If you are interested in the world of trading and its history, you can probably name some well-known successful investors. Warren Buffett, George Soros, Benjamin Graham — all these names seem so distant: yes, they were successful, but what does this have to do with you? You may feel confused and even discouraged, not knowing where to start and what to do. But instead of giving in to this overwhelming feeling, read this article, learn what experienced and novice traders do and use this knowledge to enhance your strategies.
The success of the great investors is, without doubt, a phenomenal thing, but there are always similarities between successful people. What is it that they do right? What makes great investors so great and is there a secret they know that you do not? How can you use their success in your own strategies? Let’s break it down.
1) Successful people value education
Quality education starts from a young age, but it does not stop there. You need to continue learning throughout your entire life. When it comes to trading, and it has been said many times before, learning is the key. A mindful approach is not possible without a good knowledge base.
Successful investors always have a story to tell and it often involves a period in their lives when they acquired knowledge, read books, studied economics and did a lot to get where they are now. Do not overlook this step and remember that you need to climb the ladder to be at the top.
2) Experienced traders learn from mistakes
Everybody makes mistakes, wrong choices, bad decisions. It can happen for many reasons. The mistake itself is not that important (if you trade according to the risk management guidelines). What is important is your reaction to it. Lots of novice traders often get emotional and give up after experiencing an unfavourable outcome. Experienced investors view their mistakes as valuable lessons.
They are not afraid to change their approach, try something new and be different. Try to make the most out of losses! Keep track of all your deals and analyze them. Make sure you understand the reasons for both positive or negative outcomes and base the following investment decisions on the data you have.
3) Experienced investors do not rush
Even those of them who raise up from the bottom are not in a rush to make money. Money is a good incentive, but the desire should not consume you or control your actions. Rushing to invest just for the sake of it and trying to take every little opportunity would just be spending your resources irrationally.
Instead, take your time. You will not be making insane amounts of money straight away, because that is simply not realistic. But you could be improving with time, if you allow yourself to slow down and do it at your own pace.
If we had to sum up all of the above, we could say that one thing that separates experienced and novice traders is a more constructive and consistent approach. Evaluate every decision you make and the progress will follow.
