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When you trade for a living you are essentially a business owner trading for profit. One of the biggest barriers to achieving a full time income in trading is changing your mindset from that of a passionate hobbyist to one which is more profit-oriented. It is often said that trading is one of those rare jobs where you will not feel like you are working if you enjoy it. That statement definitely has some truth in it but there are also a few basic business rules which you should not forget if you are going to bridge the gap between passion and profit. Here are some of those rules:
It is not uncommon for employees to complain about having to show up for work when they do not feel like it. Having to deal with demanding bosses, less than cooperative co-workers and cost-cutting clients can make even the best job a living hell. When asked why they wanted to learn how to trade, one of the top reasons given by beginners was that they eventually hoped to quit their day job. Trading full time does remove you from having to deal with troublesome people to some extent, but it does not mean that you can check-out whenever you feel like it. A misconception about trading full-time is that every day is fun and full of excitement, however the reality is there will be challenging days like any other career. In order to become proficient and make a full-time living from your trading, you still need to turn up to trade every day even when you do not feel like it.
In the workplace, most employees will have a semi-annual coaching meeting and annual performance review. Although these sessions are designed to provide feedback and help employees improve on their weaknesses, many see these structured sessions as terrifying and confrontational. There is a desire to escape and sometimes becoming a private trader can be seen as a means to do so. Trading on your own does allow you to break free from formal reviews, however the lack of a structured system for personal development can be detrimental in the long run if you do not commit yourself to some kind of plan in lieu. It can be harder to manage your own personal development too, especially since most private traders are the only people involved in keeping track of and evaluating their performance. Keeping detailed trading records is essential and joining a trading clinic or support group is also recommended. You are more likely to avoid making necessary changes and improvements if the only person you are accountable to is yourself.
The question most people like to ask when meeting someone for the first time is “what do you do for work?” Nowadays, our identities and self-worth are becoming inextricably linked with what we do in our jobs. Work place achievements seem to count for more than having a good character or being a nice person. Everybody wants to be a winner and associate with other winners, but what is the true cost of so much emphasis on winning? The downside is not yet apparent but it is likely to be more detrimental than not to link identity and self-worth to how you perform in your job. Some consequences of adopting this pattern of thought is an inability to cope under pressure or deal with challenges and setbacks. We become scared of failing and are under constant pressure to be better than the people around us. It can be exhausting! A job should not be a reflection of who you are. In trading, losses are part and parcel of a trader’s life and you cannot expect to win all the time even if you applied your strategy flawlessly. It is not the outcome that is important but rather the process and journey of becoming a better trader. Trading is not who you are, it is simply something you do and it should bring more pleasure than pain for you to persist with it in the long term.
Hopefully this article and the above tips can help you transition from being a hobby trader to a full-time one. Trading is immensely rewarding if you master it. Happy trading!