One of the first steps to overcoming our weaknesses is identifying them. How many times do you look at a person and realize that they have no idea what their weaknesses are? In truth, many times you can actually use your weaknesses to your advantage if you’re honest about what they are in the first place. For example, if you’re impatient, find a way that you can use your impatience to benefit your trading. But you can’t do this, unless you identify your impatience in the first place.
Turning Your Weakness into Your Strength
If we acknowledge the fact that our personality is one of the biggest contributing factors to the success or failure of our trading, we’ll put the effort into helping our personality work in our favor. Unfortunately, we all know how hard it is to change your personality. But what if we told you that you don’t have to change it – you just need to redirect it? Identify your weaknesses and then turn them around so that they can be used as strengths. Using the example of impatience that we mentioned above, if you identify that you are too impatient to sit in front of your screen all day waiting for a trade, then you’ll stop doing that. You’ll find a way to trade that doesn’t require hours of patience and will likely become more successful. Follow these steps:
- Identify your weaknesses – be honest with yourself!
- Identify your strengths that can counteract those weaknesses
- Find a way to use your weakness as an advantage for trading
- Put it to action
Common Weaknesses When it Comes to Trading
Many people find this exercise difficult. They find it hard to identify their weaknesses, but without doing this, they can’t improve their trading. Here we’ll look at some of the most common weaknesses when it comes to trading.
- Over-trading – Many people find it hard to stop when it comes to trading and this is commonly due to impatience. They feel that the more they trade, the better they’ll do. More often than not, this results in chases losses, stress, and then more losses. Waiting for the ideal trade may mean that you’re trading much less often, but it means that your success rates will be much higher.
- Poor risk management – Part of trading successfully is to be able to manage your risk effectively. If you’re not able to do this, you’ll end up trading by fear or anxiety which will likely lead to failure.
- Fear of failure – Everyone wants to have winning trades all the time, but it’s important to realize that this is unlikely. Even pros lose trades. The key is to appreciate that not every trade will win. This will prevent you from chasing your losses which more often than not, leads to more losses.
The Bottom Line
Part of becoming a successful trader is to understand your trading personality and how you can use it to your advantage. Even your weaknesses can be used to your advantage if you identify and understand them.