Prop Firms – Analytical Skills and high Emotional
Quotient (EQ) - Essentials
As we get along with a more enhanced version of Prop Trading Firms that use CFDs, a lesser recognized topic of skills needed for a good prop trader is undermined and not discussed a lot But with years of experience, the skill of being good at analytics and EQ level are being more in demand, and with traders needing to upskill themselves it’s an area of focus both for Best Prop Firms and Traders to collectively work on. Traditionally, the Prop Trading Firms including the ones that are considered to be top prop firms have very little focus on these key requirements
Traditionally, Prop Trading has been associated with Investment Banks and Hedge Funds where financial derivatives are worked with disciplined trading strategies to go for profitable trades Taking into account the rising and falling global markets, experienced traders trade on CFDs to earn real-time profits. The traders were backed by a strong risk management structure and in return earned profits and proved their track record These proprietary trading firms generally had multiple funding plans and used a few trading platforms
Let’s try and decode this down to understand the impact of both these skills on trading:
ANALYTICAL SKILLS -
1 – A strong analytical mindset will help the prop trader to be good at placing trades and ensuring timely and fast execution Evaluating the Price Movements is key as this decides the action of accurate buying or selling The trading instruments have multiple layers of data and need a lot of patience to go through them
2 – The ability to interpret data and its global impact is easy Today's world is interconnected with what's happening all around and not just local factors Hence as a trader knowing the global events and their impact on Financial Markets is the key to success.
3 – Finding price points using strong technical analysis to identify entry and exit points. Experienced CFDs traders use a lot of trading strategies backed by strong risk management and deliver the best possible profits
- Understanding the current business cycles and trends to identify the business opportunity. If the traders are unable to pick up opportunities that will have strong margins in the future, then missing these will cost them dearly. Constant learning and focusing on patterns in market trends are the key areas
5 – Ability to forecast the market sentiments and long-term view. The financial markets are driven by spreads which are caused by differences in prices Market sentiments play an extremely important role, and a smart trader can easily identify the assets where there is a long-term story and places where it's just a bubble. Hence data-backed decisions and optimal understanding of the economy and markets shall help in decisions
EMOTIONAL QUOTIENT –
1 – A balance between work and personal life is needed as this shall help the traders overcome the setbacks that may happen on a day-to-day basis Trading is no easy business as it’s a volatile market, resulting in anxious moments throughout the day. So, a person with a high EQ level will be able to control the situation better. It's a proven fact that happy minds come up with great performances If we take a sample of the most successful firms in the world, one thing that will turn out in common will be an empathetic work culture
2 – The ability to be open to learning and understanding the markets with a strong rationale is needed to have a breakthrough with new ideas These are essential especially if you have a live account.
3 – Individuals with high EQ levels are more adaptive to ever-changing markets and technology resulting in chances of better performance
On a side note, I have recently enrolled with a prop firm – Hola Prime - and they seem to value these traits a lot The support and conversations I had in one-on-one sessions with their coach, helped me a lot to implement strong analytical and emotional skills into my trading activities
After discussing with them, I have been able to gain a lot of trust in them since all the trading rules were very clearly informed in the initial stages of registration One of their core values is being transparent The setup of the firm denotes reliable customer service, being supportive of the traders, helping them grow, and building a strong knowledge database through their Price Transparency reports where prop traders can verify that their trade executions are fair and aligned with market-advertised prices This ensures full-price transparency for their traders
Hola Prime is truly committed to Transparency no hidden rules and practices
Instant payouts were a big hit for me and showed strong financial stability. Hola Prime offers five different platforms for trading and sets up achievable targets so that it encourages traders to go ahead and be creative for target completion
Hola Prime has a very strong knowledge bank and educative support system by the name of Hola Prime Academy, wherein there are live sessions and professionally qualified coaches who deliver the best sessions. The topics include the latest trends in business and economy, technology, the field of psychology, trends in trading patterns, basics of mental health, and strong and data decision-making progress There is so much to learn and understand about the trading world from these academies and referring to the earlier discussions this goes a long way in impacting Analytical skills and emotional quotient for the trading community
I like the fact that they have invested money into the well-being of their traders, which is indicative of the fact that they truly value their traders and want them to succeed Wish you all the best, Hola Prime