11 Habits of disciplined

Trader
There are so many traders around the world but few are
successful. Why not all are successful? Whats there in them that all
other traders dont have? Is there anything that others dont have?
Are they all born lucky? They get some inside information from
companies? Or they all have born millionaires? Whats this?
They are not born lucky neither they get inside information
from any companies nor do they have something special in them,
neither they all born millionaires. They are just like us, just a human
being. Then whats there in them that make them successful? Here
is the simple answer. They have their habits or rules or trading
techniques, that makes him successful trader. Here I am going to
describe their 11 habits or rules that make them successful.
Objective
Suitable Trading System
Make a plan and execute
Position Sizing
Willingness to accept loss
Records of trades
Responsibility of your trades
Learning attitude
Believe in yourself
Review the trading system
Playing like Sports

Objective

You have your clear defined goal or purpose. How much risk
you are going to take and how much earning you are expected?
Your object should be clear and written on paper or somewhere
else where you can read your object or goal on daily basis and on
that basis you can trade in the market. Till the time your object or
goal is not clear you cannot be a great trader or successful trader.
So, to be a successful trader or to be a great trader your object or
goal should be clear.

Suitable Trading System

After your object or goal is clear you have to go for Suitable
Trading System. Some are long term, short term, medium term,
arbitrage, momentum, day trader etc. From this you have to choose
as per your personality. Your personality means how much loss you
afford, or on some day market goes down unexpectedly and your
portfolio value goes down by 40 to 50%, are you be able to bare
this much of loss? If you buy any stock and its not giving any
movement for some time or for 3-4 months are you be able to hold
the position for long time? So, these are the factors you have to
consider when choosing your trading system. Too many traders are
hungers to earn money in short term and they follow the latest
trend of Day Trading. But this system not suit for all the traders. To
be a successful day trader you have to adjust short term up and
down of the market during the day. You have that discipline and
ability to handle the stress during day trading.
Yes, there are number of traders making handsome money during
day trading. Here I would like to give example of day trader who
made handsome money in day trading and from that hard earn
money he become a main broker of NSE.

He has his own trading system. Hes coming at his office at around
12 noon, watching market for an hour, and around 1.30 pm he
enters his 1 st trade. He only works in Index stocks and in quantity.
He starts squaring his positions after 3.15 pm.
But this trading system is suitable for him but we cannot say that,
the trading system he follows suits all the day traders. So, there are
different style of trading systems for different traders.

Make a Plan and Execute

No trader will be surviving if they dont go thru the plan they
made. If you have no discipline to follow your plan, then there is no
need to made. A plan provides, what to do in unforeseen event.
But its only work when you are ready to follow your plan. Once you
trade then there is no point of thinking that where the price going.
Think of what you are going to do when price trigger your target or
hitting the stop loss? If you are taking your decision what to do
when price trigger your target or hitting the stop loss, then you are
not emotional and stress free. You also have to plan for unforeseen
event like Company Result, RBI Credit Polity, Election, terrorist
attacks, inflation figure, IIP figure etc. When any of this events occur
markets volatility is very high and stock price goes ups or down
drastically. So, every trader has to be prepare himself for this type
of events.

Position Sizing
Position sizing is the most important tool for Successful
trader. Position sizing means how much you are risking on each
stock you are investing. So, that you can achieve your goal.
It is based on historical performance of your trading system
for the current market scenario.
Position Sizing means:

if you have fund of INR 25,00,000/- and you are ready to take
risk of 1% of the fund. i.e. INR 25,000/-, stock price is INR 125/- on
which you make a stop loss of 10% so, here how much share you
can buy?
First divide 100 with stop loss i.e. 10% it comes 100/10 = 10
Here you are taking risk of 1% of INR 25,00,000/- i.e. INR
25000
So, total stock value is INR 25000*10 = INR 2,50,000
Total shares buy = 2,50,000/125 = 2000 Shares

Willingness to Accept Loss

You have willingness to accept the loss, loss does not make
you loser but if you ready to accept the loss then only you can trade
in real market. Trader makes loss because when price trigger the
stop loss trader think that may be price reverse from here so, he
doubles the position over there instead of stop loss order to
trigger. Sometimes he waits for reversal of market and in that
trader making a big loss. Traders have to take losses as feedback.
So, on that basis in future he can take proper decision about hold
the position if stop loss trigger or cut the position after stop loss
trigger, or double the position at stop loss price or cut the position
at stop loss trigger.
So, Feedback works as where you were right and where you
were wrong. So, that you can able to take correct decision.

Records of Trade
You know that how many successful traders records their
trades? You met any successful trader who records their trades?
Records means, traders written their all trades, also note if on that
particular day, if is there any event like RBI credit policy or election
or any companys result etc. so, on later day its easy for him to

compare todays scenario with old data. He also checks that if on

particular day, if he makes any mistake? and what was the result?
So, today when he takes position than he can be prepared for the
worst scenario and also for some fruitful return.
So, if any trader would like to successful trader, he has to
records his all trades with all details.

Responsibility of Your Trades

The successful trader knows every action and every decision
he takes, and he is the only one who is responsible for his action
and decision. Successful trader, for his loss or bad trade, never
going to blame others. When hes taking 100% responsibility for his
trade then there is no place for excuses. You must accept that you
are going to make mistake and from that mistakes you are going to
learn, and never repeat those mistakes in future.
When you already tested your strategy and you are firm that
this strategy will give you good return then there is no need to take
advice from others neither to ask any experts.
When you are fail in your strategy, you have to ask yourself
that, did I follow my rules or strategy?, If answer is yes, then you
have to recheck your strategy, where you were wrong?
And if answer is no, then, you need some discussion with
yourself. You have to ask yourself that why you not follow rules?
And how can you stop yourself for doing this again?

Learning Attitude
On time to time every trader has to upgrade their knowledge,
because every day there is something new coming in the market.

Either new strategy or Algorithmic trading or equity future arbitrage

or delta hedging etc. etc. till the time traders approach is not
positive towards learning then there is a possibility that trader not
earning as much as he wants. So, learning is important factor in
stock market trader or arbitrager or investor or delta hedger etc.
Sometimes some rules change related to stock market, or
company release their final accounting data. So, you can read it and
understand it where company stands and on that basis you can
able to trade in the market.

Believe in Yourself
You have to believe in your strategy also you have to believe
in yourself. If you believe in your strategy and you can take entry as
per your system and exit as per your system, then you get success.
If you are not believing in your strategy and discipline, then there is
a chance of losing hard earn money that you earn earlier. For
successful trader their rules and discipline are on priority and the
monetary rewards is secondary.
your confidence is gain and you can believe in yourself, only
after repetition of your strategy and repetition of your rules and
discipline, extensive back testing of your strategy and self-analysis.
There is a possibility of loss too in the market but its a part of
game. You have to stick to your rules, strategy, discipline, entry
point and exit point. So, you never going to lose more than your
desire loss. If you stick to your rules, strategy and discipline than
this market gives you tone more cash rewards.

Review the Trading System

Every trader has to review his trading system periodically. So,
they can know where hes playing. If trader continuously in loss,
then he has to review his trading system again and reassess himself

because it may be possible that hes not follow his rule sometimes
or sometimes change the strategy too. So, Reviewing the Trading
system is a beneficial to all traders.
if trader trades in software stocks and fundamentals change
to be less favorable towards software stocks, impacting your
performance, then you know early on and youll be in piece.

Playing like Sports

Follow your rules, strategy with complete belief and forget
about everything else. How it is possible? I am telling you. Its too
easy. Use your imagination. Its not your money you are playing but
Its like you playing games. As in sports all points are counted like
winning point and losing point. Just like that you have to have your
all records in which you note down all your favorable trade and all
your unfavorable trade. So, you can know how many times you are
correct and how many times you are wrong. Also you know that in
which situation you were wrong so, whenever that situation or
circumstances comes in to market at least you take some
precautions and you save yourself from big losses. Just like when
favorable situation comes you trade more and you gain more.