The Essential Skills needed to be a Trader

I'll be away from the 19th April till the 4th May so I won't be around to produce new content. I decided to to re-publish old blog posts that focus on the psychological aspects of trading so I hope you enjoy! See you soon 

The 4 Traits of a Successful Trader

I have to admit that I'm a huge soccer fan and over the years I've built a certain affinity to one team in particular. But today isn't about testing our loyalty to one team or who's currently leading the league. It's about highlighting the advantages of consistency in every area of our lives and how having the right mindset is essential in ensuring long term success.

Sir Alex Ferguson is one of football's most successful managers of all time. His records speak for themselves and the time he spent during his 26 and half years at Manchester United has been described as "the Impossible Dream". His built up a number of teams all of which have been able to exhibit a distinct progression in the game of football.

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However what strikes me the most is his performance record over the years. I was able to find them on a Man Utd fan site. According to the website Ferguson was in charge of the Red Devils for a total of 1500 games of which he only won 895. That would give him a win ratio of 59.67%.  In other words every time he assembled his team and marched them onto the pitch, he had a 60% chance of winning the game.  Under his reign his players scored 2769 goals for the team and only conceded 1365.

Here's a few things I think is most important about the stats

1. Although he won 60% of his matches he was able to accumulate a cabinet full of trophies. This speaks so closely to a trader as it does in football. A league isn't won in a single game but rather over a season of games cumulating in the most consistent team winning the cup. In trading we often feel disheartened by one loss but don't realize that it takes more than one trade coupled together with good discipline to build our accounts. 
2. Ferguson was known to manage his players well both personally and skillfully on the field. He knew each player's attributes and used them to their full potential. Trading is much the same in the sense that each indicator we use should be fully understood and accepting that they don't always workout isn't a train smash. Our jobs is to be consistent. 
3. The goal difference at the end of his career was a staggering +1404. For every goal conceded the team was able to score 2. When trading it's always imperative to be rewarded with more profits than losses so that you're able to be profitable. It's a simple equation that so few exercise. 
4. Finally time is the most underappreciated asset of a trader's career. Spending close to 27 years at the helm, Ferguson was able to capture the most prestigious titles in the world because his team was prepared when those moments of glory awaited them. The same goes for a trader. Time is your friend not the foe. Being able to survive the markets in times of drawdowns allows your system enough time to work when the conditions become right. 

Drawing from the philosophies used by Sir Alex one can see how playing a game is a lot more than just winning. It's about being in control of your emotions and guarding your goals when tough times loom. The real reason people stay in a job that long is because they have a passion for the game, money comes secondary and when you are able to reach that point in your trading journey you'll be able to say that you've successfully mastered the skill of trading.