If you’re serious about financial market trading, you are always searching for ways to increase your trading profit. Professor Mark Sims, a senior financial trading analyst at Olsson Capital has decided to compile a list of simple ways to increase your profit. According to him, it does not start with winning a trade; it starts with the individual behind the trade.
Set your short and long-term goals in stone
Many traders set the goal of “becoming a professional trader.” This, in essence, is an unrealistic goal as you only become professional once you succeed and with success comes bigger profit. Instead, set a short-term goal of sticking to your trading strategy for one month for example. Once you can reach your short-term goals without failure, you can feel confident to set a long-term goal or two while keeping your short-term ones in check.
Keep it simple stupid
Traders don’t really like the term “keep it simple stupid.” According to a number of traders, financial market trading is a hugely complicated venture to get involved in and should, therefore, be accompanied by complex strategies and trading terms. This, however, is not the case. By keeping your trading strategy simple as well as your thoughts, you create a clear and more understandable approach to your trading venture, thus improving your profit margins.
Planning before you trade
A financial trader can’t simply execute a trade because he or she is feeling lucky. It takes a huge amount of planning and learning before you make a trade. If you plan, approach with caution and make sure you know what you are in for when making the trade, your profit margin will be much higher.
Don’t trade when you are frustrated
Trading can be seen as much as a psychological trade as it would be a financial trade. Should your mind start wandering or you become frustrated with the endless charts in front of you, stop trading immediately and take a breather. Trading when your head is not in the game will cause you to make trades which won’t give you as much profit as potentially possible.
Your gut is the best gut to trust
A larger number of traders tend to become like lost sheep after a while. They watch what expert traders do while trading the financial markets and instantly follow with the same strategy. Do not follow the crowd unless you are 100% sure it is the right way to go. Trust your own gut instead of other traders who might drag you down with them.
Patience is your new best friend
If you are in a hurry to make a profit, you should stop trading right away. Financial market trading walks hand-in-hand with patience. You need to wait for exactly the right moment to buy or sell; otherwise, you might miss your profit window. In markets where prices are highly volatile, it is even more important to make patience your new best friend and wait for when the market price will give you maximum profit before hitting the “buy” or “sell” button.
Strive to improve
Once your trading strategy gets you a few winning trades, you might think that in order to stay profitable, you shouldn't change a thing in your trading plan. Remember that the financial markets are forever changing and are impacted by what happens in the world. Although your plan may give you profit now, there is no guarantee that is will still do so in the future. Strive to improve your trading plan, even if you feel there is nothing to improve on. You never know when higher profits may appear on the horizon.
From the above-mentioned tips, it is clear that in order to increase your trading profit, you first need to start chiseling away on yourself before starting to crunch the numbers. Once you have mentally and physically prepared yourself to enter the trading world, you can start planning, strategizing and executing trades. Some of them may be profitable and some may not – the only way you’ll make it to the top is to never give up, no matter how tough financial market trading may become.