10 Trading Commandments of a Successful Trader📜
In this post, we will discuss 10 divine rules that every trader must obey:
1️⃣ - Accept that risk and losses are a necessary part of trading.
Even though most of the traders are looking for a holy grail, for a system that produces 100% win rate, in fact, losses are inevitable, they are part of the game.
No matter how good you are as a trader, occasionally, the market will outsmart you.
2️⃣ - Have a proven trading system.
Trade only with a trading strategy that you backtested, that proved its accuracy and efficiency.
3️⃣ - Concentrate on the risk, not the reward.
Cut losses, and control your risk. Remember about risk management and never neglect that.
4️⃣ - Never trade without stop loss.
Some traders say that they can easily control losses without stop loss. Don't listen to them. Always set a stop loss once you are in a trade.
5️⃣ - Have an attainable target.
Setting a stop loss remember to know where to close your trade in profit. Follow strict rules and do not let your greed take you under control.
6️⃣ - Take your emotions under control.
No matter whether you are losing, winning, or do not see any trading setups to trade, your emotions will always try to distract you.
7️⃣ - Always stick to your trading plan.
Never break your rules, follow your system, and do not deviate.
Your trading plan is your only map.
8️⃣ - Limit your losses, never limit your profits.
While your gains can be scalable, your risks and losses must be fixed.
9️⃣ - Treat your trading as a business.
Trading should be treated with the same discipline as a business.
Every business has a solid business plan which entails how the day-to-day running of the business is done, and this also guides the decision-making process.
🔟 - Always journal your trades.
Always keep a trading journal. Record your winners and losers, entry reasons, mistakes, failures etc. Revise and learn from your mistakes.
Of course, that list can be extended and more commandments and rules can be added. However, these 10 in my view are the most important. Print that list and let it guide you in your trading journey.
What would you add in that list?