For most people, trading is a hobby. It's something to do for fun and entertainment. You can make a little bit of money on the side or maybe even quit your day job if you're lucky. But for others, trading is all about making money. Whether it's through some sort of investment or just making up for lost funds due to an unexpected expense, these people want to make sure that they come out ahead in the end no matter what happens along the way.
Using leverage to win big and lose big
Buying on margin is a great way to trade and make money, but you have to be very careful with it. If you are going to use leverage, do not use it for any of the following reasons:
To win big
To cover losses
To try and make quick profits
No Risk management plan
The most important thing to learn as a trader is how to manage your risk. You should have a risk management plan before you start trading. Risk management is the difference between a good trader and a bad trader. If you don't have one, then you're going to lose money no matter what strategy you use because all strategies have some sort of drawdown, even if it's just paper losses on paper trades. A good trading style with poor risk management will result in losing more than 90% of your money over time. A great trading style with poor risk management will also result in losing more than 90% of your money over time! Risk Management = Successful Trading
Unable to control emotion
Knowing that your emotions will affect your trading, make sure you know yourself well enough to be able to control them.
When you are about to enter a trade, take some time for self reflection and ask yourself: "Why am I entering this trade? Is it because I believe in the company/currency/future of this market?" If not, then don't proceed with the trade - it would only be based on emotion, which we've already established is a bad thing!
If you have been losing money over many days or weeks (or months), take some time out of the market until you can get back in without being ruled by emotions such as anger or frustration (which are common after losing money). For example: if there has been a big drop in price and your portfolio has lost 10% since last week - don't rush into buying more just because everyone else is doing it!
Emphasis of profit more than processes
The most important aspect in trading is your processes. It's not the profit which is what you should focus on but rather the process by which you gain that profit.
Profit is a byproduct of good processes, but we often forget this and put emphasis on the end goal rather than our efforts to reach it.
The same can be said for everything in life. If you're not constantly improving yourself, your business and your processes then you will fall behind.
Processes are incredibly important in trading. If you don't have the right process then you're going to have a hard time making consistent profits. It's like trying to build a house without blueprints or any construction knowledge; it just won't work. So, what are some of the best ways to improve your trading processes?
High expectation with no effort and time put in
So what does all this have to do with you? Well, if you are one of those people who has a high expectation without the right knowledge, tools and mindset, then there's a high chance that your trading career will fail.
The truth is that many traders who start off with big dreams never make it as they struggle with their expectations. They may be thinking "I can do this" or "This is going to change my life", but they don't realize that there are no shortcuts or easy routes to success in this business. It takes time, effort and commitment to achieve something great in any field of work. To become successful in trading, you need to learn about the market first before taking any action because experience is the best teacher and only through it can we truly understand how things work on KLSE.
Learn from the 2% of CONSISTENT profitable trader.
If you are a trader, there is a 98% chance that you will lose money.
The 2% of traders who consistently earn profits are the ones that make the most money, so if you want to be successful, learn from them.
Here are some things they do differently:
They have a trading plan and follow it CONSISTENTLY. This means they have an idea of when they're going to get in and out of trades and what price range their stop loss will be in order to protect their capital at all times without fail. They may even put additional stops in place with smaller targets than just their initial entry price so that if their trade doesn't work out as planned for whatever reason (like market volatility), then at least the majority of the investment is protected from getting wiped out completely by those unexpected events which inevitably happen from time-to-time when trading stocks or forex markets.
They have an edge over the market, which means they have an advantage over other traders. Some examples include: having access to information that is not publicly available yet (e.g. insider trading), having a better understanding of technical analysis than most other traders out there, or simply being able to recognize patterns faster than everyone else (so you can jump on them before others do).
The most important thing you can do is to take time out and learn from experienced traders. You have to learn from their mistakes, but also from their processes, systems and strategies. Learn how the successful trader analyses & achieves consistent return by following the big boys.
Find you trading solutions in our upcoming webinar, know the 3 ways to trade in the stock market to increase your winning trade.
WED | 08-02-2023 8:30PM
SAT | 11-02-2023 8:30PM
Registration link :
More learning articles in our blog, YouTube videos, & our upcoming webinars.
Blogs : https://www.roundnsurge.com/news
Facebook : https://www.facebook.com/RoundnSurge89
Instagram : https://www.instagram.com/roundnsurge/
Webinars : https://www.roundnsurge.com/events
This blog is for sharing our point of view about the market movement and stocks only. The opinions and information herein are based on available data believed to be reliable and shall not be construed as an offer, invitation or solicitation to buy or sell any securities. Round & Surge and/or its associated persons do not warrant, represent, and/or guarantee the accuracy of any opinions and information herein in any manner whatsoever. No reliance upon any parts thereof by anyone shall give rise to any claim whatsoever against Round & Surge. It is not advice or recommendation to buy or sell any financial instrument. Viewers and readers are responsible for their own trading decisions. The author of this blog is not liable for any losses incurred from any investment or trading.