Develop an optimized trading strategy through trial and error learning

To strengthen performance and strategy, get to know the importance of trial and error learning. When trading forex, setbacks and errors are a vital part of the journey. Despite the ideal goal to constantly profit and avoid losses, forex traders can greatly benefit from the challenges of the market. Through trial and error learning, all endeavours and activities can be used as tools to learn and optimize. For a thriving trading career, find out how trial and error can eventually lead to increased profit, better performance and a more reliable strategy.

What is trial and error learning?

There are many methods you can apply to learn from the market and strengthen your trading system. In a performance-driven career like forex trading, you will need to use effective ways to build and enhance your strategy. One of the best ways to achieve this is to optimize through trial and error learning.

Trial and error learning is a problem solving technique that encourages diverse and repeated efforts for success. It is a constructive method to gain more knowledge and form solutions through frequent and varied experimentation. This involves experiencing a number of attempts and setbacks that all turn into progressive growth and enhanced behaviour.

According to H. Peyton Young of University of Oxford, a person can learn when testing new strategies and eliminating choices that did not work the previous time. Once successful trial and error learning is applied, the desired outcome can be reached much faster and with lesser errors.

To grow as a forex trader, take advantage of learning and optimizing through trial and error. Click To Tweet

The Puzzle Box Experiment by Thorndike

Learning through trial and error has been applied for years most especially in fields like psychology, engineering and technology. One of the experiments that studied trial and error learning was performed by American psychologist Edward Thorndike. He conducted his studies based on research and analysis with animal behaviour.

The Puzzle Box Experiment was an examination of the stimulation and response of a hungry cat in a puzzle box. This cat’s main goal was to perform the right action to get to the dish of food placed outside of the box. While being confined in the puzzle box, the cat made many attempts to get out until it finally pulled on the correct string. The cat then received its reward. After performing the same experiment several times, the cat gradually got out of the box much quicker with lesser errors.

“Responses that produce a satisfying effect in a particular situation become more likely to occur again in that situation, and responses that produce a discomforting effect become less likely to occur again in that situation” – Edward Thorndike: The Law of Effect

According to Edward Thorndike, an organism’s behaviour changes due to its consequences. With his well-known Puzzle Box Experiment, Thorndike was able to conclude a “Law of Effect” which notes that the key to learning comes from the satisfaction in rewards and the eluding of undesirable consequences. Once you gain a satisfying response from trial and error, you are more likely to repeat these rewarding actions while avoiding the actions that previously led to unwanted results.

Great advantages of trial and error learning

  1. Minimizes future risks or difficult scenarios
  2. Encourages better habits that optimize trading performance
  3. Boosts innovative or creative skills especially in problem solving
  4. Increases efficiency when working with trading tools and applications
  5. Strengthens efficiency of a strategy and overall trading system
  6. Enhances alertness or mental preparedness especially during unexpected challenges
  7. Improves behaviour and reaction towards losses
  8. Inspires a more proactive mindset and growth-driven way of thinking
  9. Allows traders to test and apply forex education into strategy
  10. Builds better trading character towards every challenging trading task

Demo account: The best way to apply trial and error learning for forex trading

In forex trading, the road to success requires diligence, experience and knowledge of the forex market. To pave the way towards successful trading performance, traders must gain optimal skills and learn the consequences of every action. Because of this, traders can highly benefit from trial and error learning. The best way to execute trial and error methods is through a demo account.

Forex traders have a great advantage of being able to test out and perform trial and error through a demo account. In a changeable forex market, it is vital to equip yourself with the right system and effective trading tools for success. A demo account allows traders to explore strategy as well as consequences of decision making without trading real capital.

Whether to test your strategy or to gain confidence in your system, learning through trial and error can help traders reach a higher level of expertise. You will need to apply trial and error when testing your tools, refining your strategy or practicing forex trading skills. Once you have completed trial and error period, see if you are ready to go from demo to a live account.

After applying trial and error learning, Find out if you are ready to go from a demo to a live trading account.

What you need for successful trial and error learning

To boost your strategy or fine-tune the application of trading tools, you will need to properly apply trial and error. Here are the top preparations you need for successful trial and error learning:

A target goal

The main purpose of trial and error is to test out different ways to reach a goal. Because of this, it is vital to set targets or goals to measure and track your progress. Doing this can help you set a benchmark for all efforts during trial and error learning. Target goals and planned goals for trading shares that having goals can help you establish an action plan and acquire the right knowledge needed for success. When pursuing trial and error methods for trading, be sure to prepare your goals and set the pace of learning.

Drive and motivation

Trial and error learning requires you to experience different difficulties and situations to test out which action leads to the desirable consequence. In Thorndike’s Puzzle Box Experiment, hunger was the driving factor of the cat to try different ways to go outside of the box. In the end, it was the cat’s appetite for the reward that lead to successful trial and error learning.

Traders need drive and motivation to succeed, learn and navigate an active forex market. While keeping your goal in mind, traders need to have self-motivation to complete trial and error stage. This means having the desire to thrive and overcome different challenges.

What drives you to reach successful trades? What is your motivation to profit from the forex market? Use your drive to become a successful trader.

Fine-tune strategies before trading real capital through trial and error learning on a demo account. Click To Tweet

Analytical mindset

Having an analytical mindset is an important part of trial and error learning. With plenty of data and tools to consider, traders must use the trial and error period to efficiently analyse every scenario. Through a demo account, you can examine every execution and strategy that led to a certain outcome. By using an analytical mindset during the experimental stage, traders can better develop the right action plan for any kind of trading scenario. Being more analytical also encourages traders to look at every angle and form the best conclusions.

To achieve successful trial and error learning, learn how to Boost trading performance with powerful analytical thinking.

Openness and optimism towards failure

The main significance of trial and error is experiencing setbacks and learning from it. Through a repeated trial and error stage, traders can learn from every experience. When you constantly apply trial and error for trading activities, you not only boost preparedness but also encourage a healthier view of failure.

Much like failure in business or sport, those who rise above losses and challenges become more equipped to take the right action in the future. To achieve a thriving trading career, become comfortable with failure and learn from each setback for the next trade. Be sure to grasp the opportunity to optimize and refine your strategy from reevaluating trading failure.

Progress tracking

While going through trial and error via demo account, traders must always track your progress. The most efficient way to keep track is through a trading journal. Having a trading journal allows traders to examine and take note of the actions that led to the consequences of the trade. Aside from this, a trading journal can also be used as an outlet for emotions. Being a mentally demanding endeavour, it can give traders the opportunity to track mental process that resulted in the certain action.

By tracking progress from executions and mental growth, you are ensuring a more systematic way to cultivate better habits for trading.

Equip yourself with the right strategy and most effective mindset through trial and error learning. Click To Tweet

Trial and error for forex trading success

Learning through trial and error is one of the most effective ways to grow as a trader. Based on Thorndike’s experiments, rewarding actions make a significant impression in the mind. It drives one’s evolution in decision making and strategizing to reach the desired goal. Trial and error also encourages steady learning and experimentation. When you apply trial and error learning in forex trading, you can train your mind to react to certain situations while also enhancing your strategy. This will gradually increase efficiency and decrease unmanageable scenarios.

By implementing a testing period before a live account, you are ensuring all strategies and tools are effective before trading real capital. For mental wellness, trial and error also helps traders develop the right mindset to achieve desired results. To develop a well-calculated strategy and achieve your trading goals, make the most out of trial and error learning through a demo account.



Paula Rodriguez

Paula is Titan FX Content Manager. She loves all thing creative and draws inspiration from different fields of art and expression. Her need to communicate and express her work made her pursue her love of storytelling and writing. Paula writes about the forex trading lifestyle for Titan FX and has a special interest in the physical and psychological fitness, discipline, and determination required to be a successful trader.

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