Have you ever wondered what makes a successful forex trader tick? What separates winning traders from the average trader? Research shows that every successful trader possesses these 5 specific characteristics:

1) Be disciplined
2) persevere
3) Treat trading like a business, not a hobby
4) Be impassive
5) Set goals

Read them, understand them and follow them to help you become a more profitable trader.

1) Be disciplined

Anyone can get lucky and make money in the forex market; however, only the disciplined can earn money consistently over time. Being disciplined is by far the most important factor that determines your success. Every professional trader knows that the trading method or strategy does not determine the success of it. What matters is how you follow the strategy.

Your trading strategy is your compass and it will tell you where to go and how to get there. Do not miss. Don’t trade because you “like” a specific currency, or because you “think” there will be a strong rally in a specific currency. When you start making arbitrary decisions like these, you will lose yourself and start losing money.

Following your system is always your best option. You must have the discipline to follow your strategy even through a series of losses.

2) persevere

Everybody fails. But not everyone knows how to come back from failure. Many successful forex traders today started their trading careers by losing all of their funds. Millions of people are lured into Forex by the promises of easy money, and sadly, most of us who try it lose a great deal of money. So is losing money a prerequisite for success in forex? Of course not.

Most people who lose money will never be successful. They get depressed, discouraged and stop trading immediately. At the other extreme, some people who lose their first $10,000 will borrow another $10,000 and lose it in exactly the same way.

Beginners will lose money; That’s a fact. But not learning from your failures will be your biggest mistake.

Take the opportunity to learn from your mistakes. Did you trade based on emotion? Were you trading on a tip basis? Does your strategy fit current market trends? Did you risk too much money on a trade? Did you misread the charts? Are you impatient? These are the questions you should ask yourself when you fail. But the most important question is this:

Why did I fail?

If you can answer this and learn from it, you will certainly be on your way to becoming a successful forex trader.

3) Treat trading like a business, not a hobby

Let’s face it, not all of us can quit our day jobs and start trading forex full time. Not yet anyway. Professional forex traders are better traders than most people for the simple reason that they spend at least 40 hours a week trading forex or researching the forex market.

Forex trading is a business for professionals. If they lose money trading, they will lose their jobs. That is a very good motivation to be good at what you do. The same attitude should be adopted even if trading is not your full time job. Treat it like a business and not just a hobby. A hobby is something you do for fun in your spare time. A business is an enterprise to make money.

I trade forex to make money, not for fun. I have many other activities that I can do for fun. I enjoy running, traveling, and watching television, none of which will make me any money. In fact, most hobbies will cost you money. Trading shouldn’t cost you money, it should make you money.

If you approach trading as a business, your perspective changes completely. Losing money is not acceptable in a business because if you do it long enough you will be out of business. You will take all possible steps to stop losing money.

A business will not grow by itself. You must spend time learning how to become a profitable business. Use your free time to do some market research, read some good books, and attend training seminars. Stop wasting your time on things that cost you money and start investing your time to learn how to trade properly, which will set you on the path to financial freedom.

“I’ve always believed that if you put in the effort, the results will come. I don’t do things by halves. Because I know that if I do, then I can expect half results.” -Michael Jordan

4) Be impassive

If you’ve ever played poker, you know how high it is to go all-in. Your heart races like there’s no tomorrow, and you hope and pray that the cards will turn out for you. It’s the thrill of knowing that you can double your money in a few moments and also knowing that everything can disappear if things don’t go your way.

This kind of emotion should not exist in your trading at all. If you are a thrill seeker, go skydiving. If you are a gambler, go to a casino. If you’re afraid of losing money, open a savings account.

Successful forex traders don’t let their emotions interfere with their trading. Too often, we let fear, greed, or pride get in the way.

fear

Fear will prevent you from making the right trades and will make you miss out on huge opportunities. Fear comes from lack of knowledge and proper education. You are afraid because you cannot see that a trade is correct, because you do not know what the correct trade looks like. Once you gain the knowledge and training, you can begin to trust your decisions because they are based on facts and not emotions.

Greed

Greed is another emotion that we must overcome to be successful. Many beginners experience “beginners luck” and emerge victorious on their first few trades. They then begin to believe that they should have traded with more money so that their profits would be higher. So, on the next trade, they trade a large sum of money and lose it all. Logic will dictate that they should trade with a smaller amount next time as they now have less capital. Unfortunately, humans are not logical creatures. Our greed takes over and we begin to believe that if we invest more money, we will make up for the amount lost and come out ahead. Unfortunately, this cycle can only continue until you are completely out of money. The worst thing that can happen to a beginner trader is to have a successful first trade.

pride

Pride will get you nowhere fast in forex trading. Pride will prevent you from learning. When you feel like you have nothing more to learn, that’s when you start losing money. Pride is the most difficult obstacle for some to overcome because it is an ingrained part of their personality. However, we can all learn from the hugely successful forex traders who still need to do their research and read to maintain their success.

You can still be happy when trades go your way and sad when they don’t. However, these emotions should not play any role in making your decision for the next trade. Your decisions should be based on logic and facts, not emotions.

5) Set goals

Every trader needs goals to stay on track. It doesn’t really matter what his goals are, but it’s important to write them down. If you don’t write down your goals, you will never know if you have achieved them or not.

Everyone has a different goal when they start trading forex. Some people just want to earn a few extra bucks on side trading; Some people want to earn enough to be able to quit their day job. Some people are tired of the 10% average stock market return and want to put their money to work for them in forex.

Write down these goals and look at them frequently to know if you are on track to reach your goals or not.

Summary

The best way to be successful in trading is to emulate the patterns of successful forex traders. Read, reread and understand these 5 characteristics and apply them to your forex trading career. You will find that you will be more successful when you possess these 5 characteristics.