The Path to Trading Success

The path to trading success and becoming a successful trader is an evolution of experiences, ideas, hopes, and dreams. Sure, individually style, and a dose of good fortune, have a bit to do with your results, but there are some hard and fast issues that confront every investor. We'll discuss these issues in this article so you can come away knowing where you need to do some basic work on your own skills.

External Barriers to Trading Success

Before you even get to worrying about the technical and financial aspects of being a trader, you need to understand the outside forces that are working against you. We call them "outside" forces because they operate outside of the market. In reality, they are inside forces because they come from within you.

Fear

Fear occurs when you are playing with "scared money" or money that you cannot afford to lose. It also occurs when you have had a long spell of losing trades and you hesitate to make the next one. The best cure for fear is to make sure that you can afford to lose whatever you have invested. if you can't, then you shouldn't be raiding.

Greed

Greed rears its ugly head when you start making trades that you normally wouldn't make just because pf the lure of "easy money". When you are thinking with the greed side of your brain, the logical side can't communicate with you.

Lack of Self Confidence

When you don't have faith in yourself, in your decisions, and in your strengths, you are more likely to make faulty executions, ignore your trading plan, and practice poor risk management. Any one of these weaknesses can clean out your cash balance.

Failure to Take Responsibility

WHo do you blame when a trade goes wrong? The market? The weather? Your spouse? Your luck rabbit's foot? If you blame anyone other than yourself then you are not taking responsibility. THe result of not taking responsibility is that you look to outside solutions rather than examining your own actions and decisions. You can only become better by making yourself better.

Poor Trading Psychology

Even if you have developed a personal strategies that works as well as can be expected, and you have learned to manage risk within acceptable boundaries, you must still learn to manage your emotional state if your goal is to remain consistent. Most of the biggest problems facing traders come from within.

Getting your Gear

If you are going to be a day trader, then you will need a higher level of equipment and services in order to trade successfully. If you aren't, then here's a rundown of the equipment and software that will serve you best:

Minimum Hardware Requirements

Any decent modern PC with 256 megs of ram, a monitor, good video card, and an ink-jet or laser printer will suffice as a PC trading platform. The monitor should be at least 17" and preferably larger. Depending on the type of Internet connection you want, your PC will need to also be equipped with a network card for broadband access. Expect to pay in the neighborhood of $1,500 to $2,500 for his basic setup.

Internet Connection

Your Internet connection speed is important because you will be spending a lot of time on line executing orders, confirming trades, reading news, quotes and other market data. You should consider cable modem or a DSL connection. Expect to pay about $20 a month for regular dial-up Internet service and between $30 - $50 a month for a cable or DSL phone connection.

Real Time Data

You will want real-time trading information as opposed to 20 minute delayed. Ideally you should subscribe to a service that provides the following feeds:

• Stock quotes and ticker
• Market averages and indices
• Market news stories
• Charting
• Price and news alerts

Prices for real-time data vary widely depending upon your vendor. You should expect to pay in the range of at least $75 to $300 (or more) a month for all of these real-time services.

As you can see, there are many steps to walk along the path to trading success. It's been said that the longest journey begins with the first step. Put on some comfortable shoes and get stepping! There's a lot of money to be made out there. Click here for the Sure-Fire Trading Plan.

Next: Trading for a Living