Confidence is key when it comes to most things in life, but it’s especially essential when it comes to trading. If you’re not confident in a trade you put on, then you’re more likely to make an emotional exit at the first sign of adversity. It only makes sense. If you’re confident and sure of your strategy when you put on a trade, you’ll be more comfortable dealing with some adversity if it comes. Why do I bring this up? What does this have to do with determining whether you’re a self-directed trader or a broker-assisted trader? Well it’s quite simple. Confidence is huge as a trader, but letting that confidence swell up into hubris can lead to your unpleasant downfall. And that unfortunate outcome can be a result of something as simple as thinking you can figure trading out as you go along instead of stacking the deck in your favor from the start.
What do I mean by that last statement? Well I mean that trading isn’t easy. It isn’t like riding a bike where you can just jump on, start pedaling, and end up riding without issue just a few seconds later. Trading is a game of preparation, structure, and most of all, persistence. If you don’t have the first two, then you better have deep pockets because you’re going to be having to persist through many a hardship before the persistence pays off. So then the question becomes, why would anybody go into trading without the necessary preparation and structured plan? Well, you would think they wouldn’t. However, I see trader after trader let their own hubris get the best of them, and they dive in without preparing properly on the front end. Nobody wants to ask for help or explore the options that are out there to assist them in these volatile markets.
A vast majority of people think they’re self-directed traders, when in reality, they would benefit immensely from being a broker-assisted trader.
Having a professional that follows the market every day to bounce ideas off of and learn alongside would not only prepare them for the markets, but ultimately help them develop their own structured trading plan.
Now don’t get me wrong, I know not everybody belongs as a broker-assisted trader. There are those who have been around the markets and cut their teeth over the years learning by working in the industry or getting their start alongside a professional. If you fall into that camp, then great, self-directed trading is most certainly the route for you. However, for the vast majority of people who don’t fall in that camp, don’t you want to be there one day by learning the markets and developing your long term strategy? Well then don’t make the mistake of biting off too much too soon by taking on the markets alone. Tiger Woods, arguably the greatest golfer of all time, started his career working with professional swing coaches. He learned from others who studied the game of golf and knew how it was played. If he had just picked up a golf club and started swinging without ever getting that instruction along the way, then he would never have become the golfer he is today. If you aspire to get to that same level in the trading world, then it’s no different. Don’t let your hubris keep you from accomplishing your trading goals.
