Chasing the dream of becoming a profitable binary options trader can be obsessive. While this can be a healthy strategy to keep you disciplined and consistent, it can also be a gateway to having unrealistic binary options trading expectations and goals that are not realistic.
As Jesse Livermore mentioned, “the desire for constant action irrespective of underlying conditions is responsible for many losses on Wall Street, even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.” This indicates that your expectations as a trader should align with current market conditions; otherwise, achieving profitability can be grueling.
Why You Should Set Realistic Binary Options Trading Goals
“How can I make 15% profit per day trading binary options?”
Questions similar to these are not new on the internet due to the fact that binary options trading is easy to grasp, set up, and execute. Most newbie traders and non-traders assume that everyone trading binary options is a millionaire. Hence, they opt to be a part of the winning team, coming into the fold with expectations to be profitable and amass wealth overnight. Unfortunately, despite their sincere zeal, most do not meet their set goals, causing disappointment.
Hence, to avoid disappointment and be profitable, you must learn how to control your emotions and have realistic binary options trading expectations. Setting realistic goals will help you stay disciplined and thoughtful when executing your trading strategy.
More so, it’s not uncommon for people with unrealistic expectations to be victims of poor decision-making and excessive risk-taking. This is mostly because they failed to lay a solid foundation and adhere to patience and emotional discipline. Therefore, to drastically reduce poor decision-making, a trader must set realistic goals.
Strategies for Establishing Realistic Trading Goals
Each trader is unique. Consequently, establishing realistic trading goals calls for critical analysis, cautious planning, and patience. You must understand that it takes investing time and resources to become skilled at trading binary options. Thus, it’s only wise that you go the route of “study and test to show thyself approved.” This will equip you with the mindset to start small and continue to grow and develop strategies that will help you psychologically and stay profitable rather than looking for a holy grail of trading that will give you a “sure” 50% per month.
In addition, as a trader, you must always be aware of risk management. Larry Hite, one of the forefathers of systems trading, rightly mentioned, “Throughout my financial career, I have continually witnessed examples of other people that I have known being ruined by a failure to respect risk. If you don’t take a hard look at risk, it will take you.” Based on this, understanding and having risk management strategies like stop-loss orders and take-profit orders can help you establish realistic trading options.
Managing Expectations Along the Trading Journey
A trader’s journey is a roller coaster of highs and lows. Hence, it’s essential to control expectations as you go on the journey. When trading is going well, and you are on a winning streak, you need to resist getting too confident and have discipline in sticking to your trading strategy. Similar to when losing, it’s important to maintain composure and refrain from acting rashly and taking excessive risks due to the present wins.
Setting realistic binary options trading expectations requires ongoing learning, adjusting strategies in response to market realities, patience, emotional discipline, and concentrating on long-term objectives. As a trader, you must learn not to exhaust yourself by constantly switching from one strategy or trading plan to the next, looking for the secret sauce to quick riches. It’s okay to have big dreams, but you must also be grounded and understand that you will most likely not become wealthy overnight.
Frequently Asked Questions
- Can I still make profits even if I don’t meet my realistic goals?
Yes. As long as you don’t lose money, profit is profit. If a strategy meant to give you 15% profit per year gives you 11%, you’re still winning.
- How can I set realistic expectations and goals?
It is quite simple. Pay attention to the current market, mirror the results and expectations of experts in the field project, and learn to manage your money and emotions like trading.