If you’ve just returned from another solar system, you might not know that Leicester City football club won the English Premier League title for the first time in their history in 2016. Starting the season as 5000-1 outsiders, they triumphed over many well known and better funded clubs. I confess that I am not a follower of football. As a Leicester citizen, I couldn’t help but be riveted to the media coverage of this local success story.
So why am I writing about a football success story on a trading website, apart from the fact that Plan B Trading is based in Leicester? I think the undoubted success of Leicester City has many parallels with the trading world. Not least of these is belief. Even if those around them did not believe it was possible to succeed, the team held on to that belief. Their confidence led to many a successful match when pundits would have them in second place. In trading any given strategy, you must have the confidence in the strategy to deliver a result. Hesitation is not a characteristic associated with success.
Another lesson we can learn from Leicester’s football success is the time it takes to become a national phenomenon. This did not happen in a single match any more than a single profitable Forex trade makes a successful trader. We cannot measure success in trading in a single trade. During the football season, Leicester did take some losses – not too many as it happens. There were quite a few matches they did not win. Did they let this affect their next game, or did they just train harder? By the end of the season, they had many more points than any other team.
As a trader, you must not allow your mindset and confidence to be wrecked by a losing trade or a run of non-profitable trades. You need to cope and not carry this negativity into your next trade. This might mean cooling off by staying out of the market for a period of time. Or reducing your exposure until your confidence returns. Or it might mean spending some time with your coach or mentor revisiting some of the basics. At the end of the day, you must measure your trading success over the longer term and not a trade by trade basis.