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So, you want to trade like a pro? Or just want to ensure that you’re a pro? Anyway, here are 10 of the most important characteristics of professionals in the crypto industry.
1. Orientation on the Process
For crypto masters, trading is a routine job. They aren’t focused on the results and don’t consider profits as regular weekly paychecks. Instead, they just trade. And trade. And trade more. Get it right, a professional doesn’t have to make hundreds of trades per day to achieve the goals they set.
But it’s required to dedicate at least a few hours per day to maintain positions, analyze markets, and, yeah, trade.
2. Control over Emotions
This routine leads to one important requirement: a professional must be patient and consistent. Go crazy, invest everything in a single asset or sell 90% of the portfolio in an hour – and you will be punished by the market. The cold head is a must-have for everybody who wants to master this tangled skill of crypto trading. According to this rule, investors also should avoid FUD and FOMO.
3. The Plan
Two previous points lead us to the next one. It’s the plan. Or even The Plan. A proper trading strategy or several strategies for different market conditions are obligatory even for newcomers. Needless to say that pros also have plans and stick to them. Such an approach helps them to deal with routine and get control over their emotions. Proper planning is a litmus test: if you fail it, you barely can become a pro.
Catch the paradox: a professional crypto investor must break his own rules sometimes. Due to the market’s immaturity and volatility, it can go in any direction without prerequisites at all, so even the most profitable strategy can fail suddenly and turn into big problems. Thus, a pro must be an intuitive person who isn’t afraid of departing from the plan. Surely, these skills of intuition come with experience, so be extremely cautious about this point.
Trading and crypto trading, in particular, are more about solo activities than cooperation. It’s easy to find hundreds of trading groups, chats, communities, and forums where people share their ideas and even deliver “100% true and profitable signals”. Stop and think: why would other traders spread this reliable info? To make new competitors? Nonsense. You’re on your own all the time.
Here’s a nice guide about analyzing the crowd and going against it: Fear and Greed.
6. Acceptance of Losses
Drawdowns are inevitable. Even the most successful traders can’t avoid them if they want to remain at the top. Sometimes, markets play against you. Sometimes, there are just bad days. But losses will come and they may be pretty huge. Once a trader realizes this fact, he or she makes a big step towards the pro paradise. Also, remember about emotions? Acceptance of losses is all about reacting to them calmly, you know.
7. Risk Management
When we talk about process orientation, planning, and resilience, it all comes to one big idea of proper risk management. Therefore, a pro trader should always know the exact level of risk for any given deal. Far more, he/she should evaluate it carefully to decide whether the rewards are worthy of entering the trade or not. It’s called risk/reward ratio. Additionally, there are more things to learn like position sizing or drawdowns.
8. Solid Knowledge
From risk management to technical analysis, it’s impossible to become a pro without studying a lot of topics. Basically, newcomers start with trading basics, then study crypto market differences, explore technical and fundamental analysis, then open the wonderful world of crypto trading bots and terminals, and so on. Most importantly, professionals are open to new knowledge and skills all the time.
9. Advanced Tech
Well, it’s not the most important sign but it matters, undoubtedly. While there are a lot of experts who refuse modern technologies, innovations can change the odds in favor of more open-minded investors. The mentioned bots automate trading strategies while crypto terminals provide access to several exchanges from one place. There are also hybrid solutions that combine both advantages.
10. Personal Life
Last but not least, masters don’t treat crypto trading as the one and only thing that matters. They spend time with close ones, watch movies, travel, procrastinate, eat unhealthy food, and even sometimes swear. Pros are ordinary humans with all the weaknesses and flaws. But they understand that there are way more activities outside of trading. When it becomes a routine job, you deserve some rest, right?
Signs that Don’t Refer to Professionals
In conclusion, let’s briefly cover widely-accepted features that people often associate with professional traders. Yeah, you got it, all these features aren’t the typical signs of experts. Surely, any pro investor may have one or more of them but they aren’t definitive. And they can’t magically turn you into a master of crypto.
Well, let’s check some of these false signals:
- Dedicating all your time to tradingHell, no. In the era of automation, you don’t have to sacrifice spare time, friends, and family to put a few more orders or read another article. Of course, some professionals are completely into the trading process. But, usually, they’re similar to clerks with eight or so working hours per day.
- Huge trading volume and tons of moneyIf a crypto geek trades 10 BTC, he or she may be an exemplary hamster. If he/she earns thousands of dollars daily, it’s the same. Everybody can be successful at bullish markets with enough luck but everybody still may make newbie mistakes.
- Working for an institutionIt’s a popular consideration when pro traders are associated with employees of hedge funds or banks. Sad truth is that so-called professionals aren’t always fully capable. Ideally, they know a few strategies and stick to them. But no more.
It should be simpler now to understand how professional traders feel about themselves. Remember the simple signs and never forget why you trade. Good luck.