This article in The Trader’s Pendulum Series discusses the first 3 habits of The 10 Habits of Successful Traders to give you areas to focus on to move from hobby to business in your trading. In the last article we discussed The Trader’s Process which you can follow to get organized in your trading. Your goal in developing these habits is to get out of the Technical Trader’s Trap and transform into an Entrepreneurial Trader. By now you have completed the Scorecard (www.fxtradersedge.com/scorecard) and are ready to get down to business.
- Establish a trading business for the right reasons
Make a list of your reasons for entering the trading business. If your main reason is to make a quick buck, you may as well go to the local casino, buy a lottery ticket, or look at the myriad of get-rich-quick schemes on the Internet. Many people are attracted to trading because of the financial rewards that will result in an independent lifestyle. Although this is possible, it is not without a tremendous amount of dedication and hard work. It also helps if you have a passion for trading, and strongly believe that your heart is in the right place doing it.
- Complete a trader’s business plan
For many people trading is a hobby, and for some it’s a business. Where do you fit in? If you want to make hobby money, then treat it as a hobby, but if you want to make some serious money, you have to treat it like a business – even if it’s a part time business. As most people know, there are many aspects to building a business. All entrepreneurs can attest to that. Imagine building a traders’ business plan, which will be your blueprint for success. Take that step towards your part time or full time business.
- Define your goals
How much fun would it be to go to a hockey game where there was no goalie? How interesting would it be to go to a baseball game without a home plate, or a basketball game without a net? How far can a game go without goals? Even businesses have goals – you wouldn’t get far without them.
In defining your goals answer the following questions:
- Do you plan to trade part or full time?
- What time of the day will you set aside for trading on a consistent basis?
- Which specific goals do you have about daily, weekly, and monthly profits and returns?
- Do you have certain metrics that you are tracking on a weekly and monthly basis?
- How do you define a successful trader?
You need to thoroughly think through your specific goals for your trading business.
Next week’s article will discuss Habits #4, #5 and #6.
If you’re interested in adopting these habits and working through the business planning template for Habits 1, 2 and 3 discussed in this article, the book is a detailed blueprint for you to follow and make your own.
If you agree that you want to become a trader or investor who stays out of the Technical Trader’s Trap, then you will need to become an entrepreneurial trader.
I created the FX Trader’s EDGE Coaching Program modelled after the “10 Habits of Successful Traders”, which is the title of my newly published book by Wiley.
Excerpted with permission of the publisher John Wiley & Sons, Inc. from The Trader’s Pendulum: The 10 Habits of Highly Successful Traders. Copyright (c) 2015 by Jody Samuels. This book and ebook is available at all bookstores, online booksellers, and from the Wiley web site at www.wiley.com.