FYI | 11:31 AM
Many traders enter the markets with enthusiasm, technical knowledge, and a determination to succeed. Yet, their results often fall short.
In most cases, it’s not a lack of skill or market understanding that causes underperformance – it’s their habits.
By Louise Bedford
Through years of mentoring and observing thousands of traders, I’ve noticed three recurring behaviours that consistently derail otherwise capable investors.
Addressing these habits early can make the difference between steady growth and ongoing frustration.
1. Negative Self-Talk and a Fixed Mindset
One of the most damaging habits I see is how traders speak to themselves. I recently met a trader who told me, “If I haven’t made it by now, I’ll never make it.”
This kind of statement is rarely harmless. It often signals a fixed mindset – the belief that ability is static and cannot improve with effort. Traders with a fixed mindset are quick to abandon strategies at the first sign of difficulty. They may also avoid challenging themselves for fear that a poor result will damage their self-image.
Research in behavioural finance and psychology repeatedly shows that those with a fixed mindset are more prone to giving up under pressure, while traders with a growth mindset see setbacks as opportunities to refine their skills. They’re focused on the process, not just the outcome, which allows them to continue learning and adapt more effectively to market conditions.
For traders, this means reframing losses as tuition fees and viewing every market environment as a chance to build resilience. The market will test you – your self-talk will determine whether you can withstand those tests.
2. Overcomplicating Strategies
Complexity is another silent killer of trading results. Many beginners believe that the more indicators, markets, and strategies they add, the better their performance will be. In reality, complexity often leads to decision fatigue, increased errors, and missed opportunities.
Successful traders strip their processes down to what is essential. They focus on the highest-probability setups and the clearest market conditions, rather than chasing every possible trade.
If your trading plan has grown too complicated, ask yourself two questions:
-Which elements directly contribute to consistent profits?
-Which are distractions that consume time without delivering returns?
Cutting unnecessary complexity not only improves clarity, it reduces stress – allowing you to execute with greater discipline.
3. Isolating Yourself from a Trading Community
Investing is often seen as a solitary pursuit, but this perception can be costly. In many professions –-medicine, education, sports-– mentoring and peer support are considered essential to career progression. Yet traders and investors frequently attempt to succeed without external guidance.
The result is slower learning, repeated mistakes, and a lack of perspective. Without the input of other skilled traders, it’s easy to become locked into unproductive habits or to miss critical changes in market dynamics.
Finding the right trading community provides accountability, shared experience, and the ability to learn from others’ successes and setbacks. It also counteracts the social isolation that can come from pursuing a path few people in your everyday life understand.
Whether through formal mentoring, trading forums, or structured discussion groups, aligning yourself with like-minded traders can accelerate your development and protect your confidence during drawdowns.
In Summary
The markets are an arena where technical skills matter – but behavioural patterns matter more.
By addressing negative self-talk, reducing complexity, and actively seeking support from other traders, you give yourself a decisive edge.
****
Louise Bedford is a full-time private trader and author of six books on the sharemarket. She is the host of the Talking Trading podcast and founder of www.tradinggame.com.au.
Views expressed are not by association FNArena’s.
Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided.
FNArena is proud about its track record and past achievements: Ten Years On