To make money in the stock market, it takes a special stock trading mindset. Anyone can make money in a bull market, but the best traders and investors make money in bull, bear and choppy markets. All these stock traders and investors have one thing in common, they have a specific mindset that helps that make endless profits.
Understand that these focused traders and investors do not profit on every trade, they are just purely consistent. A great average for winning on trades is 70% or better. That still means they will have 3 losers out of every 10. Even with this batting average, these focused stock trading pros still make millions a year. Their mindset is clear, they accept that not every trade will be a winner. They have also traded for so long that they know that if they have one, two or even three losers, they will maintain their average of 70%, so keep finding new opportunities, it all works out year after year. The worst thing a new trader or investor can do is get scared. Scared money never makes money.
Another key mindset is to keep expectations realistic. The mindset of a great stock trader and investor is to hit singles and doubles. This means that they are not looking to bank 100% on a trade or even 50%. 10% here, 15% there and even a smaller 5% winner is great. Investors and stock traders that try and hit home runs will lose 9 out of 10 times and be broke. Go into a stock trade or investment looking for a realistic target. Once achieved, bank it and move on.
Possibly the most important mindset and strength of the best traders and investors in the world is to not get caught up in the hype. Some of the best profit opportunities is to short a market when the technicals signal overbought but the hype and greed is insanely loud. Every analyst may be raising target prices and the talking heads on TV are pumping how amazing the market is. While average investors are jumping long this market, the best traders and investors in the world are shorting. It is the hardest trade in the world, but their focus and mindset allows them to see through the hype. The same thing applies to periods of massive fear, when all of Wall Street is running for the hills and panic is gripping the investing public. These are possibly the best times to buy stocks. It takes incredible discipline and focus to avoid the hype and accumulate stocks.