Independent thinking – A quality to cultivate in trading

We can generally find many qualities in successful traders, including discipline, patience, adaptability, independence, and mental toughness. You can work on several of them simultaneously, but one question remains — which one to prioritize? In other words, which quality should you cultivate the most to become successful at trading?

Our answer is independent thinking. It’s an essential quality that can help you in all aspects of life. Yes, it’s a bold claim to make, and you will have a chance to come to your conclusions. But before you do, let’s see what independent thinking is and why it is an important quality to cultivate in trading.

What is independent thinking?

Let’s start with a couple of questions:

  • Do you reason things out yourself or seek outside opinions and guidance?
  • Are you under the impression that your experiences, creativity, values, and expertise are more than enough to rely on?
  • Instead of adopting others’ judgments and assessments, do you often form your own opinion?

If you’ve answered all these questions with a resounding yes, congratulations, you are an independent thinker. Now, you probably have an idea about what independent thinking is. Nevertheless, here is the definition:

“Independent thinking is being confident enough to rely on your intelligence, views, and values, and trusting in your own judgment to guide you, rather than someone else’s.”

Simply put, independent thinking is all about having confidence in your ability to filter the information, in your thought process, and final judgment. In other words, independent thinkers do not seek to validate their opinions with others. They are confident in their skills and abilities and are not afraid to follow their own principles and standards. 

However, in an information age where most often done not, we are overloaded with a lot of information, opinions, news, etc. It can be pretty challenging for a trader to think for himself and form his own opinions about that market.

You are probably starting to see why it is essential to cultivate an independent mindset in trading. Let’s see the advantages of being an independent thinker in the world of trading.

Learning how to recognize unfiltered information is essential

Information flow in the modern age is humongous. As a trader, you need some sort of methodology to organize it and filter the information. Why? Because the raw information flow is unfiltered. It floods your channels with too much random information, which can be overwhelming, and most of it won’t do anything else but confuse and mislead you. 

This is where independent thinking can be beneficial.

First, as an independent thinker, you will be able to recognize unfiltered information even if people around you vouch for it and base their trading decision on it. You will be able to take a step back, see what it is about, question its authenticity, and then decide for yourself. 

The most important aspect of independent thinking here is trusting your own experiences and expertise rather than what others think. It’s ok not to know the background of the price action or whether the prices are going up or down. But, if you rely on your knowledge and know-how based on proven market fundamentals to filter information, you will be better able to make informed decisions instead of trading blindly.

There are a lot of news with opinions and bias 

Now let’s address “the news” traders so heavily rely on for a second. Unfortunately, the news today has shifted from what news means essentially -” newly received or noteworthy information, especially about recent events.” So, instead of reading that Company X went public, the chances are that you will read the price movement of its stocks in the following days, why it went public, and the prognosis of the company’s performance in the future.

Of course, not all forms of news are like this, but a lot comes with personal opinions and bias. The problem is that the information comes from various channels, including podcasts, news portals, blogs, social media, and the chatter in the networking group, and they are all infused with other people’s opinions.

As an independent thinker, you will have the power to dissect the news, take the vital information out, use it to control your decisions, and forget all about the reporter’s opinions and bias.

Being a real trader is all about making your own decisions

If you love to watch the guides, follow a mentor, or run ideas by your colleagues, you probably often find yourself struggling to place a finger on a good trading strategy. You might think that it is not good enough and that something is missing. The missing thing is key to your success, and it’s you.

Yes, you! Being a real trader boils down to making your own decisions and standing by them. You can learn from the outcome, whether it is good or bad. The more experience you have as someone who owns their mistakes and makes their own decision, the more confident you’ll become. And more confidence will help you cultivate independent thinking. 

Successful trading involves risk, and you can’t do it without independent thinking

Trading involves risk; successful trading involves even more of it. As a trader, you will never be 100% certain that the price of the financial asset you’re investing into will go up or down. That is why there are various risk management strategies out there to help protect your trading capital. How is independent thinking helpful in this scenario?

Well, for starters, you won’t fall victim to popular opinions telling you that investing in something is entirely risk-free. You won’t venture into any form of investment vehicle without a proper exit plan and risk management strategy. Independent thinking will empower you to identify all the risks associated with a trade and perform an in-depth analysis.

With all this information at your disposal, you will develop a relevant risk management strategy and become more successful as a trader.

Independent thinking can help you find the right information

We’ve already discussed the information flow and how big it is. Finding the right information is vital for your success, but the sheer amount of data you have to access and process can be compared to looking for a needle in a haystack – very daunting. But, if you are an independent thinker, you will find the correct information regardless.

You will be able to assess information sources. Choosing credible, trustworthy, and authoritative sources will narrow down information flow. Then, you will go through the information by filtering out biases and opinions. Ultimately you will end up with the essential information you can use as a basis for decision making.

Sometimes trading requires you to take a different path 

Traders tend to have similar trading strategies as they often use the same information to fuel their decision process. Some people tend to do it because it makes them feel more confident. After all, they are acting on a “group decision.” 

They are under the impression that if the decision proves terrible, they fail, not as individuals, but as part of a group. The truth is the opposite; whether you fail as part of a group or fly solo, you still fail.

Independent thinking will help you take a different path which trading sometimes requires you to. That’s what the most famous traders, such as John Paulson and Paul Tudor Jones, did when they made a fortune. 


Independent thinking is an excellent quality to cultivate if you are into trading. Successful traders are mostly independent thinkers who have shaped their trading beliefs and opinions about the market based on their unique experiences. They have a high sense of self-worth and are not easily affected by their emotions or others’. Do you consider yourself an independent thinker? 

If you do, feel free to sign up for an account at OneUp Trader to get evaluated. If you pass the one-step trading evaluation successfully, you will have the privilege of being placed with one of their funding partners and potentially write your own success story as an independent thinker.