Life Lessons Trading Taught Me
Trading has a funny way of teaching you many invaluable life lessons that extend far beyond the realm of the computer screen and financial data.
Trading is not just about buying and selling assets; it’s a profound journey of self-discovery and personal growth.
One of the fundamental lessons trading has taught me is the importance of discipline. Successful trading requires a meticulous approach, sticking to a well-defined strategy and trading plan and resisting impulsive decisions. This discipline has translated into other aspects of my life, fostering habits that promote consistency and long-term success. It’s even helped me to stay the path and commit to my plan to lose weight, and getting fitter and stronger at the gym.
Risk management is another crucial takeaway from the world of trading.
Understanding the delicate balance between risk and reward has taught me to approach challenges with a calculated mindset. Life, much like the markets, is inherently unpredictable, and learning to manage risks has become a cornerstone of my decision-making process.
I use stop losses in my trading to manage my risk and protect my capital, ensuring that I only ever have ‘one unit of risk’ on any one trade, and now I take the same approach in my life as a whole.
Patience is a virtue and often underestimated, yet trading has underscored its significance in both financial and personal pursuits. Markets fluctuate, trends and market setups take time to unfold. In life, patience has proven to be the antidote to impulsiveness, allowing me to navigate challenges with a steady hand and a focused perspective.
Adaptability is a skill honed in the crucible of trading. Markets evolve, and the ability to adapt to changing conditions is critical for success. This adaptability has translated into a resilient mindset in the face of life’s uncertainties, enabling me to navigate unexpected twists with composure and confidence.
Clear Concise Decision Making is a true asset in trading – and often as traders, we need to make decisions in a split second. It’s not a skill we are all naturally born with, but is something that we develop over time. Having a well-researched and thought out plan when trading, gives you the confidence to make quick, clear concise decisions with ease. It is simply a case of asking yourself the question, ‘How does this align with my overall plan?’ It’s the same too, in life. I now research things in much more detail, and make sure I am well prepared and informed before making any decisions. I can then make a decision with more certainty, confidence and conviction, knowing that I have a plan if things don’t go according to plan.
Persistence is another really important life lesson trading has taught me. Learning to trade has been one of the hardest things I have ever done – much like parenthood – and similarly, the results are well worth it! In the same way when I’m grappling to learn a new trading skill or concept, there is a determination that comes from deep down inside that I refuse to give up until ‘I get it’. The same in life – I now refuse to cave in and give up, opting for the easier path. I now choose to see things through to completion and have an ‘until’ attitude. “I am going to keep going until …….”
Above all, trading has taught me the value of continuous learning and incremental improvement – Continuous learning is something that’s really important to me so whether I’m learning a new trading skill or concept, I always have something I’m working on. I have learnt too, the importance of tracking my results (it’s something we cover further in this article The Art of Keeping Track: Recording Your Trading Results) and realising that even a 1% improvement, is still an improvement. If you get one percent better each day for one year, you’ll end up thirty-seven times better by the time you are done! (This is something covered further in this great article by James Clear, author of Atomic Habits here.)This is something I’ve taken from my trading and taught to my children too – they don’t have to be A grade students, just focus on a 1% improvement. It’s helped them become better problem solvers and to develop a growth mindset.
If you get one percent better each day for one year, you’ll end up thirty-seven times better by the time you’re done!
In essence, the lessons from trading extend far beyond financial gains and losses. They’ve sculpted me into a better person and I’m a more resilient, disciplined, patient and observant person because of choosing to Learn How to Trade.
They say learning to trade is not just a destination; it’s an ongoing exploration of the markets and, perhaps even more importantly, of yourself. Whether you’re a novice entering the trading world with wide-eyed curiosity or a seasoned investor seeking to deepen your understanding, and to improve your results, and with less risk, we can help!
All of our students start with the Active Trader Program and for good reason – When you get the basics right, you have a strong foundation on which to build your future skills and trading success. Many of our students at this level are achieving 10:1 Reward to Risk Ratio (or more) on their trades.
* For a limited time, our Active Trader Program comes with 3 months FREE coaching (value $447). Find out more here