Naive traders don’t have any experience in the retail trading business. Some of them might have experience in investing business but trading is quite different. To become the best trader, you have to think like a professional. Placing some random orders is might fulfill your expectations, but do you really have a rational expectation from this market? In most cases, naïve traders don’t have any rational expectations. For this reason, they switch to a different kind of trading method because they don’t have any threshold levels. As a result of such a desperate act, rookies in Singapore lose their trading capital.
Do you know why it’s so hard to become a successful Forex trader? People don’t have the urge to learn things by heart. They are looking for an easy way to secure their financial freedom. But no such “Easy Fix” is applicable in the life of a trader. You have to solve your financial crisis by managing your expectations of trading. Let’s learn some key techniques.
Return over Investment
Return over Investment is often known as ROI. To become a good trader, you should have a fair knowledge about the ROI. Expecting more than 10% profit per month is a big mistake. In fact, if you can earn a 10% profit per year, you should consider yourself as a successful trader. But the rookies are trying to earn a 10% gain per day by taking a high risk. Such an aggressive method usually results in big losses and forces traders to quit trading. The safety of your trading capital should be your top priority at the initial stage. Once you become confident about the safety of your capital, you have to focus on the strategy.
The amount of money which you will make by trading CFD depends on your win rate and the size of your capital. Those who have a high win rate usually make a decent profit without losing too much money. You need to create a unique method of trading by which you can win some good trades. Ignoring losing trades and trying to improve your strategy is not a logical approach. You have to find the faults in your trading method and try to fix those issues. Based on your trading results, you have to change your approach to trading. After revising your trading strategy, you will become more confident and set the profit factor based on your win rate.
Always be ready to lose
You must be ready to lose trades in the Forex market. Expecting to win all the trades and trying to beat the market is a very big mistake. If you intend to make a better living, you have to think about the safe approach. Forgetting about losing trades is not the perfect way to develop yourself as a professional trader. You should learn from your mistakes. In fact, pro traders at Saxo are always ready to lose trades. They don’t place any trades without doing proper market analysis. Even after doing the mathematical analysis, they are ready to accept a few losses at regular intervals. So, stop expecting to win all the trades. If you do so, you are not going to make any big changes in your life.
Read stories about the successful trader
One of the best ways to manage your expectations is to read the stories of successful traders. Start reading stories about the successful trader and you will feel motivated. This will help you to build your skills in less than a few months. But this should not force you to trade with big lots. The successful traders are good at managing the risks.
Just like them, learn to manage your risk at trading. Try to ignore the aggressive strategy. Always stay relaxed when you participate in this industry. Last but not least, stop chasing the Holy Grail of trading.