By Sam Evans, Co-Founder and CEO
The two questions I get asked most often are “how much can I earn from trading?” and “what does it take to become a skillful trader?” First, let’s address the earning question. There is no true answer to this question. What you can and will earn depends on many factors, and one of those is knowing how to trade. The first reason I love trading is that there’s no real limit to what you can earn.
So, let’s say you do become a skillful trader, and we go back to the question of earnings. Again, that’s up to you. Some people dream of making tens of thousands of dollars. Others dream of earning enough to change careers, pay off a mortgage, supplement their retirement, or have more freedom to live the way they want. We all have different reasons, and therefore, we all have different earning goals.
The Path To Becoming A Skillful Trader
The second reason I love trading is that you can become a consistently profitable trader if you can master just one skill. That one skill is the same skill that you can use to make $10, $100, $100, or $1,000. The hard part is not increasing the amount you make per day or week. The hard part is mastering that one skill.
Focus On Mastering One Skill At A Time
Don’t be afraid to be boring. Focus on learning one trading skill at a time. If you’ve ever listened to my show TakeStock Live you know that I trade multiple asset classes and employ different trading styles to suit the current market conditions. But that’s me.
The issue is this. If you try to learn everything at once, you won’t learn anything. You have to develop one skill and then wash, rinse, repeat over and over again. Once you master one skill, you can build on it.
Lay The Foundations And Then Build On Them
Once you master one skill, you can build on it. That could be diversifying by learning how to trade additional asset classes or learning a different strategy. The idea is that you always have something in your bag for the various market conditions that can happen and gives you more trading opportunities.
I am a Futures trader at heart. I love trading the Futures market, but I also trade options. Why? Because sometimes the markets can give me more trading options.
Don’t Aim To Hit Home Runs With Every Trade
One of the problems I often see, especially in the day trading community, is aiming for huge trades all the time. That’s not a profitable strategy. At StockAbility™, one of the things we teach is how to grab the low-hanging fruit. When it comes to day-trading, we are all about getting in and getting out. The aim is for consistency and profitability.
It’s challenging to hit massive trades without building up a series of minor losses. They may seem negligible, but what they do is stop your progress. These little losses lead to frustration and deviating from your plan.
I have seen many people that could be profitable fail at becoming so, not through lack of opportunity but by always wanting more—wanting that big trade rather than taking the smaller trades.
Play To Your Strengths
Another factor in becoming consistent is recognizing what you are good at. Coach Ryan Watkins covers this well in his article, finding the trading style that suits you. He gives an example of someone who says: “Ryan, when I day trade, I lose a lot of money, and I am inconsistent, but when I swing trade and do really well, what should I do?”
Do you see the answer to the question? It seems obvious, doesn’t it? That person should focus on swing trading and stop day trading. However, when you get in the weeds, or you’ve spent so much time trying to make something work, or have a conceived notion, it’s hard to let go. It can feel like giving up.
As Ryan says, “Any good business owner will tell you, sometimes you need to “pivot” the business to make it work. It is no different in trading. We need to find what works and what does not work.”
By learning one skill, one asset class, and practicing it, we discover what we are good at and what we aren’t good at. We systemically build on our skillset and become skillful, profitable traders in the process.
It’s OK To Focus On Just One Skill
Remember when I said that I love that making $100 or making $1000 is all down to the same skill, and here I am going on about learning more than one skill and focusing on what you are good at. At StockAbility™, we teach several different methodologies. You can master one of them or all of them. The point is to master one skill rather than learning a hundred different things, and nothing ends up working.
Mastering more than one style of trading will give you more options. However, there is nothing wrong with being happy, just trading one thing or one way. The goal is to be profitable, and it may just be that you are suited to one style of trading.
Who cares if you only trade pork bellies for the rest of your life or if you only make money trading gold futures? Becoming a skillful trader is all about leveraging your skillset. If that’s trading Forex, so be it.
There’s no harm in becoming or being a one-trick pony. Maybe you are especially good at breakout trades, or you’re a specialist of something like the Globex Trap. Stick to that and practice.
Learn to Trade Effectively with StockAbility™
At StockAbility™, we have helped people take this step and make leaps in their stock trading abilities. Our experienced professionals, proprietary training techniques, and dedicated community are always there every step of the way in your trading journey.
To learn more check out out our programs and then sign up for a free webinar.