What is the biggest....?

Question

challenge in trading for a living?

Answer 1

Being very disciplined.

Trade without any emotions

Know what you are doing, how you are going to do it and why you are doing it.

Stay with your trading plan, don't deviate from it.

Answer 2

transaction and infrastructure costs.

if you trade for a living, it's a good idea to have a Bloomberg terminal in your house/office so you have access to everything you need as far as information.

then you should really make sure your other information systems are up to spec - if you don't have a fast enough computer/internet connection, it can be really frustrating when you realize that was the reason you weren't able to get a trade executed at a better price.

then you need to make sure your broker isn't killing you with fees and poor execution. if they have a screener or something that you prefer to the Bloomberg (hard to imagine, personally), so much the better.

then there's the irregular cash flow.  this can be a real killer.  you can go from making money hand over fist one month, to losing money just as quickly the next month.  make sure you have sufficient capital, and a personal fund on top of that to get you through any rough patches - getting kicked out of your apartment because you're on a cold streak would really suck.

Answer 3

being consistent with earning and not having emotion when trading....numbers don't have feelings, and you do.

Answer 4

The biggest challenge in being a successful and consistent trader in the stock market is overcoming your own emotions.  Market technique and knowledge alone will not lead to making big profits in the stock market.  However, understanding your own perceptions of the stock market as vehicle out of the rat race is.

Will you develop a trade plan which clearly sets out what types of trades you will execute.  Or will you be following the latest and greatest guru which his/her can't live without technical indicators.  Will you hold a vendetta every time a trade goes against you or just realize that the stock market is a stream of data giving opportunities each and everyday.

Successful traders create routines/checklists which are different facets of their trade plan in action.  These rules allow them to let their winning trades run for big profit and cut their losers.  Traders making money in the market realize that exiting a trade for a small loss doesnt mean they are wrong or a loser.  It simply means this trade based upon our rules didnt work out; however, they are ready to take advantage of the next opportunity.

So, are you ready to overcome your biggest obstacle to being a successful traders?  Are you ready to overcome yourself?