How to Improve Trading Performance

    June 21, 2016

    Trading is seen by many as partly a science and partly an art. It takes a certain skill set and a certain amount of experience to trade successfully. So how can somebody improve trading performance?

    1. Set trading goals and, most importantly, be realistic

    When starting out with a trading account, it's important to take a step back first to ask yourself what you hope to achieve by trading. Are you hoping to be able to quit your day job and trade full-time? Are you just looking for a new hobby? It's wise to define your reasons for trading at the start. What do you want to get out of trading? Set goals. If you spell these goals out in the beginning, it will be easier to tell if you are heading in the right direction of achieving them.

    Also, it's important to be realistic when setting trading goals. Are you hoping to always avoid losses? Or are you telling yourself how amazing it will be to double your portfolio every month for 3 years and then retire to the Bahamas? Likely, it's not going to happen. Be realistic with your goals. Only set goals that are actually achievable.

    2. Define your trading strategy from the start

    The most important skill that separates successful traders from unsuccessful ones is discipline. Successful traders have designed and implemented a strict trading strategy to follow -- or they find one to follow, such as the Bond Prophet position trading system. Successful traders do not deviate from their strategy no matter what, even -- and especially -- when they experience high emotion (for example: excessive fear when it looks like a trade may go south). Using a good trading strategy cuts out all of the emotional factors that come into play while trading which usually cause traders to underperform.

    3. Learn everything you can about financial markets and trading

    Last but not least, it's crucial to always be learning. Study up on economics and financial markets. Learn about stocks and bonds, option trading strategies, futures, etc.

    The Internet is a vast resource of information. Use it, and use it often. There is always more to learn. Continually learning all you can, you will be amazed by how much your trading performance improves.

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