The Most Common Trading Mistakesby Alexander james Blooger
The financial market is full of opportunities for those traders who think well before acting on things. There is a fine line between the loser and successful trader. The success in trading comes from adopting the strategies carefully and never repeating the same mistake twice. The strategies of all traders are different and so are their experiences. Here we have presented a list of some of the common mistakes which generally investors make. Try to avoid them to harvest most out of the market of opportunities.
most common mistakes which traders usually make
Change the techniques of trading after losing five trades in a row
Losing in the financial market cannot be avoided, and even the best investors will generally realise losses. Most traders change their approach after losing a few trades in a row. It sets the trader again on the learning curve. Hence it is essential to stick to your techniques your chance will reduce automatically.
Not anticipate the unexpected
A sudden collapse in the financial market can lead you in the loss. It may include the unexpected event or news for the market or loss of connectivity of your internet. Be prepared for these events and try in the direction that no single trade can wipe out your hard-earned or the trading account. If this happens, it simply means that I still lack the basic knowledge of risk management and its techniques.
Not reading the authentic new from trusted sources
It is critical to stay updated with the financial news, but try to read the new only from authentic new channels or papers. One single fake news can transform your profit into an unbearable loss.
Not being prepared
A trader should always have a proper plan for the upcoming or unforeseen difficulties which he might face. He should be aware of all the risk management strategies, tools for risk management and last but not the least the use of the technical indicator.
Not performing the analysis for post-trading
Usually, the traders do not analyse the trade after they have finished trading. It is the place where they make a mistake. One should always look for the factor which leads to profit or loss while trading. It is the attribute of a successful trader.
Not understanding the distinction between short term and long term perspective
Anything can occur over the short interval of time. A trader cannot manage the outcome of his trades. Also, he cannot predict the result of the next one, two or ever seven trades. But, when we consider the long trade, these things do not matter. If a trader has a trading technique which has a positive prospect and obeys it religiously, the only likely result is making money.
A low stop-loss indicates the smaller risk
The distance or intensity of stop-loss does not have any relation with the potential risk of the trade. Risk is estimated by the potential loss of the online trading account. A trader should set the stop-loss intensity according to the trade size and profit distance to build an idea of risk.
Measuring the performance of trade in pips
The sign which reflects that an investor does not know anything about trade is when they start comparing or measuring their gains with the value of pips. Estimation of pip is random and does not have any relation with the performance of the trade. They are relative.
Failing to adjust to varying markets
Many traders think that once they get the path to make money from the trading consistently, their work in the trading market is over. But the reality is far beyond this thinking. The Financial market keeps on changing every day. If one fails to adjust or adapt to these changing financial market situations, then shortly, the market will kick you out of business.
Allowing the hindsight to influence the trading
Novice investors analyse the trade after exiting from the trading position, and after this they regret. Other times they look for and investigate the reason which leads to failure for changing the entire trading approach. It is not the right approach. The professional and educated traders gather data and make their decision based on these data and collect the large sample size for making the decision.
Choosing the wrong broker
The financial market is full of all types of the brokerage firm, including both the authentic and the fake ones. The fake ones target your hard-earned money and try to lure you by providing the best services at a cheap rate. But, remember no one can offer you the best services at the lowest rate because, of course, no one will bear the loss for the person he hardly knows. So, choose the brokerage firm wisely by monitoring everything related to its regulation, licence number, registration number, and parent company, services, trading charges and term and conditions before opening a trading account with it.
Selection on the best broker depends on various factors such as the trading platform offered by the broker, the features and platform it is providing, the charges and most importantly whether the broker is authentic or not. Many traders fall in the trap of fake brokers and hence end up by nil balance in their trading account. So, choose wisely. Here are some top and authentic brokerage firms like TradeATF, HFTrading, PrimeFin, Brokereo. These all brokers are safe and reliable and trusted by thousands of active traders.
Created on Apr 28th 2021 06:34. Viewed 113 times.