The Mental Game of Trading - Jared Tendler (2024)

FAQs

What is the psychology of trading winning mindset? ›

Winning traders are flexible.

They aren't ego-invested in their trades. They are able to always view the market objectively and easily cast aside trade ideas that aren't working. Winning traders do not hesitate to risk money when they see a genuine profit opportunity based on their market analysis and trading strategy.

Key Takeaways. Trading psychology is the emotional component of an investor's decision-making process, which may help explain why some decisions appear more rational than others. Trading psychology is characterized primarily by the influence of both greed and fear. Greed drives decisions that might be too risky.

According to experts, successful trading is a result of 30% strategy and 70% of understanding Trading Psychology. So, if you are capable of handling your emotions and making full use of Trading, progress is not far for you in the Trading world.

That successful trading is 80% psychological and only 20% method. It was the less obvious psychological aspects of trading. That in my first few years as a trader were letting me down. I started to learn that trying to find reasons why markets were going up or down was irrelevant.

Being successful as a trader is 30 per cent strategy and 70 per cent psychology. It doesn't matter whether you decide the price of a share is going up or down: if you are not able to understand your emotions and use them to make the most out of each trade, then you will not get very far.

By making sure you allow your stressful emotions to dissipate, your body and mind will recuperate and be ready to deal with extreme levels of stress. Trading is stressful and demanding. It takes psychological energy to cope with the chaotic markets day in and day out.

Tharp. Dr. Van Tharp is remembered as a founding father of the field of trading psychology and one of the world's top trading coaches.

How to hold a winning trade? ›

If you want the ability to hold winning trades for longer, you need to lower your risk. The only way to have peace of mind while holding a position for weeks is to know that a loss won't break the bank. That isn't possible if you're risking 20% of your account balance on a trade.

By understanding and managing emotions, avoiding common pitfalls, and embracing individual strengths and weaknesses, traders can elevate their decision-making process. Through discipline, self-awareness, and emotional intelligence, you can unlock the potential of your trader DNA and develop a healthy trader mindset.

Successful traders address issues of scarcity and doubt early in their careers, understanding that it will be impossible to turn consistent profits if they don't feel worthy of financial gain. Over time, they understand that self-confidence comes in small steps, by making the right decisions, one at a time.

Ego plays a significant role in stock market investing, influencing how traders perceive themselves, handle success and failure, and make decisions. Ego, as defined in psychology, represents the conscious and unconscious aspects of an individual's self-awareness.

It is often said that trading is 90% mindset and 10% skills. Having the right mindset is essential for any successful trader, as it helps to build confidence and consistency in your trading decisions. The right mindset can help you make good decisions quickly, remain disciplined and stay focused.

The high levels of stress, pressure to perform, and constant fluctuations in the market can lead to anxiety, depression, and other mental health issues.

A trading personality refers to all the traits and characteristics that affect your ability to handle financial trades. It describes your approach to investing and helps you find strategies that suit you. Many different factors go into determining trading personalities.