How to become a profitable trader
I have been trading for over 10 years, next year I will be in my 30s.
The below PNL chart shows how I was able to turn 56K USD into nearly 10 times of account size, at 480K USD.
This is the TIGR account that I was trading in 2019. Because I am restricted to demonstrating my clients’ account information for confidentiality issues. I can only demonstrate my 2019 account.
Many online sources claim that they could make money all the time, unfortunately, these are pure lies. Most of my profits are made through mid-to-long-term bets, and with carefully selected entries and exits.
In the meanwhile, I was able to make profits through trading VIX contracts and ES futures contracts plus some of the high volatility stocks. I also trade lots of options, I will select low IV contracts and sell these contracts when IV is trading at a high level.
I understand lots of folks want to be professional traders but it took me nearly 5 years to learn what I have learned today and I am still learning.
There are 3 key things to do if you decided to become a profitable trader:
- Make a solid trading plan, every time before you trade.
People tend to ignore or skip this process. Lacking this process will vary to result in huge losses since traders will lose their focus, entry, and exit easily.
When losing valid entry and exit traders will lose their price target and will eventually lose the entire directions to trade. Having a solid plan means that you have done your research thoroughly and know what to do in different scenarios.
2. Better research, better results.
Having random trades will always destroy your account. As traders, we only capture those good potential opportunities with the best risk-reward ratios and best upsides. When you work to improve your account PNL, you should first improve your research skills.
Proper fundamental and technical analysis skills will improve one’s trading performance dramatically. Fundamentals will unlock the price drivers and technical skills will help you better time your trade. There is nothing really fancy about technical indicators. They are very useful and these indicators are timing tools and that’s all.
3. Understand WHAT you are trading.
Most junior traders and rookies make tons of mistakes when choosing the wrong financial instruments and have zero knowledge of the underlying assets or stocks they are trading. Especially crypto traders, they often don’t give a crap about what they are trading.
If you want to achieve long-term success in the financial market then you should familiarize yourself with solid knowledge of what you are trading. If you are trading stock you better understand what this company sells and its business model. If you are trading forex or index products you should understand the asset price driver. Some are trading extremely leveraged products like CFDs, if you don’t know what you are doing you will have your account ruined.
To wrap up all things above. Trading could be both tough and exciting depending on how much effort you want to invest and improve your skills. If you are interested in knowing more about trading plz follow my Twitter and my youtube channel: 灰岩金融科技ravenrock
