4 Things to Keep in Mind When Trading Stock
No Secret Strategy
The first thing is there’s no secret trading strategy. There’s no secret setup that will guarantee you 100% success rate all the time. Everyone’s trading setup and strategy are going to be different. A trader can give you his strategy from steps A to Z on how to buy stock that works well for him. Lets say that the strategy gives him a 80% success rate. You can take it and copy it, but it’s not going to do the same for you. We are all different traders, while a person can give you setups and strategies, it will still require you to practice and adapt to that strategy. You got to determine if it fits your personality, and what adjustments you need to make to see results.
Come Up With Your Own Trading Plans
The second thing is make your own trading plans. Whether a stock should be purchased or sold, that decision should never be made, because you see other people doing it. Think about it, Do you even know the value of the stock? Do you know the float number? It’s fine to read and observe what others are doing for ideas that could lead to your own setups, but don’t follow others. You can get a ton of ideas from other traders, but it’s up to you to take those ideas and filter them out, and see if there is a short-term or long-term setup. It’s called finding a stock idea, but creating your own plan based off the idea.
Study The Stock Charts
Now, the third thing is to focus on reading the chart first. Reading stock charts and candlestick price action is most likely the most important key factors to understand when trading stock. There is a learning curve involved with trading stock. When you first start trading you may feel overwhelmed. There’s the charts, the indicators, analyzing news earnings, etc. If the daily chart is moving slowly and the spikes are hard to predict, then you may want to stay away from that stock. Once you learn how to read the charts and the price action, then you can determine if you want to buy that stock. Now, if you are investing long-term, you could just put some money in a stock, and wait 3 years for a profit.
Learn How To Trade Stocks And Be Patient
The fourth thing is give yourself some time to learn how to trade stocks, and be patient with yourself throughout this process. You got to keep in mind there’s no need to rush. Learning how to trade stocks can take months or even years. There’s people working from home interested in trading stocks, but 90% of new traders treat stock trading like a hobby, or gambling. Brand new traders often overestimate their knowledge and skills in trading, because they don’t have enough experience to see the inefficiency and volatility in the market. The more time you spend learning, the more you’ll realize what you don’t know. So if you’re new to trading give yourself the time you need!
