A lot of folks who plan on having a winning trading career wind up losing money. This is in spite of the presence of many reliable share trading education businesses, the availability of numerous trading books providing investment tips, and the occurrence of sound trading rules which have withstood the test of time. These rules are not covert-nearly any book will reference at least some of them. But even with all this, countless individuals still find it hard to attain trade profits in the long term.

What is the notable difference between those traders who succeed at this activity and those whose efforts end in failure? Experts in the field will tell you that it is all a matter of psychological differences. What this boils down to is that you have to be able to deal sensibly with both winning and losing, with downs as well as ups. You must be able to cope well with managing your risks and not let greed get the best of you. These are all elements of what is referred to as trading psychology. Many columns and volumes have been penned on this topic, so we will not go on further about it with the exception of one important area.

Of all the stock investment advice I have ever understood, the most crucial can be explained like this… Something that a lot of folks struggle to conquer is their anticipations in terms of trading. Excessive numbers of people possess expectations that aren’t grounded in reality, thinking they’ll earn massive trading profits as a rule, for instance.

Having high expectations of yourself is a good thing however, unrealistic expectations is not. Many traders when presented with the wonderful opportunities that the market offers to achieve successful trading results, can be very easily led to setting unrealistic goals for their trading. This can be devastating.

When one ventures out into gatherings of traders, it is amusing to listen to those who claim anything less than doubling or tripling their cash is not worth their time or effort.  These foolhardy individuals will not even listen to the rock solid plan that can guarantee a 25 – 35% annual return on investment.

Sadly for such individuals, they do not have truly realistic expectations. Sometimes they will lose on several consecutive investments and they simply will not be able to get back up, dust themselves off, and start all over again. Due to their inflated expectations, once they’ve lost a bit of their money they’ll begin to make trades that are far too risky in hopes of rapidly recouping what they have lost and achieving their unrealistic aims.

An additional dilemma that some traders face is that even when their goals are a more realistic 20% annually, for instance, they think they will attain that return in only the first few weeks instead of taking a longer term look over the 12 months. Twenty percent annually is merely a bit more than 1.5% monthly but some traders might anticipate attaining that rapidly and might espouse some of the bad habits like the ones described previously.

Ray has found that a winning approach is only one component of trading success. In addition, traders need skills in market profiling and money management. They need to master the psychology of trading success by understanding what motivates them and coming to terms with what scares them.