What does a realistic trading journey look like?

For many people, the first question when they start trading is, when do I become profitable? How long will it take? How many days do I have to trade to learn it? These are unfortunately questions that nobody will answer for you. And if someone says they will, they are likely trying to sell you something. The trading industry unfortunately is highly toxic, deceptive and full of scammers.

What does a realistic trading journey look like? There are some common steps that many (not all) traders follow:

1. Develop a trading plan: This involves selecting assets you want to trade (currency pairs, commodities etc.), determining a risk management strategy, and choosing the technical entry criteria. It’s important to have a clear plan in place before you start trading to increase your chances of success. Trading whenever you “feel like it” is equivalent to gambling and you will have more fun going to a casino with that attitude.
2. Learn about the markets but don’t overdo it: It’s important to have a good understanding of the markets you plan to trade in and the underlying assets you plan to trade. This may involve researching fundamental indicators, studying technical analysis, and familiarizing yourself with trading platforms and tools. You should however not go ballistic on this step. A simple strategy you execute consistently is far better than a complex one, you struggle with. Simplicity and consistency always win.
3. Don’t practice with a demo account: Almost all online brokers offer demo accounts that allow you to practice trading with virtual money and many people recommend doing that. This can be a good way to test out your trading strategies without risking any real money but it will not be the same as real trading. Do demo only when you develop your strategy but once you have it, go live with a small account. Nothing beats real-life experience, even if you risk just a few cents per trade.
4. Start small: As you gain experience and become more comfortable with trading, you may want to increase the size of your trades gradually. However, it’s generally a good idea to start small and gradually build up your account rather than taking on too much risk at once. The psychology of trading is a huge factor if you want to be successful and starting small makes it a bit easier to digest initially.
5. Review and adjust: As you trade, it’s essential to review your performance and adapt when needed regularly. This should be limited to figuring out where you make mistakes and fixing them. You don’t want to constantly change your strategy – after all, you’ve tested it and know it works. If you change it every time you take a loss, you have an entirely new monster to deal with and will never know if the losses are you not executing as you should, or the untested strategy. It’s like with everything – pick one approach, master it and stick to it. You may need to refine it at some point but I would not do it more often than 1-2 times a year. Market behaviour does change after all and you need to be flexible

Remember, trading can be challenging, and you must be realistic about your expectations. It’s also important to manage your risk carefully and never trade with money you can’t afford to lose, even if I repeat here what everyone else tells you already.