Many traders believe that successful traders are born special. Great traders have inherited the “trading gene” or have a natural talent for trading. Nothing could be farther from the truth. Although it is a popular misconception, trading success has little to do with intelligence, personality makeup, family background, or other inherited characteristics. Scientists have studied what makes outstanding performers from the arts, business, medicine, and sport outstanding. What they have found may surprise you.
What Makes a Great Trader
Over the past 35 years, much research has gone into the question: What makes the extraordinary performer extraordinary? The answer consistently has been something other than natural talent. The results are always the same, natural talent is truly overrated.
What makes a great performer great includes the following three things:
Dedicated practice. Regardless of the field,those who make notable achievement spend time practicing their craft. Many traders underestimate the amount of time and practice needed; it clearly involves more than buying trading software and having a few trade setups. It requires a certain kind of practice. It is what scientists call deliberate practice or deep practice. It is a high quality and intensive practice that is sustained over many months and years.
A real secret to trading success is to develop a trade setup and then practice that setup in all kinds of market conditions. You can do this through simulation and bar-by-bar replay. Such practice gives a deep understanding of the trade setup and the market context in which it works best putting the trader on the road to achievement and success.
Training and coaching. Top performers in every field study their craft thoroughly. Most have a coach to helps them develop their skills. Traders, too, can benefit by careful study and working with coaches on both technical and mental skills.
Traders should select their training with care and make sure it meets their needs. As the research on deep practice is now becoming more available to the public, training that incorporates deliberate practice procedures are beginning to emerge. This is good news for traders as their study and training can be guided by what works well, according to scientific principles.
Support. All extraordinary performers have support from family and friends. Traders have a definite need for support. For most, trading is lonely. It helps not only to have family support, but also support from like-minded friends who trade. A trading buddy or two can provide valuable relationships.
Internet forums and trading clubs offer ways to connect with other traders. In the best of these trading communities you will find like-minded traders who are interested in learning and can help inspire one another.
Of the three elements that lead to success listed here it is the consistent, high-quality practice that is the most important to a trader’s development. Use a daily practice routine to acquire highly specialized trading knowledge, skills and abilities.