The following are 5 common pitfalls I have seen traders experience and I have listed 5 practical solutions you can quickly implement to overcome these assassins to your performance.
Pitfalls
- Focusing on the P & L
- Losing objectivity while in a trade
- Becoming emotional about a trade
- Lacking confidence: exiting early, failing to put a trade on, not sizing up
- Difficulty adapting to a changing market
Solutions
- 1.Quantify success base on the caliber of the trade (i.e. high quality entries/exits).
- Continuously ask yourself, “is my original reason WHY I entered this trade still there?”
- While you are in a trade, ask yourself, if I had no position on right now, what would I do? Buy? Sell Short? Do nothing? Then re-evaluate your trade size and direction.
- Confidence should always come from within. Step#1: Write bullet list of data points proving WHY you are a skilled trader. Step #2: Prime yourself each morning by reading it over to yourself. Could be the most valuable 30 seconds you spend each day.
- Flip your perspective by keeping track of what is not working (by default this tells you what IS working).