“What makes a good trader?” A question often thrown around Wall Street.
A portfolio full of high returns? Nerves of steel? Self-discipline? Luck?
Successful trader Yordan Dachkov believes those who are willing to work harder than those around them are the ones that will get the better results.
According to Mr Dachkov, in the trading game, developing your skill set is not an option. Traders can boost their profits with more expertise in any market.
Here are his five ways to becoming a better trader:
Read, Read, Read
The best resource for developing your trading skills is to read up on it. This could be borrowing books from your local library, purchasing books from Amazon, reading blogs and websites on the internet. Some books I’d recommend are: Trade Your Way To Financial Freedom by Dr. Van Tharp, Mastering the Trade by John Carter and Market Wizards by Jack Schwager.
You may find brokers and trading platforms that offer free webinars. Alternatively, experts such as myself deliver them from time to time for a set fee. These can be in classrooms, via Skype or Google+ Hangouts among other methods. Here you will learn vital skills that you may not have learned elsewhere, taken years to learn or may have only learned too late. These are great for traders to learn tips that will boost their returns.
Open Source Finance Courses
Having a strong background in finance is a great advantage for becoming a better trader. You have no excuses for not learning how the market works. There are online courses all across the world, some of them free, including some of the world’s best universities offering these courses. Education websites such as Coursera and MIT OpenCourseWare are revolutionising the opportunity for people all over the world to have a top class education via the internet.
Learn Everything about Specific Stocks
Top traders choose only a handful of stocks to follow and learn everything there is to learn about them. Management, products, strategy, financial statements and risk factors all included. The company annual reports and filings means you can access this information for free.
The majority of the major brokers offer free ‘paper trading’, which is stock trading simulation. Head over to http://www.etxcapital.co.uk/ for a good example of this. It looks and feels like a portfolio but at the end of the day the users are only trading fake money.
Managing a portfolio without needing to risk any money allows you to test new techniques and develop confidence in your trading.