been trading. While everyone I’ve worked with individually over time has become an excellent market analyst, not all of them have found lasting success as a trader.

They knew what to look for and how to find it. They knew exactly what to do once they found it and how to manage it once they were in it. But, when the moment came to make the big decision of getting in or getting out of a trade, they froze.

This is something to which every trader I’ve met can relate. We’ve all had it happen. We’ve all second-guessed ourselves, hesitated too long, missed trades, missed exit triggers, or even paused and blew our stops. Every single one of these actions results from fear, or… to phrase it a bit differently… a lack of confidence. Without confidence, or fearlessness, we are like the deer frozen in the headlights.

Just as every person who enters into the markets can learn a system of analysis that will result in long-lasting results, I strongly believe that every trader can develop this fearlessness and build their confidence, whether it comes naturally to them or not. Not everyone, however, has the luxury to do so.

In order to develop enough confidence in your skills, you have to have ample time, the finances to sustain you as you learn, and even the discipline to actually follow through on the steps necessary to develop that fearlessness… such as consistently keeping a journal of your trades and taking the time to analyze them regularly.

When I was a child, I was incredibly shy. Although I’d climb to the top of the tallest tree without the least bit of hesitation, my fearlessness was contained within the bubble of my own little neighborhood where the faces and situations I’d find myself in rarely changed. Whenever I was removed from that comfort zone, I was at a complete loss. As with any child growing up, however, over time I became more and more exposed to “the real world” and gradually started to come out of my shell. Before long, I started to purposefully put myself into situations where I was forced to face my fears head-on. I joined the drama club, started taking classes in neighboring cities, and even helped organize a youth group.  That shyness still pops up from time to time, but overall you could say I’m pretty fearless when thrown into new and unexpected situations.

Did that fearlessness come naturally? Not at first. To begin with, I had to deal with new situations just as a part of growing up, but then I took that a step further and I pursued new experiences despite still having that fear sitting in my stomach. When fear resulting from shyness is replaced by a fear that causes you to hesitate in a trade, you basically have to take the same approach I did. Sometimes you just have to force things before they start to come “naturally.”

“Never force a trade!” Ok, true… we’ve all heard this. But, sometimes you have to ignore some of the most popular adages in the market, or at least the literal interpretation. It is one thing to force a trade when there really isn’t a lot in its favor technically, and it’s another thing to force a trade when you see the technical reasons to support it, but still struggle to pull the trigger.

So what do you do? Pull it anyway. Trade smaller size, use micro or mini contracts, trade a few shares at a time, etc. Just do whatever you have to in order to reduce your risk to mitigate fear, but still take the trade. After all, I had to first join the drama club, doing small skits before working up to being on stage in front of thousands. Over time you can build your own size in your positions. But first, become fearless!

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