I am convinced that one of the elements of successful trading is passion for the activity. I just got back from speaking at Traders Expo in New York and realize that whenever I attend an event like that I come back really pumped up about trading all over again. I am happy to report that my speech was very well attended (standing room only) and apparently well received since I was mobbed afterwards with requests about where the attendees could get "Trade Your Way to Wealth" (amazon.com).
Many of the presentations I attended were nothing short of excellent and I always come away with something valuable. One of the speakers was a well known trading coach who related many positive experiences with successful students but who does not trade herself. One of the attendees asked why she didn't trade herself if she was so good at it. Her answer was that it was not her passion. Her passion is helping traders get even better and she is well paid ($7,500 for a two day private session). Though she is a good trader she just doesn't enjoy it as much as she enjoys the coaching.
Tenacity and persistence were concepts frequently advanced as qualities of good traders. In my mind, a trader is unlikely to have either unless they are also passionate about their trading. Interestingly, the point was made again, as I have often preached, that good traders get their own education. They go out and get the books and do the reading and attend the classes and get the coaching because they want to learn.
Nearly every speaker advocated the need for a plan and for discipline in trading. One speaker was even selling the template for a plan for $120. (I include the ingredients for your own plan in "Trade Your Way to Wealth" at no extra charge, but the point, of course, is to have a plan). The old saying is: "plan your trade and trade your plan." Passion to succeed leads the good traders to follow that mantra.
Another exceptional speaker, Dr. Ari Kiev, a psychiatrist, advanced the importance of setting a goal. Those who set a goal have a much better chance of achieving success in their trading than those who don't. I suspect the efforts to attain the goal also serve to fuel the passion for trading and the passion, in turn, helps achieve the goal. Pretty nice circle to ride around, I'd say.
In my view, it all begins (and maybe ends well) with self-education and, without the passion, it seems that no one is likely to expend the effort necessary to get the education. I suspect that you, the reader, already do have some passion about trading or you would not have bothered to read this article in the first place. My best advice is to follow your passion, whether it be trading or something else. If you do, your chances of success are great.
On a related subject, I intend to write more over the next weeks concerning picking stocks and entries and exits. In order to do that, I expect I will include some articles on at least basic technical analysis. Technical analysis is not as mystical as some fear and it does provide a great method to discipline trades and money management as well as suggest entries and exits.
by Bill Kraft, Editor
Copyright 2008, Makin' Hay, Inc.
All Rights Reserved
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