Common Trading Mistakes in Stock Markets

Trading in Stock Markets is a serious business after all we have Money at stake! Many novice & new traders enter the stock markets to make super quick profits but fail, some of them blow away their entire Capital. As we say we make mistakes in the process of learning. The beauty of stock markets is that after each trade you understand & learn about your mistake.

To be a successful trader you need to learn from your mistake & try not to repeat those mistakes again & again. Some of the common trading mistakes that most the emerging & novice traders do can be listed below:

1. Speculative Mindset

Most traders believe stock markets to be a place of gambling & they enter only to try their luck to make some speculative gains. But as they say, trading is a serious business don’t let the mindset of gambling mesmerize you.

2. Lack of Proper Trading Plan & Strategy

Everyone enters the stock market to make quick & hefty profits but most of them don’t have a trading strategy or trade plan. Lack of a proper. Trade Plan paralyses one’s ability to time the market & most traders fail as they don’t know when to Enter & Exit the Stock Markets.

3. Lack of Trading discipline

Discipline is the corner stone to success. If a trader rigorously follows a proper Trade plan with discipline no one can stop him from becoming a successful trader.

4. Emotional traits of Fear & Greed blocking your mind.

Two greatest enemies of a successful trader are Fear & Greed. Fear of missing out on a trade (FOMO) & Greed for getting more profits can be an emotional barrier between you & a successful trader.

5. Crowd Following & guessing

Most traders tend to make the common mistake of following other fellow traders without making proper research.

6. Trading without a Pre-Defined Stop Loss.

The most dangerous & common mistake that traders do is not to place a stop loss & as a result, they could not cut down their losses, as we say Stop loss should be in the system & not in the mind”

7. Poor Risk: Reward Ratio

Mis- calculation of Risk to reward ratio will not only slowly drain your capital but will also derail your confidence, so one should keep at least 1:2 times risk: reward ratio.

8. Over leverage trades

Don’t over-leverage your trade as a single mistake of oversizing can blow up your entire capital.

9. Changing Trading strategy

Most traders follow a cycle of trial & error method i.e. changing strategy after a few losing trades.

10. Risk Management

The core of every successful trade is Risk Management, if you master the art of managing your risk & cutting down the losses half of the battle is won.

Ticker MVT is the product of ticker and is the cross-asset market data platform in the financial sector. It can be integrated to provide real-time streaming quotes, market analytics, and news with information on international and domestic exchanges and OTC markets. Ticker MVT is a great way to be prepared for your investing journey.

Do your research and Happy Investing!

The information on this blog is provided for information purposes only. It does not constitute an offer, recommendation, or solicitation to any person to enter into any transaction or adopt any hedging, trading, or investment strategy, nor does it constitute any prediction of likely future movement in rates or prices or any representation that any such future movements will not exceed those shown in any illustration. Readers of this blog should seek advice regarding the appropriateness of investing in any securities, financial instruments, or investment strategies referred to in this blog and should understand that statements regarding prospects may not be realized. Opinions, Projections, and estimates are subject to change without notice.

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