5 Requirements to Become a Professional Trader
Everyone who decides to get into the forex business definitely wants to become a professional trader. And because of that, everyone studies diligently, never gets tired of trying and is willing to sacrifice a lot of time, money and energy so that their dreams come true.
A professional trader is a trader who makes trading his main profession or job. In a simple sense, the trader finances his needs from trading results. Which means that the trading profits generated are large enough to meet the necessities of life and are obtained consistently.
Becoming a professional trader is certainly not something easy, but not impossible either. Even though the number of failed traders is quite large, there are always some successful traders. This means that there is hope for everyone to realize their dream of becoming a professional trader.
In this article, we will discuss 5 conditions that must be met if one wants to become a professional trader. The conditions are as follows:
1. Have Sufficient Capital
The main requirement to become a professional trader is to have sufficient capital. The size of capital to be considered “enough” for each person is of course different. But, to measure it, the indicators used are the same, namely the target per period (usually 1 month) and the cost of living in that period.
For example, someone can reach a target of 5% of capital, while trading for a month. And his living expenses for a month are $200. Then the capital that is considered sufficient is $ 4000, because $ 200 = 5% of the capital, so the capital is (100% ÷ 5%) x $ 200 = $ 4000.
Sufficient capital is needed considering that being a professional trader means making trading a profession, where one earns a living from there. And because of that, it is necessary to adjust capital based on the cost of living for a certain period.
2. Can Profit Consistent
Apart from that, a professional trader must also be able to profit consistently. Consistent profit is not determined by transaction per transaction, but rather the accumulation of all transactions over a period. And the period used is free, whether per month or 3 months, 6 months and even per year.
To be able to profit consistently is certainly not easy, there are many factors that must be met by a trader to be able to do this. For example, traders must have a trading method with proven probabilities, so that their transactions can be cumulatively profitable. Apart from that, traders must also manage risk in a disciplined manner, always follow trading rules and so on.
So, it’s not easy, it takes a strong commitment and always consistently learning. Even if it were easy, it is certain that there are many rich people with a trading profession in Indonesia.
3. Make a Trading Plan Before Making Transactions
A professional trader always makes a plan or trading plan before executing it on the market. The trading plan contains price levels for entering the market, profit targets and Stop Loss for exiting the market.
In determining the price level to enter and exit the market, one must carry out an analysis using his own method (which has been tested for probability). Then apply the trading plan to the market, either using pending order facilities, such as buy or sell limits and buy or sell stops, or by executing immediately when price movements reach a predetermined level.
4. Discipline in Executing the Trading Plan
Apart from making a trading plan, professional traders also carry out the trading plan with discipline. This means that there is no intervention when the trading plan has been executed, such as shifting the stop loss, shifting the take profit, closing the position manually before touching the stop loss or take profit level and so on.
Discipline in carrying out a trading plan is important because there is no point in making a trading plan, if it turns out that in the middle of a transaction the plan that was previously made was not used. On the other hand, the impact of intervening in a trading plan can change the probability of a trader’s transaction, because it is no longer in accordance with the method used before.
5. Always Think of Risks Before Profits
Most traders focus more on potential profits when opportunities or signals appear on the market. Unlike professional traders, they always weigh the risks before the potential benefits. Because everyone definitely doesn’t matter if they get unlimited profits. But everyone would be in trouble if they get unlimited losses. Therefore, the disadvantages for professional traders are always considered first.
Of course, in trading the goal is to make a profit. So, it’s very common that most traders only focus on making profits and often neglect that trading can also lose. However, because the forex trading business is very risky, in order to survive, you have to be smart at managing risks.
Summary
So, these 5 things are almost certain to be owned by a professional trader. Therefore, if you want to be like them, then follow what they do. And these 5 things are the first steps that you can try to apply first, before other things that are more complicated.
Can someone quickly become a professional trader by doing these 5 things? Of course not. Even a professional trader doesn’t become a professional overnight or in one go. There is always a long process that must be passed. And because of that, it takes a strong commitment to keep learning and trying, with the hope that one day the dream of becoming a professional trader can come true.
