You probably already know that emotions and trading don’t go well together. By being emotional you decrease your chances of success, putting a strain on your trading strategy, and run the risk of losing more than you earn. In today’s article you will find 5 tips on how to boost your self-discipline, that can help you start trading in a calm, rational fashion.
Discipline, not money
It may sound ridiculous yet the first thing to do when entering the world of trading is forget about the money. How is that possible, you may ask? Isn’t trading all about money? Both yes and no. The end goal of each trader is to accumulate as much wealth as possible by the means of speculation. However, in order to get to the end goal, you have to concentrate on things that make money, not the money itself. Start thinking in terms of strategies and trading plans, and, if you do everything right, the money will come.
Someone is watching
Here is another trick you might want to use. It works for experienced and novice traders alike. And the best thing? It is really easy to apply. If you have heard about famous traders, imagine the one you respect the most. If not, go do some research on famous traders and pick any. The trick is to learn something about his personality, trading style and accomplishments. Familiarize yourself with this man.
Now, to the second step. Imagine that when you trade, this man is standing behind you. Every deal you open, every dollar you invest — this man can see everything, and he can judge you. This will not only boost your discipline but also decrease the time you are distracted.
Make a list
Write down everything that is — in one way or another — related to your trading activities. What assets do you trade? When do you trade them? Why do you trade? Come up with a list of particular, easy to define goals and a timeline to achieve them. Print all this information (should be up to one page maximum) and hang it where you can see it while trading. When in doubt, take a glance at the document to remind yourself of the bigger picture. Having a well-defined strategy and goals can help you stay one step ahead of other traders.
One day rule
Promise yourself to stay disciplined for one day only. ‘Today I will abide by the rules I’ve come up with and won’t succumb to emotional trading’. That’s all it takes. It is the same trick most artists use. When they feel down and not able to practice, they tell themselves to sit down and draw one straight line. When you are good and ready to practice, it, of course, won’t be the only line. After the first line comes the second, then you find yourself dedicating several hours. Stay disciplined for one day only, but every day. Soon you will find that it is much easier to maintain discipline and that it is becoming your second nature.
Stay calm
Remember that discipline is your friend, not the enemy. Although it doesn’t seem like a lot of fun, it can save you a lot of time and money in the long run. Discipline is also what sets professional traders from first-timers. By learning how to stay disciplined in the very beginning you will find it much easier to abide by the rules later.
Do you use any tricks that help you stay disciplined? Share them in the comment section.
