It’s been an amazing 20 years of trading lessons, mistakes, and progress…
And to think, I’ve had 11 of those amazing years to share as much as I could with you.
It has been my passion and privilege to share with you and to help show you the real world of trading.
And so, today whether you’re a new reader or a veteran reader of the newsletter…
I am going to tell you 12 top trading lessons I’ve learnt in the last 20 years and how you can apply them to your trading arsenal.
Let’s get into them.
Trading Lessons #1: The more you learn the more you’ll earn
Every day you should make a small effort to learn more about how trading works, what works best for your trading risk profile as well as how to control your emotions through psychology.
That’s why you should bookmark and save this email address, to never miss out on essential information coming your way.
The more you train and learn, the better the chances you’ll grow your portfolio…
Trading Lessons #2: Only trade when your strategy tells you to!
We both know that trading involves elements of risk.
It becomes even riskier when you get into a trade blindly without a plan.
In fact, most newbies try to trade on intuition and base their strategies on how they feel.
If you don’t have any proven statistics, then the strategy is most likely going to fail in the long run.
Make sure you are trading using a proven and profitable trading strategy and only take your signals whenever a trade lines up.
Trading Lessons #3: Your trading strategy is like a game-plan
Every time you’re about to enter your trade, you need to know exactly what the best and worst case scenario is before committing any funds.
That’s why you need to ensure your trading strategy tells you:
• Where to get in (Entry)
• Where to exit (Take profit & Stop loss)
• How much to commit (Volume – Number of CFDs to buy or sell)
• The risk and reason for getting into your trade
Lesson #4: Bad patches are inevitable
All markets go through cycles of good and bad times.
They all go through up, down, sideways, small ranges and big ranges.
That’s how demand and supply works with human nature.
Make sure you stick to your trading strategy with a drawdown management policy and keep at it until the market rectifies itself.
For example. When the portfolio goes down around 20%, this is a good time to HALT trading (Not stop).
And then wait for the market conditions to improve, paper trade (demo trade) until it is in a favourable environment for your trading.
And then, go at it again LIVE and with real money – to grow your account.
Lesson #5: The three golden rules to money management
Always remember these crucial rules when trading any market.
• Never risk any money you can’t afford to lose
• Only risk a tiny percentage of your portfolio per trade
• Drawdowns are inevitable – Know how to manage them
Lesson #6: Control your emotions
Emotion management is essential when trading.
If you feel stress and pressured after taking a loss – You’re risking too much money.
If you feel elation and on top of the world when you’re taking a gain – You’re still putting in too much money.
It should be a neutral game when you trade. Your emotions should be in check, and you should treat trading like a business…
This leads to lesson 7.
Lesson #7: Treat your trading like a business
Trading is a longevity game, just like business.
The losses are simply costs of doing business.
The gains are the revenue that comes with running businesses.
Treat them as such.
You need to learn to preserve and protect your portfolio and profits.
If your business or trading account is down more than 20%, you need to analyse, assess, and find out how to avoid that situation in the future.
Lesson #8: Maintain your discipline!
If you want to make a consistent income trading, you need to find a suitable time every day to sit down and commit to your financial responsibilities.
NOTE: I personally trade 15 minutes a day.
So I assure you, you can find 15 minutes out of your day!
Lesson #9: Patience pays
Even though trading is an active practice, it requires a big portion of your time to waiting.
• You wait for your trade to set up
• You wait for your trade to play out
• You wait for your trade to hit your exit levels
If you can find a way to improve your patience, you’ll find your portfolio will start to flourish.
Lesson #10: Test, Test, Test
Sure you might have a proven trading strategy, but you should always be testing even if it’s through paper trading.
Use your trading and charting platform and start testing other strategies.
You never know when you might find an even more profitable trading strategy than the one you have.
Lesson #11: Save money every month to boost your portfolio
I have created an infographic with 27 ways you can save money to trade for 2024
Here they are…
Trading Lessons #12: Persist
You need to keep going.
Do you know why 95% of traders fail?
They don’t! No trader fails.
They quit.
And if you keep going, applying, gaining insights and information. Absorbing, applying and keep at it – You will make it as a trader.
It took me 8 YEARS to get it right!
I could have quit during those 8 years. But I didn’t. And it’s all because of one word.
Persistence.
That is my biggest tip I can ever share that will make you succeed. I hope these 12 lessons resonated with you like they do with me.
