The forex world can seem very isolated as if it is something that you can do with skills that are only used with trading. However, there are a lot of other things that we do within our lives that can help us to be better traders and can even teach us a little about it. Some of these things are sports. These sports can help to give us an edge when it comes to trading, either through the development of much needed skills or to give us a better understanding of what we need to do as traders. Today we are going to be looking at some of the sports that could benefit us as traders and can give us a better understanding or skill set when it comes to being a forex trader.
Patience Is Key
When it comes to sports, it may not seem like patience plays an important role, but it certainly does. You cannot simply force a play if you are on the football field, a boxing ring, a hockey pitch, or even a tennis court. You cannot simply force a play, your opponent simply won’t allow it, otherwise it would be a pretty boring and one-sided affair. So instead you need to show patience, you need to be able to sit back, to observe what is going on in the game and to then strike only when the time is right, only when the opposition presents you with an opening. The same thing happens with trading and forex, you cannot force a trade. If you try to do this, the markets will simply punish you, it will take your trade and throw a large loss out at you. You need to wait for the right moment in sport, just as you need to wait for the right trading opportunity and conditions when it comes to putting on a trade. Simply don’t try to force a trade, just like you wouldn’t force a play in sport.
Losses are a major part of trading, just like they are in sports. You won’t go through your career as a sportsman without a loss (apart from the very few in things like MMA) just like you won’t go through your trading career without a loss, so it is important that you learn to accept them. A loss is not the end of the world. The majority of sports teams that win their leagues or seasons, will suffer losses along the way, but those losses did not hold them back, and those losses did not stop them from being successful. We need to look at trading the same way. When we have a loss, as long as it is controlled and we only lose what we expected to lose, it will not prevent us from being successful. In fact, all the successful trades that you see out there regularly take losses. They are a small step back yes, but they are certainly not anything that you should be incredibly worried about or that will prevent you from being profitable and successful.
You Won’t Win All the Time
This is kind of in line with our previous points. A sports team needs to go into the next game with the idea that they can be beaten, as they cannot win every single game. If they go in with this mentality then they will be going in with their guard down and this is more often than not when they experience their losses. The same has to go for us with trading too. We need to know that the next trade is not a guaranteed win, and due to this we need to make sure that our risk management plans are in palace and that we are prepared for the possible loss. This will allow us to limit the damage that it will do. Sports teams cannot win every single game, it would be boring if they could, the same way that we cannot win every single trade. If we could, we wouldn’t need to trade as we would already have everything that we could ever want.
Look At Your Own Performance
More often than not you get sports people and teams looking at the wrong thing. They focus so much on the opposition that they completely forget to look at their own performances and neglect to work on what they need for themselves. The same thing can go for forex traders. They focus too much on what is happening in the markets or what other forex traders are doing rather than looking at their own trading performance. To look at what they have done and to analyse what they have done right and wrong, that is how you improve. However, if you are solely looking at the markets or other traders, you will not be able to work out what you need to work on or what you need to improve in order to be a better trader. So while looking at the opposition is important, you need to be able to look at your own performances from the start in order to become a better trader overall.
Work Smarter, Not Harder
When you watch your favourite sports team, what is one of the things that you notice when they do well and win? They may be working hard, but there is something else. They are most likely outsmarting the opposition. You can work as hard as you want, but if you are doing it in such a manner that also uses your brain, you will be able to pick the pockets and to make a difference. Both teams can work hard, but the one working smarter will have the advantage. This works the same for trading too. You can put as much time and effort in a you want, but if you do not put it in the right places or do not also think rather than just work, you will not make good trades and won’t be as profitable as you should be. Analyse what you are doing, work on your strengths, and take time to look at your performances to make sure that you can adapt things to get better results. Work hard, but also work smart, just like the most successful sports teams and players do.
Those are some of the things that are very similar between your favourite sports team or athletes and trading forex. You can learn a lot as they often do a lot of the same things or have the same things. Whether you want to be a successful trader or a successful sportsman, you will need to put in the effort. To have the right mindset, you analyse yourself and the opposition and play the game the way it is want to be played. Next time you watch your favourite sport, look at what the team is doing, you will most likely be able to take something away from it that you can then implement into your trading on the forex markets.