The following are the common trading mistakes, generally an investor do:
LACK OF KNOWLEDGE AND NO PLAN
It amazes us that some people expect to trade the stock market successfully without any effort. Yet if they want to take up chess, for example, they will happily take some lessons or at least read a book before heading out onto the course.
The stock market is not the place for the ill informed.
UNREALISTIC EXPECTATIONS
Many novice traders expect to make guide bucks. Or they start to write out their resignation letter before they have even placed their first trade!
Now, don’t get us wrong. The stock market can be a great way to replace your current income and for creating wealth but it does require time. Not a lot, but some.
Other beginners think that trading can be 100% accurate all the time. Of course this is unrealistic.
LISTENING TO OTHERS
When traders first start out they often feel like they know nothing and that everyone else has the answers. So they listen to all the news reports and so called ‘experts’ and get totally confused.
And they take ‘tips’ from their near ones.
We will show you how you can get to know everything you need to know and so never have to listen to anyone else, ever again!
GETTING IN THE WAY
By this we mean letting your ego or your emotions get in the way of doing what you know you need to do.
When you first start to trade it is very difficult to control your emotions. Fear and greed can be overwhelming. Lack of discipline; lack of patience and over confidence are just some of the other problems that we all face.
It is critical you understand how to control this side of trading. There is also one other key that almost no one seems to talk about. But more on this another time!
Common trading mistakes may cause great losses
POOR MONEY MANAGEMENT
It never ceases to amaze us how many traders don’t understand the critical nature of money management and the related area of risk management.
This is a critical aspect of trading. If you don’t get this right you not only won’t be successful, you won’t survive!
ONLY TRADING MARKET IN ONE DIRECTION
Most new traders only learn how to trade a rising market. And very few traders know really good strategies for trading in a falling market.
If you don’t learn to trade ‘both’ sides of the market, you are drastically limiting the number of trades you can take. And this limits the amount of money you can make.
OVERTRADING
Most traders new to trading feel they have to be in the market all the time to make any real money. And they see trading opportunities when they’re not even there.
