What is a trading mindset? Being a trader isn’t just about coming up with better strategies and doing more research. It’s also about having a winning mindset. According to a lot of studies of traders, what separates a winner from a loser:
- It’s not that successful traders come up with better trading strategies.
- It’s not that the best traders are smarter.
- In fact, it isn’t that the best traders do better market analysis.
What makes a good trader and a bad trader different is how they think about things. Comparison between Disciplined Trader and Emotional Trader is given below:
| No | Disciplined Traders | Emotional Traders |
|---|---|---|
| 1 | Trade a defined trading plan. | Trade based on emotions. |
| 2 | Manage risk. | The more confident they are the bigger the trade. |
| 3 | Exit a trade when wrong. | Hold a losing trade to prove they are right. |
| 4 | Exit based on predetermined stop. | Exit due to fear. |
| 5 | Enter based on a set up. | Enter based on greed. |
| 6 | Do the homework. | Believe they are special. |
| 7 | Trade based on price action. | Trade based on their opinions. |
| 8 | Only want to make money. | Want to prove something to some one. |
| 9 | Trade with focus and calm. | Trade with stress and strong emotions, |
| 10 | Lose and move on to the next trade. | Blame someone after a losing trade. |
| 11 | No one trade means much. | Over celebrate wins and get depressed over losses. |
| 12 | Have a steady state of mind. | Have huge swings in moods. |
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