There have been various assumptions such as Mathematical knowledge an engineering degree or a financial background to become a successful trader.
We shall look into the skill sets required to become a successful trader in the industry.
The first and foremost skill a trader should possess is the quest for collecting the right information and data relevant for the securities / commodities that they wish to trade and examine the same.
Create and list out the economic releases and the fundamental aspects which could have an impact on the financial markets.
By being aware of such events, the traders can react to new information rather than digesting it. Research is the lifeline of trading as it prepares a trader to take the next step.
The ability to analyse the data quickly is very important as a trader. There are a lot of calculations involved in trading. It is not necessary that one has to be an expert in maths, but it is necessary to possess basic analytical knowledge as a trader.
Trading involves charts as representations of the market movement with indicators. Hence a trader requires understanding and analysing the technical chart.
Developing this skill would enable the trader to take calculative risks by recognizing the market trends
As trading is carried out in various stocks / commodities, it is necessary that the trader focuses and aims on the important and actionable data that will affect their data.
Focus is a skill and it increases the more traders exercise it. As there is so much financial information out there, traders need to be able to polish in on the important, actionable data that will affect their trades.
Some traders also focus in on the types of securities / various scrips of commodities they trade so they can deepen their understanding of a specific sector, industry or currency to the point where it becomes a competitive advantage against less specialized traders
Organise is supported by focus. The market is likely to get highly volatile based on market conditions. A trader has to control their emotions and be organized by following a trading plan and strategy that is well suited.
Adopting different methodologies and following the strategy of other traders would result in loss. This is especially important in managing risk by using stop losses or taking profits at set points.
Many strategies are designed so the trader loses a little in bad trades and systematically gains more on good trades. When traders start to get emotional about their trades - good or bad - strategy goes out the window.
If a trader records the results of his or her trades meticulously, then improving is simply a matter of testing and fine-tuning strategies to find a successful one.
Record keeping is one of the most important keys to trading. The advantages can be exercised in due course of trading.
It is hard to show real progress if you are keeping accurate records
Skills are learned. With a bit of effort, traders can improve their analytical skill, research abilities, focus, organize and record keeping. The investment of time and energy will pay off in better trades.