How To Be A Profitable Trader
We cannot guarantee you 100% that everyone will become profitable trader.
Some people will become profitable traders.
Some people might not become profitable traders.
Based on our learning and studying, past mistakes, past successes, and real-time experience, we can say that, there are three things you need to master, in order to become a profitable trader.
- Consistent Strategy
- Proper Money Management
- Proper Emotion Management
If Success in Forex Trading Equals 100%
- 1% comes from consistent strategy
- 15% comes from self-discipline in money management
- 80% comes from mindset of emotion management
Success 100% = Strategy 1% + Money Management 19% + Emotion Management 80%
Success 100% = Strategy 1% + Self-Discipline 19% + Mindset 80%
Please remember the above 3 things in the success formula.
What Is Consistent Strategy? The 1%
Consistent Strategy is a set of steps:
- what time to trade (www.forexmarkethours.com/markethours.php)
- when to enter the market
- when to avoid entering the market
- when to exist from the market
- when to hold the position
- when to cut the position
- which economic to watch (www.forexfactory.com/calendar.php)
After you master any strategy, and it brings you consistent profit, you become a skillful trader.
(Talk to us, for an appointment and presentation, our team will guide you, and show you three strategies, in step-by-step presentation.)
What Is Proper Money Management? The 19%
Proper Money Management is a set of self-disciplined rules:
- Never use necessary money (or important saving) to trade.
- If that saving is for buying house or car, use it for buying house or car. Don’t use it to trade in Forex Market.
- If you have debt, pay the debt first. Don’t use the money for paying debt to trade in Forex Market.
- Never enter too big. Never enter more than 10% of capital.
- Never risk too big. Never risk more than 3% per trade.
- Never enter the trade, if you feel doubtful or unclear. No clear signal = No trade.
- Calculate your risk first, before you enter the trade.
- Enter the trade, only when you are confident.
- Enter with maximum 10% of capital per trade.
- Risk maximum 3% per trade.
- Record your trading transaction in Daily Forex Trading Journal. (Click the link to download it.)
What Is Proper Emotion Management? The 80%
Proper Emotion Management is the psychology or mindset of successful traders.
There are 4 emotions you must keep in control, if you want to become a profitable trader.
Greed and How To Control Greed
- Greed means you trade too big and trade too often.
- What is the worst case with greed?
- If you trade in greedy mode, you might lose all your capital in a few trades, within few minutes, or in a day.
- You can control your greed by following the rule of entering at maximum 10% of your capital per trade, and never risk more than 3% per trade.
Fear and How To Control Fear
- Fear means you take profit too quickly, you don’t let the profit ride far more.
- You fear that the price may reverse your direction and hit stop loss
- What is the worst case with fear?
- You make too little profit.
- You can control your fear by trailing your SL (stop loss) to EP (entry price) and letting the profit ride as far as it can.
Hope and How To Control Hope
- Hope means you hold the losing position longer and longer without having SL (stop loss), and you wishfully hope it get back to your direction.
- What is the worst case with hope.
- If you trade in hopeful mode, you might lose all your capital.
- You can control hope by setting SL (stop loss) and TP (take profit), and let the market go its way.
Revenge and How To Control Revenge
- Revenge means when you already lost one trade, you entered another trade, and when you were holding loss of another trade, you enter another new trade.
- What is the worst case with revenge.
- If you trade in revengeful mode, you might lose all your capital in few trade, within few minutes or hours.
- You can control revenge by losing only one trade, and then, waiting another day to trade.
Summary of How To Be A Profitable Trader
- Register demo account, install the software, and get familiar with Meta Trader 4, trading platform.
- Study the strategy, follow the strategy, soon, you will become a skillful trader.
- Have self-discipline in money management. Never risk more than 3% per trade. Never enter when you are doubtful.
- Develop the psychology or mindset of successful trader, by following the emotion management rule.
- When you maintain self-discipline and keep the mindset of success, you become a responsible trader.