Every trader begins their own arduous trading career by taking baby steps in learning and improving their knowledge and skill in a continuous manner. They need to focus all of their energy and effort to improve the probability of wining in every trade made while simultaneously learning to deal with emotions. Everyone of us are unique individuals. We look at the same situation but we react and also analyse it differently. While the basic knowledge for trading, both fundamental and technical analysis are similar for most financial instruments, an example can be the analysis of the potential of a certain company stock to make money. However, the methods of trading, the trading plans,level of discipline and emotional aspects for each individual are very different. This is why it can be difficult to make money in the market and have a trading career if the individual trader does not improve on his areas of weaknesses.

So what are the attributes for a successful trader? There are 10 attributes that are crucial to the success of a trader. But one thing to note that even though you may have all of these attributes, the probability to lose money is always present as the market is a place where human emotions congregate. Just like weather and the moods of a woman, it is difficult to predict and impossible to say that you will always win in every trade you make. This is the most important thing to take note of when trading. For beginners and other amateur traders, it is always good to keep learning as trading is one of the toughest careers in the world. The 10 attributes are:

1 ) Properly capitalized with money that you can afford to lose.

Trading is a difficult career, if you are not properly capitalized with money you can afford to lose, chances of losing money is always present and high as we will definitely make mistakes during the learning curve. One of the common mistakes tend to be over trading in a single trade. When the market moves according to the trader’s prediction, he will surely be happy. But again, what happens when the market moves against that persons’ position?

2 ) Understands the financial instrument being traded.

There are many different types of financial instruments available for trading in the market. Understanding the instrument you trade is essential. What good are you doing yourself when you don’t know how the financial instrument you are trading works? This is especially more important for derivatives since the presence of many factors in the pricing of the instrument can result in losses even though the market moved in the direction you predicted.

3 ) Has a trading plan.

Having a plan is important. A trading plan is like your strategy for entering and exiting a trade. It is like your navigator in darkness. While in trading, it is your entry and exit system for making and taking profits, and also your management of capital available for trading. Without one, you are like a blind person moving around an area full of traps and pitfalls everywhere.

4 ) Able to practice self-discipline.

The ability of a trader to continue learning, stick and adhere to the plan while not allowing emotions to take over is an essential internal attribute. One example of the importance of continuing to learn, can be the case of some people who allow arrogance to get the better of them which will become their downfall eventually since they think that learning has become unimportant. If there is one thing to remember, methods and information will keep changing with time, falling behind is imminent when one stops learning.  

5 ) Able to remain focus

We occasionally hear some traders complain that while they are away to the washroom for just 5 minutes, a huge loss has occurred in that short time span. We even hear people complaining that they got distracted while chatting online that they entered a trade wrongly resulting in losses. These are just typical scenarios that had happened on the misfortunes of these poor traders. Are you one of these people who cannot remain focused?

6 ) Able to control and use emotions to your advantage

This may sound contradicting. The ability to control your emotions is essential and remains very important as allowing emotions to take over will mean losing control of the trade. However, we do hear people with intuition, womans’ sixth sense or gut feeling. These people can use that to help them to increase the probability in their trades provided they base it on their plan, trading system…etc. It is important to note that the main focus still falls back on a system to trade. If you are one of these people with blessed gifts, use them wisely to your advantage.

7 ) Has a low tolerance for risk

Successful traders hate risk. The trading business is already a risky business due to many internal and external factors. Having a low risk appetite, lowers the risk probability of losing money. You should practice minimizing your risk and learn to preserve capital as your top priority when trading.

8 ) Has a risk management plan.

Just like your trading plan, this part forms the risk management of all your trades. They are your criteria to exit the trade immediately when it doesn’t favor your predictions or forecasts of the market and is resulting in losses. These criteria will assist in cutting losses and preserving capital. If the trading plan is your navigator in darkness, this part of the plan is like an anchor of a ship. They will stop the ship from toppling and capsizing in a storm while also preventing the ship from moving. Doesn’t this sounds just like your stop loss, sell stop …etc?

9 ) Treats trading as a business.

Like any other business, the way trading works is similar. Whether you make gains or losses, it is comparable to a business during good and bad times.

10 ) Back testing of your trading methodology

There are many trading methods available but how many can withstand the test of time? Is your method tested over a substantial period of time with a high rate of success?