TRADING PSYCHOLOGY
No Pain, No GainThe Wounded Trader
by Adrienne Laris Toghraie
Don't let your past affect your present performance in the markets.The business of trading forces you to face the psychological baggage that you carry. It also makes you deal with new issues that develop from losses in the markets. Hard-earned money and dreams lost can leave deep psychological wounds. The prevention of such wounds, and the way you handle them when they do happen, will determine whether you will survive as a professional trader.
READY TO RUMBLE
If you want to become a profitable entrepreneur, you must prepare yourself by getting some education and a business plan. This is a time-consuming and costly process. Look at doctors, lawyers, and storefront business owners. For each career, money is required to provide for years of education, and then additional capital is needed to maintain the business and a comfortable lifestyle through the start-up phase of the venture.
The same requirements apply to trading. To become a trader, it is important to realize and prepare for the fact that most traders are not profitable in their first year. Early planning for the equipment and trading capital is important for eventual success. Most traders enter the trading business undercapitalized, undereducated, and underprepared for contingencies. This lack of preparation creates an emotional war zone from the very beginning of the venture.
...Continued in the April issue of Technical Analysis of STOCKS & COMMODITIES
Excerpted from an article originally published in the April 2004 issue of Technical Analysis of STOCKS & COMMODITIES magazine. All rights reserved. © Copyright 2004, Technical Analysis, Inc.
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