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Step 2: Change how we approach trading
This is a series. Read the previous articles before continuing.
We have all heard "think of day trading as a business". But what does that really mean? Most people who become day traders have never run their own business before. Just like any career or skill that we have mastered in the past, we have to put in the necessary preparation time. This involves analysis, homework, practice, refining a strategy, developing a business plan, and making the necessary adjustments, just to mention a few.
Next, it is very important to keep your job description in mind: During the trading session, you are the lead trader of your business and all you have to do to keep your job is to follow the trading rules. It’s that simple. In order to stick to a set of rules pretend, if you need to, that your boss just handed you the rules and said, “Trade only by these rules and that’s it. Win or lose, if you follow these rules, you get to keep your job and receive a paycheck.” If you focus only on following the rules and not on the money, the paycheck will follow, and you won’t be distracted by unproductive emotions. Accounting, planning, testing new ideas, or anything that is not directly related to winning trades, can wait until after the trading session.
So we have discussed how important it is to trade as a business. Before moving on to step 3, Create a business name for your trading business. Take some time to create a name that reflects who you are as a trader. If you want to take it a step further, Create a logo! Once you have done this you may move on to the third and final step.