What do professional traders do differently?

In this post, I’m going to get to the bottom of the elementary question “What do pro traders do differently than beginners?” and provide you with some important tips.

Am I a professional if I spend 10 hours a day in front of the screen? Or if I managed not to decimate my account within a year?

Am I a professional trader if I publish daily forecasts on the XAUUSD without ever implementing my opinion in a trade?

At this point, more than a dozen (rhetorical) questions can be asked, the answers to which deserve a “no” in my opinion.

The career of a trader

As trading beginners, we start the first purchases with an enormous euphoria and realize what a great invention the leverage of a derivative is.

After the first winning trades, we start extrapolating the increased portfolio value on an annual and 5-year basis. We dream of luxury cars and a house in the south of France. A few trades a day and then off to the beach. Being a trader is the coolest job in the world!

Weeks later, the initial euphoria is somewhat dampened. The previously (accidentally) achieved profits have been almost eaten up by the losses incurred and the trader is back at the beginning or even close to exit.

From now on, we look for “safe” strategies and deal with chart techniques, Expert Advisors and setups of other traders. In addition, we visit countless webinars and devour one textbook after another. At that point you realize how conceptless the first weeks/months were traded.

Despite the acquired knowledge, trading does not get better. The losses exceed the profits and so slowly the luxury finca moves into the far distance.

The carefree nature of the first hours has completely evaporated. Instead, we now sit even longer at the screen and fever with every trade. In the meantime, we have learned to develop our own setup or trading schedule.

Every now and then we notice that, in retrospect, we didn’t really want to enter trades at all. They do not fit at all to the favored setup and nevertheless we have made the trade.

The decisive turnaround

After months or years of unsuccessful trading, most traders realize that they have gained a lot of experience about markets, economics, charting and correlations, but the implementation does not really want to succeed.

Our own psyche plays tricks on us again and again and makes us stay in front of the computer hour after hour as if in a trance. Who is actually in control of whom? The chart the trader or vice versa?

Up to this point, one can state that today’s professionals have also experienced this rocky road in the same or at least a similar way.

I didn’t want to believe it myself at the beginning, but these nerve-wracking experiences with emotional roller coaster rides, depot scraps and fits of raving madness must have been experienced by each of us once to reach the next level.

At this crucial point, we are all at the stage where we have accumulated sufficient (or too much) expertise, but are constantly being led by our emotions to make curious decisions.

To reach the next level, we must become aware of these mistakes and act accordingly! We need to recognize where the fault lies and take action to stop this misbehavior.

In other words, a professional has managed to stubbornly and constantly follow through with his trading plan. He knows exactly that this setup leads to sustainable success because he has tested it countless times.

Even if he has made 5 minus trades in a row, this negative series leaves him cold and he looks forward to the next entry. The professional does not become exuberantly emotional or restless when the stop price is getting closer and closer.

Likewise, he does not feel the urge to want to make up for the loss immediately after a minus trade and blindly open a new trade. He has the necessary humility before the market and knows that losses belong to trading like the cathedral to Cologne.

The professional trader has a system that he follows through every day – he has created duplicability and consistency in his trades and behavior.

Of course, the difference between beginner, advanced and professional can also be measured in money. If you have managed to move your account from e.g. 5,000 EUR to 50,000 EUR over a longer period of time, you are probably on the right track. But there is no fixed limit that can be approached and exceeded. Who generally trades sustainably profitable (I am talking about years and not just a few months), can probably be called a professional.

But: It is not only about account balances but also about how this growth was achieved. A reasonable risk management with low portfolio volatility and manageable leverage is equally important.

Professional traders know that account protection comes first. Even more so when investors with outside capital are involved.

Conclusion:

The step from advanced to professional is usually taken when the trader becomes aware of dealing with his own ego. He does not deal with the 10th super indicator but with his own psyche and takes measures to control his emotions.

The professional trader is a balanced person, at peace with himself and consciously paying attention to a healthy lifestyle.

Thus, it can be stated that there are long and difficult times that must be mastered in the training of a trader. The wheat is separated from the chaff only when one’s own behavior patterns are correctly reflected and worked on.

Finally, I would not like to deprive you of a sentence that was formative for me:

“Professional traders no longer find anything exciting about stock market trading. They already tend to get bored – and that’s where the key lies.”