There are several factors that are responsible for making profits in stock trading. While some of them are outside your control, there are many that you can control yourself. The truth is that if all the factors were within the control of the trader, then nobody would incur losses. But this is against the very nature of any business including stock trading. A successful stock trader is one who manipulates even the adverse outside factors to his advantage.

We all know that stock market keeps rising and falling and even the best stock market experts and pundits quite often fail to anticipate its trends despite life long experience and expertise behind them. There is also no denying the fact that there are hundreds and thousands of stock traders who have made millions and continue to do so. At the same time there are more losers and quitters than the winners in the very same market and trading conditions.

There are several factors that determine your success or failure in stock trading.

The first and the most important requirement for making sure profits in stock trading is to understand your own mental capabilities, your personal strengths and weakness, your beliefs, propensities and outlook. It is creating a personal data of your own mental assets and liabilities. This will allow you to develop a special mindset that is peculiar to winning in stock trading.

Some people enter stock trading because a friend's friend is making thousands upon thousands of dollars every month. Or a stock market guru had predicted about hot stock for a particular week. It obviously means that you have taken to stock trading without thoroughly understanding your own nature or studying the stock market itself. You are working on the minds of others, seeing the things with others? eyes.

Let us assume for a moment that the prediction made by the guru came true and you made a quick buck. You again followed his advice about the next hot stock, but this time you suffered loss. You are depressed and want to quit stock trading. This kind of attitude points to the fact that you have not thoroughly examined your own personal mental make up with regard to stock trading.

What is the ideal solution?

First, as an intelligent stock trader, you should learn to study the stock market yourself and take independent decisions irrespective of the advice offered by the so-called gurus and experts. You should develop your own personal intelligence assets based upon your own knowledge, expertise and experience. For this you must learn to understand the stock market trends, make fundamental and technical analysis and do every thing else to build your own reliable data of knowledge about stock trading.

Secondly, you must realize that even your best judgment and intuition can go wrong and you should be prepared to suffer losses. You should be willing to take them in your stride as a part of the game. Above all you should not quit stock trading because you have suffered losses in a particular phase. You should learn to look at your profits and losses in right perspective.

Do not work with revenge mentality. Quite often you buy a stock and suffer loss in it after a few days. You naturally feel frustrated and make up your mind to recover your loss from this very stock even though it is fundamentally a poor performing stock. Involving your ego or sense of false pride in such situations can prove self-defeating in the long run.

You must understand that stock market is like a stream whose currents keep changing. You should be always on the look out to make the best of those currents. You have to either fight them or ride them.

There are stock traders who can make money even when most of the traders suffer losses and quit trading. For example, intelligent traders buy the stocks of good companies when their prices are down as in the present stock market situation of slump and recession. It requires a great courage and imagination to buy stocks during apparently bleak and hopeless phases.

With this kind of mental make up you can make profits on consistent basis. This can be achieved only when you develop a kind of self-awareness about mental and intellectual assets. You develop the right market perspectives and plan accordingly. This generates the confidence of a winner.