Trade can be a challenge, but above all it is risky. Successful investors and traders agree that making mistakes is part of learning. However, you do not have to repeat the mistakes made by others. We can all learn from mistakes.
Here are four mistakes you should avoid in the stock market for a successful career in commerce.
As a new investor, you should never be attracted to what is presented as free money. A margin is money extended to you by your broker as credit. Without experience in the trade, buying at margin could lead to unnecessary debt. Limit yourself to buying shares using your capital, which places you within the risk profile that your capital allows. In this way, even if your positions do not give way, you can live to trade another day. When all your investments fail and you buy them with margin, you get into debt, in addition to losing your capital.
An intelligent investment involves buying action at the right prices of the shares and selling when the price reaches its desirable point or when the loss cannot be sustainable. Pursuing the sock involves trying to complete an order by bidding successively as the rice moves. This is a reactionary bid, and you could lose your focus on finding an order without being strategic about the risks and leverage you have. Avoid this at all costs. Buy at the right time and get out at the strategic moment. Do not chase
Trade has to do with speculation, but do not be fooled into thinking that it is a game of waiting and praying for actions to turn in your favor. So do not wait. Instead, develop a strategy based on the philosophical and logical analysis of market conditions. This is the only way you will remain objective when selecting your positions and making the calls. Buying shares in the hope of selling them with profits requires more than hope.
It requires discipline to comply with your strategy and perform a performance analysis to determine how each operation was performed, the lessons learned and your losses and gains with respect to our portfolio.
This can be determined by conducting a post-trade analysis.
Most investors, especially beginners, have been frightened to the point that they think less of themselves when it comes to excelling in the market. Success has been reserved in some way for sophisticated investors with years of experience. But do not be fooled. Beginners can also be successful; It does not have to come after years of negotiation. However, it also depends on how success is defined. For a beginner, success must involve mastering a strategy that changes from $ 100 to $ 150 after two days. It’s about getting returns on your capital. And as you get used to trading, your capital also increases in line with your risk tolerance. That is the definition of success. Therefore, do not underestimate your abilities and your potential to be a successful investor.
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