The success of trading depends on many factors: the current macroeconomic situation, experience, deposit size, etc. But there are things that brokers and other people do not say to beginners, for various reasons who do not want your professional growth. Especially when they want to sell an automatic advisor or strategy on how to make money on binary options. We will tell you about 7 important things you need to know before you open your first deal.
1. To successfully trade, you do not need to have Superman abilities.
Probably the most popular misconception is that for profitable trading, a trader must have unique abilities inaccessible to most people. This is not so – many successful traders did not even graduate from college or before entering the stock exchange they were engaged in completely different activities.
Binary options trader should understand this fact correctly: this does not mean that you do not need to have certain abilities, knowledge and skills. If you find it difficult to perceive charts, understand what analysts are saying and make your forecasts, then perhaps trading is not for you.
Remember: necessary skills are not taught in universities, the amount of knowledge does not always translate into quality!
So you do not need to constantly load the brain with next complex trading strategies and indicators with dozens of settings, only someone like Einstein can figure it out. First of all, it is necessary to develop emotional stability, discipline, patience, the ability to control your passion and desire to get everything at once.
Remember: an academic degree in mathematics or economics does not immediately make you a successful trader, although it will not be superfluous as an addition.
2. Humans are by nature not suitable for trading.
Although many manage to earn more on binary options more than others, it should be recognized that people have no thinking and habits of successful trading from birth. In other words, everyone was born to lose trade deposits.
In the process of evolution, the development of primitive human instincts took much longer than the development of those that occupy the more “advanced” parts of the brain and so are necessary for traders. When we risk our money in the market, we behave as primitive people from whom someone is trying to steal food obtained by hard work or hunting. When money (food) is lost, we will have to spend new efforts because we remained hungry.
Reactions do not change in our time when instead of a stone axe we have a trading terminal in front of us. Exchange trading «just» an over 400 years, and active online trading for less than 50 years. Everything also primarily goes signals to a primitive part of the brain. For this reason, we do not leave the market after several unprofitable signals of the binary options strategy, or we take greater risk after a good profit. To overcome this, we need to learn how to use our advanced brain regions that have been developed recently and are more adapted to tasks of planning and keeping short-term temptations to increase long-term benefits.
The fact is that you need to make constant conscious efforts – you cannot just “shoot” what hit markets without a plan and logic of action.
3. Professional traders do not count profit as a percentage.
One of the biggest secrets of real trading that the profit percentage is not the best way to evaluate trading results. Imagine if you were told that a trader earned a 100% Deposit increase over a year. In fact, what is the real situation?
The percentage approach is wrong – any newcomer can open several successful deals in a row, making $600 of a $300 deposit using best binary signals software. Or did the doubling happen after following our plan and strict money management? In any case, the percentages don’t matter and here’s why.
Professional traders (if they do not work for banks or hedge funds) usually do not produce annual reports for shareholders, but trade to make a profit every month. They regularly withdraw money from the account and live for this. Therefore, their balance sheet does not always correctly show the total profit for the year, since most of them are withdrawn from the deposit. They do not control the growth of deposit as a percentage since they constantly withdraw money, and the balance can change significantly every month depending on current profits and statistics on auto binary signals.
In fact, in professional trading, the most important is the ratio of risk to profit … that is, the ratio of the amount of current deposit which you risk to the amount of profit. This will be a true indicator of the effectiveness and a more truthful indicator for comparing different traders. In other words, you should think like this: – “how much did I risk last month and how much did earn on it?”
4. It takes time to become a professional trader.
This fact is never written by sellers of various “super strategies” and “author’s Forex indicators”. Instead, you are told that trading is easy. You do not need to acquire knowledge and experience – just install binary option bot immediately on a real account and earn a million in a week.
The article does not set the task to disappoint newcomers – you can and should earn money on financial markets. But, all successful traders spent a lot of time gaining experience of various transactions and errors before finally switching to the “bright side”. They were ready for possible losses, the search for new ideas and the solution of emerging problems, most often psychological ones that did not give stable income.
Anyone can become a successful trader if he is persistent and patient in achieving the goal. You need to learn how to trade only in your own opinion, to moderate the risks per one transaction and the deposit as a whole. This is difficult to do all the time, but without it, it is impossible to achieve success.
It should also be understood that trading is not an ordinary job with a guaranteed income. Here you never know how much you will earn at the end of the month and this uncertainty causes constant stress for most people. To get rid of it, they set a goal to earn a certain amount and stop the trading process. But financial markets do not work like this – you need to trade and take the maximum profit that the current situation gives. This will make it possible to financially survive periods of lack of reliable top binary options signals or compensation for losses.
In the second part, you will learn why expectations from trading do not coincide with reality, how to get rid of the obsessive desire to constantly earn money, and whether it makes sense to invest a lot of money in technical support of trading.
Read also information on how to learn to trade binary options without losses.