7 tips that will help you survive your first year as a trader - Part 2

5. Treat trading like a business

This is such an abused phrase because people throw it around without really understanding what it means. For us, it means that you need to take trading seriously. Here is what it takes:

• Write trading plans and plan your trading week ahead, analyzing your markets
• Create a checklist that you consult before entering a trade. A checklist contains your trading rules
• Ener all your trades in your trading journal
• Review all your trades once you are done to get a deep understanding of your strengths and weaknesses

6. Finding a mentor

Mentors are great, but they can also be the complete opposite. There are a lot of charlatans out there which make promises about the easy and fast money. Claims about doubling your account year after year, trading 2 hours per day and making “a killing” or other too-good-to-be-true claims are always that – simply not true.

What do you need a mentor for?
Almost all profitable traders trade a system they have somehow developed themselves – at least to some degree. A trading system is something very personal and it has to fit your personality and your character. Thus, do not look for a mentor who promises the “best returns”, but someone who can teach you about trading in general. Someone who builds your mindset, talks about trading psychology, the long-term concept of trading, helps you avoid common problems and prepares you for your journey.

Don’t confuse a mentor for a signal provider or just someone you buy a system from, but a person you can reach out to and who actively helps you become a better trader.

Besides having a mentor, there are a few more things you can do to improve. There are fantastic trading books out there, written by the best traders of all times. You can pick their brains for a few bucks and learn from their mistakes. Here is our top 4 recommended reading list for new traders:

• Peter Brandt – Diary of a Professional Commodity Trader: Lessons from 21 Weeks of Real Trading
• Dr. Brett Steenbarger – Trading Psychology 2.0: From Best Practices to Best Processes
• Steve Burns – New Trader, Rich Trader 2: Good Trades, Bad Trades
• Marty Schwartz – Pit Bull: Lessons from Wall Street’s Champion Day Trader

Obviously, recording your trades in a trading journal is also a must if you want to improve and get better. If you are not analyzing your past trades and trading behavior, how can you improve?

8.Protecting emotional capital

Many new traders burn out easily because they don’t see the results they were after (unrealistic expectations) or lose so much money that they cannot rev

Staying in the game long enough to make it is the real challenge for newer traders. Burning through account after account will also cost you heaps of emotional capital and eventually you will simply give up.

It is so important to understand that this is a long-term thing and you have to make sure to survive long enough to learn as much as you can.

And don’t forget to enjoy the process!

Source: Bloomberg Pro Terminal

Jr Trader Z. Karadzhova

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