It's a new year, and you're probably intrigued by the immense profit potential in the markets right now. You see all the hype surrounding the current "hot button" sectors. Artificial intelligence... Quantum computing... Blockchain... The list goes on and on. Then you hear about your friends making profits... And now you want a piece of the action. But at the same time, you're also intimidated by the terminology, unsure of the risks involved and skeptical of your own ability. As a result, you haven't traded yet. Well... starting today, we're going to change that. Today, I will review the top mistakes new traders make - and how to avoid them. These are some of the first things you should check off your list before jumping into the market. They'll help you learn how to prepare yourself - mentally, emotionally and financially - to trade successfully. You'll also quickly come to understand how the right trading methods can tilt the odds in your favor. And most importantly, by the time you finish, you'll realize that you can - confidently - begin to harness the incredible profit potential of the stock market. Let's get right into it and not waste any more time. Here is the first big mistake most new traders make... Trading Mistake No. 1 - Jumping in Without Checking the Water First It's not a good idea to hop in a car and pull out onto the freeway without first learning how to drive. In turn, before you start risking your hard-earned money, it's critically important that you get familiar with trading. That's why I recommend that you set up a paper trading account. This offers you a number of advantages... First, you'll get familiar with how to enter and exit trades. Second, you'll get comfortable with the language. And third, you'll get all of your mistakes out of the way NOW - before you're using real money. For instance... Did you buy a put - instead of a call? Oops. Did you sell - instead of buy? Oops. Did you trade the March 1 expiration - instead of the April 1 expiration? Oops. These are all rookie mistakes that we'd rather you make now - in the preparation stage - when they don't cost you real money. Taking the time to do this exercise right now - at the start of your trading journey - will eliminate more mistakes and make you more money than anything else you could possibly do. At Monument Traders Alliance, we recommend the ThinkorSwim platform, but many of the big-name brokerages offer paper trading accounts as well. If in doubt, reach out to your brokerage's customer service department, and they'll show you the way. (Getting the customer service number is part of avoiding that first big mistake!) |
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