THE BIGGEST MISTAKES NEW TRADERS AND INVESTORS MAKE

 

Most beginnmistakes new traders makeer traders and investors in the stock market lose part or even all of their invested capital in the markets. Though the reasons why this happens has been analyzed again and again; newbies in this market continue to experience these difficulties. Though this could be attributed to ignorance or lack of knowledge, it could be that the psychology of new traders is exploited by the market dynamics.
For instance, they may get fascinated by the possibilities of profit the market provides and hence look to book profits quickly. Such frequency in trading can result to the newbie trader or investor falling into market traps easily.

Let us explore some of the mistakes new traders make.
1. Not cutting their losses in time; we have always heard of the phrase; “Cut your losses quickly and let your profits run”. Though this is repeated over and over, new traders continue falling short of doing that by the mere excitement of booking some profits early. They are also not prepared to take a loss and usually wait for the market to turn around and head to their direction. Markets trend and their loosing position quickly consume their capital and also hold margin that could have used to place other trades.

2. High Leverage; most new traders approach the market from a ‘get rich quick’ perspective. This leads to high use of leverage in order to win big. Though this is possible, leverage also amplifies the losing side. Hence a number of consecutive losing trades will wipe out their trading capital.

3. Over-trading; experienced traders and investors always advice newbies to take trading as a business and not a hobby. However, the excitement of trading influences the habits of new traders easily. This makes them place numerous trades and watch several unrelated markets at the same time. More often than not, their mindset and trading approach becomes overstretched rendering them inefficient in trading.

4. Relying on others; new traders often follow the so called “trading gurus”. This ranges from following major online financial analysts to social media. By doing this, they abandon they trading plan and approach leading to inconsistency in their results and finally losses.

5. Lack of a trading plan; discipline is a major trait that successful traders possess. They create a trading plan based on their trading strategy and stick to it leading to consistency in their trading. They are also able to track their mistakes from the trading plan and correct accordingly. On the other hand, new traders do not keep a trading plan and end up moving from strategy to strategy and following others as discussed in mistake 4.

6. Adding into losing positions; new traders double their losing positions in the hope of getting a breakeven. This is disastrous especially in a trending market. If the market continues to move against their positions they end up with huge losses and the risk of losing their entire capital.

7. Slacking in acquiring more skill; experienced traders reached their level by working hard and acquiring more skills to survive and make profits from the market. On the other hand, new traders think that making money from the market is easy and rarely put enough effort till it is too late.

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  1. Commented by: Alfredcop

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    먹튀 해결 팀의 먹튀 확인은 투명성과 정확함을 기반으로 합니다. 항상 이용자들의 의견을 우선으로 생각하고, 기업의 유혹이나 이익에 흔들리지 않고 한 건의 삭제 없이 사실만을 근거로 검증해왔습니다. 먹튀 문제를 당한 후 후회하지 않도록, 바로 지금 시작해보세요.

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    유일무이한 먹튀 검증 알고리즘
    먹튀해결사는 깨끗한 도박 문화를 형성하기 위해 항상 노력합니다. 저희가 소개하는 토토사이트에서 안전하게 베팅하세요. 고객님의 먹튀 신고는 먹튀 리스트에 기재되어 해당되는 토토사이트에 심각한 영향을 줄 수 있습니다. 먹튀 리스트 작성 시 먹튀블러드 만의 검증 지식을 충분히 활용하여 공정한 심사를 하도록 하겠습니다.

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  2. Commented by: Lesliemop

    Investigating Contest Gaming Hubs: An Exciting and Reachable Gambling Choice

    Prelude
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  3. Commented by: Haroldcroni

    Unveiling Free Casino Games

    Start
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  4. Commented by: Scottexazy

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