We hear staggering statistics that approximately 95% of traders fail in their ability to consistently profit from the markets.

What are the 10 major mistakes that these traders make that cost them dearly?

1. Having no trading plan
   When you don’t have a plan, you don’t have a template to follow. It becomes very costly when your emotions are high and you have to make decisions on the fly.
2. Using strategies that do not match your personality
   You hear of a trading strategy that has worked very well and you are anxious to follow it. One important factor to consider is: does it match who you are and your lifestyle?
3. Having unrealistic expectations
   Most traders assume that it is very easy to make money in trading. They have unrealistic expectations with regard to their initial capital, their risk profile and how much money they can expect to make.
4. Taking too much risk
   Usually when traders are down, they want to make their money back very quickly. Therefore, they increase their position size without thinking about the risk/rewards.
5. Not having rules to follow
   Most traders think if they have rules to follow, they are restricting themselves. It is on the contrary. Having rules allows you to be more flexible since you have thought about lots of issues beforehand.
6. Not being flexible to market conditions
   It is very important to see the markets as they are and not as you want them to be or as you assume them to be.
7. Failing to take responsibility for your results
   When the results are not in your favor, the tendency is to blame the markets, circumstances, advice of others… When you blame things outside of yourself, you become a victim of circumstance. When you take responsibility, you can react differently to your circumstances and become the success you know you can be.
8. Being addicted to volatility
   One of the reasons that people get into trading is because they like the excitement of it. If there is no excitement, they create it. This is one of the reasons that traders sabotage themselves.
9. Not having a process to keep track of your performance
   If you don’t keep track of your results, how do you know what has worked and what has not? How can you tweak your process to get the best results that you can?
10. Not dealing with your Emotional Risk
    When dealing with money, there are lots of emotions involved. Emotions are part of everyday life. What separates the successful traders from others is how they react to their emotions.

So what can you do to become a more consistent trader and increase your profitability?

1. Think of trading as a business and have a trading plan.
2. Make sure that the strategies you select, match your personality so you can follow them.
3. Have a realistic expectation of what your returns are. Include all the costs associated with your trading business.
4. Have an idea for your risk/reward ratio. Don’t confuse trading with gambling. If you are increasing your position, make sure that your strategy warrants it.
5. Have trading rules and follow them. Think about them as contingency plans. Because when your emotions are very high, the tendency is that you make very poor decisions that can cost you your account!
6. Be flexible to the market conditions. When you see the market as it is, you have a much better chance of managing your portfolio and increasing your profits.
7. Take responsibility for your results. Taking responsibility does not mean that you have control of everything that happens. It means that you have a choice of how to react to the things that happen.
8. Find out why you are in the trading business. If it is for the excitement of it, find other hobbies or activities that you can get your excitement from.
9. Keep track of your performance. This is a way of objectively looking at how you are doing, what you did right and what you learned. Be gentle with yourself.
10. One of the most important things that people don’t handle is their Emotional Risk. When emotions run high, the quality of decisions goes down. It is very important to learn how to react to your emotions and thus increase your profits.

“At first, something seems impossible. Then it becomes improbable. But with enough conviction and support, it finally becomes inevitable.” Christopher Reeves

Here is to making trading success your habit™,

Have you ever wondered why traders don’t make money consistently?

Do you blame the markets, the systems, lack of information or information overload, etc…?

The truth of the matter is that you don’t trade the markets. You trade your perception of the markets.

Let me explain.

When we look at markets, we look at them based on our filters. Our filters determine how we view them and what state of mind we are in.

What are our filters and how do we develop them?

Our filters are beliefs/thoughts/actions based on our own previous experiences as well as the experiences of our mentors/influencers in different aspects of our lives.

An example is media. On a daily basis, we are bombarded by negative messages. So, we tend to focus on what can go wrong and are constantly waiting for the other shoe to drop.

What differentiates the traders who make money consistently is that they hear what is being said – instead of getting influenced and drained by it, they look at the opportunities that are available.

Did you know that more millionaires were made during the Great Depression than in any other era in U.S. history? Among them are Colonel Sanders, who was a grandpa when he started Kentucky Fried Chicken, and Walt Disney.

Furthermore, Forbes magazine says 10 million millionaires will be created by the year 2016.

What is the difference between the millionaire and others? They don’t have the filters that the majority has. They don’t follow the conventional beliefs…

There is a story that I heard which reminds me that nobody is immune to these beliefs.

There was a holy man who was in charge of fundraising to provide services in the community. However, his perception was that fundraising is equal to begging. So he was trying to avoid it with passion.

He came up with the brilliant idea that he would get money from investors and use the interest for charity work and pay back the principal to the investors. Sounds like a great idea, yes?

The problem was that he lost all the money in 3 weeks. So, after all, he needed to raise more money, which for him meant even more begging.

What is the moral of the story? If we don’t notice our beliefs and make a conscious choice about them, then they come and haunt us in different ways.

So what can we do about our beliefs?

1. Acknowledge them
2. Examine them to see if they are serving you
3. If the beliefs are a hindrance, replace them with new ones that serve you

The important thing is that the beliefs that are not serving you have an affect only if you are not aware of them or don’t do anything about them.

Albert Einstein has a saying: “The significant problems we face cannot be solved at the same level of thinking we were at when we created them.”

Remember, we are not defined by our abilities. We are defined by our choices!

To discover the strategies for making better choices and creating the kind of profits that you want, click here.