Thursday Trader's Tip: Longevity
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Welcome to Thursday Trader's Tip — the free edition of The High-Performing Trader newsletter. Each issue presents to-the-point trading psychology advice that can be read in under 5 min.
This week's post is about the longevity of your trading account.
In trading, in the middle of the sea of best practices and methods, two fundamental rules stand out and should be your allies throughout your whole trading career. They are:
Believe in yourself
Always live for another day
In last Thursday's Trader’s Tip, we discussed self-belief. Today, we’ll talk about the second rule — always make sure to survive for another day.
Rule #2: Always Live for Another Day
Trading success requires a mindset that prioritizes longevity over instant gratification. But long-term, probabilistic thinking doesn’t come naturally to us so we need to be constantly reminded of it.
Your day-to-day moves in the market should align with your trading mission. Just like in any business, when employees understand the company’s mission, they act accordingly. Don’t let the impulses guide your behavior, make sure to create a defined long-term vision and always have it fresh in mind. Looking at it before you start each session helps you reconnect with what truly matters and execute accordingly.
Never let a bad day put you out of the game.
Your number one priority should be looking after the overall health of your trading account. Here are two action plans that will help you live for another day:
Become an expert in measuring your emotional temperature:
Most mistakes happen out of a lack of self-awareness — traders let the emotional temperature rise without conscious thought until it’s too late. If you can raise awareness at an early stage, you are better prepared to perform. Just like everything, this is something you can practice, so don’t limit yourself to the charts, start developing your self-awareness off-charts.
When facing a drawdown, don't go down the reckless road:
You might think "Well, if I'm already in a rut, might as well oversize and go careless" Instead, flip the script. Consider it as a chance to prove to yourself that if you handle this drawdown with discipline, you can pretty much handle anything you set your mind to. Tough times offer you an opportunity for growth, more than easy times. Use them to build up the kind of confidence that makes you unstoppable.
Enter your sessions with your priorities in the right place and in case things slip out of your control, remember you still have the choice in your hands.
Happy trading,
Sara
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Yes live another day. That’s a good practice to remind yourself of the long-term vision. My pulse is always higher once a trade starts, so I don’t look out for that as much more the thinking process as the session progresses. I like that “if you can handle a drawdown with discipline, then you can handle anything”. The attitude during that period makes or breaks you