Don’t Be a Stubborn Trader
Moe has been trading futures for a while and he trades mostly soybean futures. Before each trading, Moe ensures that he has the right information so that he doesn’t make any mistakes. He doesn’t use any trading systems because he is very certain that he knows the market so well.
Though he has seen some profits during his trading, Moe has been losing a lot and that really annoys him. Despite that, he keeps his losing positions as he believes that he will gain profits soon. He believes in sticking to his positions despite what the market is showing as he believes he knows where the market is heading.
Why Stubbornness Is Bad
As human, we have different personality traits and each can be good or bad to us. As a trader, it is important to have the capability to overcome your ‘bad’ personality traits and don’t let them influence your decisions. One such personality trait is stubbornness.
Like the Moe story above, stubbornness makes a trader gets attached to his decisions no matter what the consequences are. Making a prompt decision and act upon it is what traders have to do every day in their daily trading but sticking to a decision when it is deemed incorrect is a disaster in the making. A trader must have flexibility when it comes to acting on his decisions to avoid losing his own hard-earned money.
Are YOU a Stubborn Trader?
Stubbornness can cause a trader to make several costly trading mistakes such as refusing to place stop loss orders, not following a trading system because you know where the market is heading and holding on to losing trades believing that it will start gaining soon. If you make any of these mistakes, you may have stubbornness in your personality trait and it is may be affecting your trading.
How to Overcome Stubbornness
For a stubborn trader to overcome those trading mistakes, the first step is to recognize the cause of the problems which is his own stubbornness. He also needs to realize that it is a natural human emotion and that there’s nothing wrong in admitting making the mistake.
Once a trader has realized his mistake, he could start anew by trading using trading simulator as it will help him trade without risking real money. Once you are in control of your stubbornness and are consistently making profits, then it’s time to start live trading. Just be sure to not let other emotions get the better of yourself and influence your trading decisions again.
Wan Zuraiha Wan Zakaria is a staff writer at Oriental Pacific Futures (OPF) where she writes on investment and trading. OPF is a futures and options broker based in Kuala Lumpur, Malaysia and provides electronic trading, brokerage and clearing services to retail and institutional traders since 2007. OPF is licensed under the Securities Commissions of Malaysia and offers cash-settled derivatives instruments traded on Bursa Malaysia, as well as select major derivatives exchanges around the world.
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