The Characteristics of a Successful Day Trader
In theory, anyone could become a Formula race car driver, but in reality, very few people have the right training or posses the right temperament for such a demanding sport. The same is true for day trading. Day traders should make sure they have the right training, have certain personality traits and have access to certain resources if they’re to be successful.
These are the essentials.
- Knowledge and experience in the markets– Day traders must have an understanding of market fundamentals if they’re going to succeed. Most have many years of experience investing and trading in the various markets. They also research constantly, using services provided through a full-service online brokerage account or information from publications like the Wall Street Journal, to gauge market sentiment.
- Capital– “It takes money to make money” is a cliche that resonates with day traders. That’s because they often borrow money — called leverage — to use in the market. While this is risky, it’s absolutely necessary. Using a large amount of capital to make many smaller trades increases potential returns.
- A business plan– Day trading is a business and, as such, requires a business plan. Most plans address short- and long-term goals, target markets, trading hours and days, business setup needs, capital reinvestment,tax considerations, reporting and metrics.
- A Safe Day Trading System – a day trading system with comprehensive evaluation & instruction, helps traders convert day trading frustration and inconsistency into predictable profits. Without a proven system your chances of long term success is nil.
- Discipline– Day traders separate themselves from their emotions and never act impulsively. They always work with risk capital (which is money they can afford to lose), they use stop and limit orders to reduce losses, and they always close out at the end of the day.
- Technology– Day trading functions through electronic communication networks. A trader accesses these networks using a computer and a high-speed connection. A typical setup might include two monitors working off one PC, cable broadband or DSL or satellite internet connection, and a wireless router for a laptop.
- A Broker Platform: There are many platforms available with many different levels of features. Many day traders use analytical software to search for trades, receive information, execute trades and manage accounts.
People who attempt to trade without proper training or resources are very likely to fail, and many do. Those that succeed encounter a definite learning curve. Once they gain experience, traders often take up day trading professionally, either as part of a larger institution or as lone rangers. Institutional day traders work shoulder-to-shoulder with other traders in large, computer-laden trading rooms. Individual day traders work from their homes or offices.
Either way, once you master your Safe Day Trading system it’s a fantastic profession. Part-time day trading is possible. Those who adopt a part-time approach still treat their trading as a business. They set a schedule — and follow it religiously. This discipline distinguishes them from hobbyists or those who experiment with day trading as a form of gambling.
But know this, many successful gamblers have made significant sums of money day trading the market. The reason: they apply the same mentality of following the rules and stay disciplined to the system.
Your Secret Formula for Day Trading Success:
Training from Safe Day Trading + Practice + Discipline to follow the rules + Belief + Action = $uccess!!!