An Active Trader And The Quest To Be One   

As a professional active trader, I'm often asked how one can become a full-time active trader and make a living. The thing is that I do not create my lifestyle merely out of trading the markets. The biggest cause so many people fail in trading business in the worst possible way is that they spend their time investing in time, funds and all their resources into one single activity.

Professional active trader(s) do not trade with scared money

Whether it is trading or selling wares on eBay, there is an adage that holds true for everyone — never put all the eggs in a single basket. Just like you shouldn't put your entire account balance into a single position, it is unwise to put all your cash into trading activity. The obvious result of this will place unnecessary pressure on your trading, and this can have emotional repercussions.

You could blame your current lack of success on the fact that your keys to success have not yet been well defined, perhaps you lack that "killer" strategy and analysis. But one thing you should know is that there isn't a single approach that is going to make you an overnight success as an active trader. Many people make the major error of shouldering the heavy burden of "I have to win big or bust." 

Active trader and scared money

Professional active trader(s) do not trade with scared money, and this is another very common mistake many novice traders make is using the money they really can't afford to lose in their trading. There are numerous horror stories of people using loans, or money designated for specific needs that end in an awful tragedy. Using cash that is essential to living guarantees that all your trading will be done with a severe emotional factor and this can mean big trouble. 

If your current financial situation doesn't allow you to lose your hard earned cash, then it may be prudent to stay away from trading. Only use that funds you can afford to lose on your trading. But until that day comes there are demo accounts that can be used to gain valuable experience. 

Active trader and scared money

Professional active trader(s) do not trade with scared money, and this is another very common mistake many novice traders make is using the money they really can't afford to lose in their trading. There are numerous horror stories of people using loans, or money designated for specific needs that end in an awful tragedy. Using cash that is essential to living guarantees that all your trading will be done with a severe emotional factor and this can mean big trouble. 

If your current financial situation doesn't allow you to lose your hard earned cash, then it may be prudent to stay away from trading. Only use that funds you can afford to lose on your trading. But until that day comes there are demo accounts that can be used to gain valuable experience. 

Trading as a one-way street to success

There will be times that only the desire to succeed will make or break you. This is as true in many aspects of life as it is in trading. If you have convinced yourself that making profits through trading is a one-way street to improving your financial future, you will also be putting an unnecessary amount of strain on yourself as a trader. 

Perhaps the most important reasons that successful traders manage to see the success they do is because they are the ability to distance themselves from this stress. The ideal option is to wait until you can accumulate enough funds to use for trading exclusively, without impacting your lifestyle.  

This one reason it is vital for the wannabe active trader to remove themselves from any of the emotional and attachments to risks that are sure to happen eventually. The way to do this is to assign a designated amount of cash that will only be used for trading and no other funds for living expense or other financial responsibilities.

Then you will need to have a backup plan for making money in the future. Sure this sounds paradoxical, most people who begin trading do so because they lack the financial resources for some purpose and are looking to make some more cash.  Nevertheless, knowing that you can indeed afford to lose this risk capital can help you avoid the emotional entanglement on your way to greater profits. 

The market delivery

Do you know anyone that continues to put endless amounts of money into a losing business without admitting that his or her business model is not working? Despite the increasing losses they will continue to pour their resources into the failing venture. This can happen with a trader's accounts too if they continue with the same poorly appointed money management scheme. 

I've even seen active trader(s) place themselves under such pressure to win and thereby increase their bottom line that they are "forced" into a cycle of over-trading or taking severe risks or even worse doing them both at the same time.   

Setting unattainable goals like trying to triple the value of an account within a few months or making plans to quit the day job in order to become a full-time trader in just a couple of months. 

Consider your trading experience a long-term process that will bring about more and more profits in time as your prudent account management system is practiced from day to day. While it will take some time, using a moderate trading strategy provides a better experience in trading practice as you see what works and what is ineffective.

Education and experience

It is possible to become a successful active trader by adopting the mindset for trading success. By choosing to be a qualified market participant you will be able to handle your accounts and trades dispassionately and professionally.

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