Trading Beliefs Realisation

The Belief Mechanism of Winning Traders

A Set of Beliefs

Last week I recorded a new podcast episode: The Belief Mechanism of Winning Traders

And I’ll admit, it wasn’t as concise as I’d like… But… the concept is important, so I uploaded it.

I realised something:

Every single successful trader I know has a set of beliefs. Whether that’s about the market or themselves. They believe it and that guides every single trading decision. It gives them the confidence to take a trade and hold a trade.

And if you think about beliefs in general. They very rarely change, so you feel comfortable making decisions using those as your anchor.

  • If you believe that your best trades go your way immediately then you’re going to pull your stop to break even.
  • If you believe that markets always mean revert then you’re going to become an expert at finding those turning points.
  • If you believe you’ll always recover from drawdown then you’re going to be unfazed by a string of losers.
  • If you believe you should be taking small and regular profits from the market then closing the trade at the next key level is the easy decision.

You get the idea.

New and developing traders don’t have beliefs yet. They don’t know what’s true for them and what’s not. So it’s tough to make decisions with certainty. Luckily as you grow and get more screentime that changes. 

You start to build a set of (hopefully) positive beliefs that can guide your trading decisions moving forward. Whether those are emotional, operational, or technical.

Today think about your trading beliefs. What do you believe to be true about your trading and the markets? Maybe there’s some in there you hadn’t considered before.

Something to ponder…

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