7 Habits of Highly Successful Traders

Steven Covey's famous book "The Seven Habits of highly successful people" list down the habits of highly successful traders. According to the book, the people who do trading in the stock market attain their success by following some habits. It is not possible to become successful just with good luck. It requires disciple and skill. You can behave as a professional trader by following a certain type of behaviour and approach. In this article, we list 7 habits of highly successful traders in the stock market.

· Humility and Passion

To be successful in the stock market, it is essential to be passionate and humble. Passion is important to understand that trading is a serious business and it requires constant improvement. When a trader is passionate he would try to learn things that can make him successful. However, along with passion, it is equally important to be humble in the market. Humility helps in realizing the fact that you will always be a student of the market and the market will have the ability to surprise you all the time. Therefore, humility and passion are the core ingredients to becoming successful traders in the stock market.

· Discipline

Discipline is one of the key ingredients to being a successful trader. A trader must follow strict rules and always have a stop loss in place. In the long run, only those traders win who follow a set of rules and not the ones who rely on luck. Being disciplined will help you book timely profits and protect your capital. If you can protect your capital well, profit will automatically follow your trading journey.

· Keep Realistic Expectations and Be Optimistic

You can be a successful trader only when you are optimistic. You must be a believer and always have the hope of finding a way out even in the most difficult trades. Along with optimism, he must keep his expectations realistic. There would be days when you would earn good returns while there can be bad days too. Based on those events you must be able to adjust your expectations and always keep a positive attitude in the market.

· Learn, Persist and Patience

One of the qualities of a good trader is that he will learn from his mistakes. It is impossible to not commit mistakes in trading but learning from them is important. Smart traders learn and recover fast from their mistakes. Also when you have a trading plan in place, learn to persist with it and be patient. Patience and persistence will help you in becoming a successful trader.

· Risk Management and Capital Protection

If a trader knows the art of managing risks well, nothing can stop him from being successful. Managing risk is the priority and then following the profits. Never forget that the returns are not in your control, markets control them. But managing risk and protecting capital is in your control. By defining your risk per transaction, you will be able to trade with a good risk and return ratio.

· Never Panic

A good trader never panics and sticks to his plan. A trader who is well disciplined and knows well to execute his plans will never panic in any situation. The less you will panic, the higher will be the chances of you being successful in the market. Never forget that returns in the market are finite and when you panic you will lose the chance to participate in the market.

· Trading is not Gambling

Many people equate trading in the stock market with gambling. But the reality is different. A good trader will focus on his trading plans and take risks that he can manage. He will never blindly buy any random stock to gamble. A good trader understands the market situation and then calculates the odds of being successful with his trading plans. If anyone trades in the market like a gambler, the journey will end soon.

The above-mentioned are the 7 habits of highly successful traders from Steven Covey's book. When you apply these rules in trading in the stock market, you have a long way to go. By following these rules, you may become a successful trader. The stock market is an ocean, you keep learning about it every day. So with the right approach and attitude, success can be yours.