The main reason why so many options traders lose money is that they do not realize that their problems are internal. Trading is more psychology rather then methodology. The way you trade reflects on your personality and your beliefs which can surface to become your trading problem.

Making money is the main objective and reason for you to trade options, but when you become too obsessed in making money alone, the emotional implications and pressures from the money making part can very often will lead to losses.

All of us want to win and refuse to accept losses, avoiding the emotional pain if possible. As an options trader, you are constantly confronting with losing trades which creates an internal challenge of self esteem because it feels good when you are right.

When you are on a losing streak, you are putting yourself under pressure and you are psychologically in pain and the only way to remove it is to stop trading. Some may sabotage yourself by blowing out your trading account intentionally without even knowing it because when there is no more money in your trading account you will be forced to seize trading.

Do not get over excited after returning from a weekend options trading course thinking that you are able to become a millionaire in a very short period of time. The trainer may have implanted the “Big Headed Syndrome” in options trading into your head by giving you a false indication of getting rich with options.

The quest in becoming a successful options trader requires you to know and understand the method of trading options that are being taught to you. Its strengths and weaknesses, what are the limitations and if it is really so easy to get rich by trading options then every trader can be as rich as Warren Buffett or George Soros.

Statistics have shown that 90% of options traders lose money. Why? They probably share the same thoughts, same misconceptions or even make the same mistakes. Logically speaking, we all must aim to be the 10% traders who make money consistently in trading.

These 10% winners doesn’t compete with the markets, whether they win or lose money, they are honest and truthful to themselves and accepting all the responsibilities of their actions. They know that losing is part of the process in the course of doing business and they do not make it personal.

They are not controlled by the money emotions and they only respond and react to the market conditions as it is. They do not predict the future and will not try to beat the markets, accepting the fact that anything can happen.

You are fully responsible for all your actions as no one force you into it and all the trades are entered by you. You must understand that only when you are truthful to yourself and accept the responsibility of all your losses then you are ready to learn from your mistakes.

“Your ultimate success or failure will depend on your ability to ignore the worries of the world long enough to allow your investments to succeed. It isn’t the head but the stomach that determines the fate of the stock-picker” – Peter Lynch

Popularity: 34% [?]

Don't want to miss a thing? Subscribe to my RSS feed!




You Should Also Check Out This Post:

More Active Posts: