• rxstocktrading

What Type of Trader Are You?

Updated: Sep 13, 2021

Do you want to be a sniper trader and enter at the lows and sell at the highs?

Do you want to hold multiple 10 baggers (1000% gains) on life-changing stocks?

Chances are it will be extremely difficult or nearly impossible to have both.

To discover what type of trader you are means you have to really do some self-reflection and get in touch with your personality. There is a big difference between what you want to be vs what you actually are. We could spend hours talking about psychological makings and past experiences and how they shaped us to be who we are. But the goal, for now, is to focus on the type of trader you want to be.

To become a successful investor we have to find an approach that fits with our own identity. One problem that happens often is traders who first get into trading when they are young want the get rich fast method. They rather Yolo into a weekly call option than dedicate time and effort to learning the basics of stocks. Just like any other business, there are no shortcuts in trading. You have to be honest with yourself before you can find the best trading strategy for yourself.

However many people do not have the self-awareness yet to even ask the question: Who am I?

Here are some sample questions to get you started:

What hurts more?

  • Selling a stock that is up 10% and then watch it go up another 50% without you?

  • Having a 10% gain in a stock and then ending up holding it too long and end up with a loss of 8%?

Do you have the time to monitor your stocks during trading hours and make quick decisions?

Do news headlines ever cause you to panic and want to take quick action?

Do you avoid looking at your losing trades?

Are you okay with missing big winners while you wait for your stocks to develop? Or would you rather move to new opportunities when they present themselves?

Are you normally a disciplined person or do you like to follow your emotions and listen to your gut?

Do you enjoy doing research into companies? Do you just care about making money or is the research fun?

Do you like to understand why things work? Or do you just accept they work and move on?

Do you hate it when you are wrong about something? Do you ever pretend to know something that you don’t?

These are some questions to get you started thinking about who you are and what type of trader you might be. Figuring out who you are is the first step to becoming a profitable trader. The next step is finding a mentor who has been there through the process and can really show you the way.

Can you do it on your own? Of course, you can but it will take much longer and you may end up giving up on the way if the frustration overpowers your dream and desires. Are you willing to go through countless mistakes and failures to hopefully find the right way to trade? Do you have enough capital to handle years of being inconsistent?

Trading is a journey that everyone has to go on. Do you want to have a map to help guide you or do you want to try to explore yourself?

These are some very important questions for any trader to ask themselves first.

Thank you for reading and good luck becoming the best version of yourself.

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