- It can change your life
- There is no finish line
- You need money to make money
- You will lose money at times
- Uncertainty is the only thing that’s certain
1. It can change your life
You will hear the so called trading gurus say that once you start trading, money will keep flowing in, and you will become rich very quickly.
You might think that this will change your life right? If you fall for this narrative, then you will only lose money.
When I say that trading will change your life, I mean it in a very different sense, and that’s something not many people will tell you.
Trading doesn’t just improve your financial state over the long term, but it also improves you as a person.
Once you go through the trading journey, at every step, you will learn new things about yourself, you will develop new and better habits, and you will become a very calm and composed person.
Yes, trading may make you financially better, in the long term, but, this type of change that trading brings in a trader’s life, is something that’s not talked about much.
2. There is no finish line
Many traders think that once they start trading, there will come a point where they’ll think they have “made it”. I don’t know what “made it” means, but let me tell you one thing, there’s never a finish line in trading.
As I said, trading is a long term thing, how much long term? As long as you can go on.
There’s also never a finish line with respect to how much you know about the markets and about trading.
Traders are constantly learning new things not only about the markets but also about themselves. You need to keep using this to become better at this skill.
3. You need money to make money
Alright now, this might be one of the most important things that no one talks about. You need money to make money. If you want to make more money, you will need more money.
Say that you want to earn $50,000 from trading. Now, that won’t be possible with a $10,000 but it is very much possible with a $100,000 (all of this considered you trade with proper risk management techniques).
Some people might sell you the dream of flipping a $1,000 account into a million dollar account, but all that I’ll tell you is to run away from such people.
If you don’t have much money, it’s fine. Keep trading and compounding your capital until it becomes big enough. And then you can live off the profits.
4. You will lose money at times
If you come across a trader claiming that they have a 100% win rate, then you need to run away from such people too.
So look, we traders will have a strategy that works in a particular market condition, but when that very market condition changes, we will incur losses, which is bound to happen.
Your strategy will face losses at times even when the market condition is favorable for your strategy.
And on top of this, us traders being humans, after all, will take rash or wrong decisions that will lead us to incur losses.
So what does all of this mean? It means that losses are a part of the game and you should never ever think that you will always win.
5. Uncertainty is the only thing that's certain
All of this brings us to the biggest fact in our business of trading, uncertainty is the certainty in trading.
There is uncertainty, that’s why there’s trading, and that’s why we see prices moving up and down.
We can never predict price movement correctly each and every time. If it was that easy, then everyone would use the same strategy and we wouldn’t really go anywhere with it.
You may come across traders claiming that they know exactly how to time the market and predict what the price will do all the time, but you need to know that it’s not possible.
The sooner you understand this very simple thing, the better you start becoming in the way you look at the market and in trading them.