Patience is Virtue – Avoid these Binary Options Trading Traps!
Patience is Virtue, Binary Options trading is known for being quick but it doesn’t mean making hasty decisions. Impatience leads right into a trap.
Binary Options trading is a fast paced business. You can trade expiries as short as 30 seconds not to mention all the ads that focus on how fast you can make money! But no matter the expiry time, patience is a quality any kind of trader can benefit from. It might sound obvious for some of you but being patient has a huge impact on your trading. Greed, losses and waiting for a decent trading setup are some examples of what can lead to what I call “impatience traps”. It takes time getting skilled enough to become a real patient trader but you can start by learning about what patience is, how it relates to trading and what I call “impatience traps”.
- Patience – the capacity to accept or tolerate delay, trouble, or suffering without getting angry or upset.
- Patient – able to accept or tolerate delays, problems, or suffering without becoming annoyed or anxious
These are two words that every trader must know, understand and live by. These two words are the heart and soul of trading, binary or not. Investors, traders, speculators and scalpers all have rules that they live by, they have a trading strategy. Their strategies tell them to wait for a set of pre-set conditions before buying or selling you position. Patience is the ability to wait for those conditions to occur, without getting angry, annoyed, upset or frustrated. If you can’t do this then these things lead to impatience and impatience leads to loss.
Frustration Leads to Making Hasty Decisions
When everything is going well for you, self-control is the easiest thing to master! It’s only when the shit hits the fan that you really find out how controlled and patient you can remain. In binary options trading, when things go bad it often means losing trades. Being impatient can quickly turn one or two losses into the famous and loooong losing streak that we all hate. If you can’t take a loss and deal with it and you are easily frustrated it is very easy to compounding mistake after mistake. Accepting losses are part of being a patient trader, it sucks to lose but making hasty decisions, trying to make it back real fast, will only make things worse. You’ll end up taking one bad trade after another and it feeds your anger and frustration. If you hear yourself talking out loud furiously and swearing I think that’s the stop sign, shut it down, go take a walk or watch a movie or do anything but trading! It happens to me from time to time. Know when to throw in the towel. Instead of going all crazy, take a step back, cool down and learn from your mistakes.
Fear & Greed
Making your account grow takes time and needs a sound money management. Money management in turn only works if the trader is patient because you are making only small trades. The slow progress your account makes when you risk less than 5% of your total balance can seem painful so it’s wise to postpone your plans for buying a Lamborghini . I understand that it can be frustrating but if you don’t want to accept a bit of a delay you’ll have to more ready than most to deal with fear and greed.
Fear and greed are like a couple, not a lovely one though… They whisper in your ear like a pair of mischief makers sitting on your shoulders. Usually you will be introduced to greed first, she is charming, makes lots of promises and all you need to do is to follow her advice. Of course this means making bigger investments than you should, maybe trading before the signal is fully there. I can hear her whispering in my ear now “think about how much more you can make in the next trade if you risk 20% of your account!” That’s greed whispering in your years. It’s all glamorous and exciting until you start losing. That’s when fear introduces himself. Fear will affect every single decision that you make from that point on. Fear will take control of your next trade, your investment size and make you so desperate you’ll do anything.
Patience Pays Off!
Patience does pay, in cash actually, by not letting you lose too much money and by keeping you in the best trades. In fact, you’ll end up earning more money if you are more patient. This is because, by definition, patience is the root of all trading strategies. Being patient means to wait for the proper conditions to be met before acting, without allowing emotions to take over. Just like in a strategy. Waiting for the proper conditions to be met before pulling the trigger on a trade. Patience means waiting without getting frustrated. It’s almost funny, in order to master self-control you need to be patient and self control means you are patient. Yes, learning to be patient requires patience! Trading is indeed a time-consuming process and making money takes time,even if you trade 60 second options. There are some methods for finding and eliminating whatever that leads to your impatience. One way that is also very relevant to trading is keeping a trading journal.