What is Individual trading psychology?
Thank you for reading this post, don't forget to subscribe!Thank you for reading this post, don't forget to subscribe!Individual trading psychology is thought to be a particular set of rules which helps traders to stay calm during trading and not to be exposed by excessive emotions which may lead to unknown consequences.
The matter is that this is an individual psychology, meaning that each trader who decides to step on the market and start cognizing this industry must allocate a particular amount of time on building this psychology.
Trading is full of hardly predictable things, and this is why it’s considered to be a risky adventure. Where there are risks, there are human emotions. This spectrum of emotions varies from solely positive emotions, such as a great delight from closing a first profitable deal, to exceptionally negative ones, such as disappointment about losing a position or being stopped out. All emotions take place, and the inability to control them doesn’t always lead to a good result.
For example, when it comes to solely positive emotions such as delight, then traders may become overconfident about their knowledge and skills. This means that they will stop treating trading seriously; they will think that any of the next open deals will be successful. It’s important to understand that a profitably closed deal is just another point in traders’ personal record books, which helps to create statistics and analyze profitability rates by the end of the month/quarter/year.
On the contrary, moving on to negative emotions, they make traders desperate and disenchanted because of the failure. This evidences that traders won’t be confident about their analysis and will make more mistakes because they are afraid of taking any actions, which may eventually lead to complete disappointment in the trading industry.
In both cases, traders should learn how to control emotions, and there are many techniques employed everywhere. The main goal is to try to find something that will work specifically for a particular individual trader/investor. It takes time, but when one eventually understands how impactful cold-headed trading can be, then he/she will be able to say, “I have my own tailored trading psychology.”
Trading broker also doesn’t play the last role in this process. For instance, some trading brokers provide certain materials on trading psychology or just ensure smooth immersion into trading by giving access to educational materials about trading sphere, where everything is described from A to Z. One of such brokers is the Olymp Trade broker. Traders should feel free to come over the platform and seek valuable piece of information.
Fears and emotions play a massive role for traders, and it’s essential to understand that they should tackle their fears and handle their emotions in order to reach financial goals.
The disclosure that the information presented is not investment advice, either on the landing page or the Terms of Service page.
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