How we can surely get patience in trading

As experienced or beginner traders, we must have seen or heard on several occasions that being patient is a key factor in trading. "Trading is 10% buying, 10% selling and 80% waiting" or "Patience pays the bills” which leads to a search on how we can get patience in trading

When we clearly understand exactly how probability and the law of large numbers works in trading, patience will be easy to grasp and apply In our trading journey because patience is a virtue that is vital to our Trading success

Patience is not only the ability to wait but how we act while waiting

Definition of Patience

It is a person’s ability to wait something out or endure something tedious, without getting riled up

Having patience means you can remain calm, even when you’ve been waiting forever or dealing with something painstakingly slow or trying to teach someone how to do something and they just don’t get it. It involves “acceptance and tolerance,” and is usually easier to have when there’s something in it for you at the end. That could be a goal you’ve been slowly working to achieve, or just lower blood pressure

In trading a lot of patience is required for us to go through the learning curve, wait for a trade opportunity where all our criterias align, to manage our risks and trades because we know and understand the probabilistic expectancy of our strategy over a series of trade sample sizes

Why Is Patience So Important?

• Patience helps us to focus on long term goals; Something we want to do or accomplish in the future. Long-term goals require “patience, time and planning.” They are not something we can do this week or even this year. They are usually at least several years away
• Patience helps us to make more rational choices; The word rational actually means “to think in a reasonable way.” Thus, being reasonable means either having fair, sound judgment or being sensible
• behavior is the cornerstone of rational choice theory; Which states that individuals use rational calculations to make rational choices and achieve outcomes that are aligned with their own personal objectives. These results are also associated with an individual’s best self-interests
• Patience allows us to build our reputation for persistence; Persistence is the ability to stick with something. If you practice the violin for over a year in order to play "Twinkle, Twinkle, Little Star" perfectly, that’s persistence! Persistence can also mean something that lasts for a very long time
• Patience helps to develop a skill set: the knowledge, abilities, and experience needed to perform a job. Specific skill set areas can include trading, human relations, research and planning, accounting, leadership, management, and computer skills
• Better mental health; includes our emotional, psychological, and social well-being. It affects how we think, feel, and act. It also helps determine how we handle stress, relate to others, and make choices
• Better physical health; the ability to perform daily tasks and live comfortably in one’s body’. Physical Health is correlated with Mental Health because good physical health leaves a better personal feeling in the long term
• Patience brings peace; a great way to reduce the stresses of day to day life and help us become calmer, more relaxed person overall. Which can lead to a happier existence. Everyone achieves peace differently, it’s just about finding what works for you and the techniques you respond to best
• Patience is a way to practice faith; trust or believe in something very strongly. This comes from the Old French word feid, meaning “faith, belief, trust, confidence, pledge.”

Patience is a form of wisdom. It shows that we understand and accept the fact that sometimes things must unfold in their own time. When we are supposed to be mad but we choose to understand and move on

Why is Patience the key to success?

Patience puts us in direct control of ourselves. When we are patient, we give ourselves time to choose how to respond to a given event, rather than get emotionally hijacked by our emotions. It allows us to stay organized no matter what is happening

It brings a continued renewal of belief in our desired goals and in the heights we are striving to achieve. When we are patiently hopeful, we have a natural resilience and willingness to keep trying because we trust in the possibility of a good outcome

As we succeed, slowly but surely we come to understand that delay doesn’t equal denial

However, patience is not something we have; it is something we consciously do. And just like any other hard-earned discipline: The more we practice it, the more patient we become

So how do we gain patience in trading?

By having a trading plan accompanied with a "build" rather than "make" mentality

Trading is a game of processes. Over time, having patience will allow us to be successful as it helps our account to grow

Losing patience can cost us a lot of money; It’s true, that the markets can be frustrating, especially when there is a lot of uncertainty every now and then, which can lead traders to lose patience. But that is a classic portfolio killer which often leads to:

• Overtrading, or making way too many trades
• Taking trades with no edge present
• Trading less efficiently than we should

Fortunately for traders, patience is a skill that can be learned. And the more we practice it, the more patient we become. But first, we have to know these three main reasons why traders often lose patience:

• Fear of Missing Out: You hear about others making money and have a compelling fear inside that if you don’t participate now, you’ll miss out on an opportunity to also make money
• Boredom: You get tired of sitting on the sidelines, watching things happen for others. As a trader, you want to participate, and getting involved is an easy thing to do
• Trying to Make up for Previous Losses: We’ve all come through a time where we’ve lost a lot of money in our portfolios. So we’re frustrated and want to make it back as quickly as we lost it

How we can develop patience in trading

i. Have clear realistic long-term objectives for trading; Knowing our why to trading. "Where do you see yourself in the next five years with your trading journey?"

It can be a full-time trader making a career from trading, a second source of income for ourselves, growing a retirement account, pension account or a savings account

ii. Following a structured trading plan; What are supposed to be done, why, when, and how. It covers a trader’s personality, personal expectations, risk management rules, and trading system

When followed, a structured trading plan will help limit trading mistakes and minimize our losses. No matter how good our trading plan is, it won’t work if we don’t follow it

iii. Trading a time-frame that suits our personality; To pick a trading time-frame that suits our natural inclination and mental capacity. If you and your brain operates at a very fast speed, and you like immediate feedback then build your trading system off the lower time-frames

By the way, that doesn’t mean if you like high paced action you should trade the 1 minute charts with no foundation, system, knowledge or experience

iv. Trading a time-frame that suits your skill level combined with your personality; people who love the fast paced action and are just starting out on their trading journey, trading off the 1 min charts from the get go is certainly not the best way to develop your patience

It will be better to trade off the 15 min, the 10 min or the 5min chart to begin with, in order to understand and embed the feeling of patience into our subconsciousness. Once we have that done, then we can incrementally move down the time-frames and continue to hone our skills and patience. This will also have the added benefit of helping us to understand the market structure and price movement in relation to different time-frames

Trading is a BUSINESS - Treat it as such!!