Trading can feel like a big puzzle. You look at charts, news, and lots of data. You try many tools and strategies. But sometimes, you end up confused and unsure what to do next.
This is where the 80/20 Rule can help you.
The 80/20 Rule says: 80% of your results come from 20% of your efforts. This means most of your success comes from a few simple things, not everything you do.
In this blog post, we will talk about how you can use the 80/20 Rule to improve your trading. You will learn how to find the most important parts of trading and focus on them. This way, you can become a better trader without feeling lost.
What Is the 80/20 Rule?
The 80/20 Rule is also called the Pareto Principle. It was named after an Italian economist named Vilfredo Pareto. He saw that 80% of the land in Italy was owned by 20% of the people. This idea works in many areas, including business, health, and trading.
In trading, it means:
80% of your profits come from 20% of your trades.
80% of your mistakes come from 20% of your bad habits.
80% of what you learn can come from 20% of the important topics.
So, focusing on that 20% can help you get the most success.
Why Does the 80/20 Rule Matter for Traders?
Many new traders try to learn everything at once. They watch all kinds of videos, try many indicators, and follow many strategies. This can be too much and lead to poor results.
The 80/20 Rule helps you cut through the noise. You focus only on what really matters. This helps you:
Make clearer decisions
Avoid mistakes
Save time
Build confidence
At Hive PT, we teach traders to focus on what works so they can pass funded account challenges and grow their skills quickly. You can learn more about our Evaluation Process here.
How to Use the 80/20 Rule in Your Trading
Step 1: Find Your Best Trading Setups
Look at your past trades or practice accounts. Which trades gave you the most profit? Which ones gave losses?
Most likely, a small number of setups make up most of your profits. These are your best setups.
Focus on learning these setups well. Practice them until you can spot them quickly.
If you want to test yourself, try Hive PT’s funded trading challenges. They help you practice real market conditions with clear goals. You can check out our trading challenges here and join a challenge now.
Step 2: Use Only a Few Indicators
Many new traders try to use too many indicators on their charts. This causes confusion and slows you down.
Pick 2 or 3 indicators that you understand and trust. Learn how to read them well.
Our blog about Top 10 Indicators Used by Professional Prop Traders is a great place to start.
Step 3: Protect Your Money First
One of the most important parts of trading is risk management. This means keeping your losses small and your gains big.
You don’t have to risk a lot on every trade. Focus on using:
Small position sizes
Stop losses to limit your losses
Good risk to reward ratios (like risking $1 to make $3)
Learn how to manage your risk well in our article: Risk Management Techniques Every Trader Should Know in 2025.
Step 4: Control Your Emotions
Trading can make you feel excited, nervous, or even scared. But emotions can lead to bad decisions.
To follow the 80/20 Rule, control your emotions by:
Making a trading plan and sticking to it
Not chasing losses or revenge trading
Taking breaks if you feel stressed or upset
Check out tips on trading discipline in The Role of Discipline in Achieving Trading Goals Easily in 2025.
Step 5: Learn Smartly
Not all learning is equal. Don’t spend hours on random videos or articles.
Use good learning resources that focus on what matters. Hive PT offers many great educational materials:
Spend most of your time on these and practice what you learn.
Common Trading Mistakes to Avoid with the 80/20 Rule
Ignoring the 80/20 Rule often leads to these mistakes:
Trying to learn too much: You get stuck with too much information.
Switching strategies too often: You never get good at one thing.
Overtrading: Taking too many trades with small edge.
Risking too much: Losing big money on one trade.
Letting emotions control you: Making impulsive decisions.
Stop these mistakes by focusing on the key 20% that drives your results.
How Hive PT Helps Traders Use the 80/20 Rule
Hive PT is a prop trading firm that helps traders focus on the right things.
We offer funded challenges that teach you what matters to get funded.
Our hierarchy rewards good traders and helps them grow into senior roles.
We provide education to learn at your own pace.
We have a strong community where traders help each other.
Join our community and start focusing on what really matters: Become a Bee Trader and Join Our Trading Community on Discord.
Real-Life Example: How Focusing on 20% Works
Imagine a trader named Sarah. She started with many indicators and strategies. She lost money and felt frustrated.
Then, Sarah looked at her trades and found that most of her profits came from trades using just two indicators. She stopped using everything else.
Sarah also focused on controlling risk better and controlling her emotions. She practiced with Hive PT’s challenges to sharpen her skills.
Now, Sarah wins more often and trades with less stress. This shows how the 80/20 Rule helps traders focus and succeed.
Extra Tips to Apply the 80/20 Rule Every Day
Write down your top 3 favorite setups and focus on them.
Use only 2 or 3 indicators that work well for you.
Set strict risk limits before every trade.
Keep a trading journal to track what works.
Spend time each day learning from trusted sources.
Final Thoughts
Trading success doesn’t come from doing everything. It comes from doing the few important things very well.
By applying the 80/20 Rule, you cut down the noise, reduce mistakes, and focus on your strengths. This approach makes your trading clearer, easier, and more profitable.
If you want to start trading smarter today, check out Hive PT’s funded challenges and educational resources. These tools are designed to help you focus on what matters and grow as a trader.
Start your focused trading journey now: Get Funded Now.
