Newbie Do- Read, Learn, Ask Questions, Practice
You will hear it a lot from traders who started trading without taking much time to Learn before they started trading, they learned 'the Hard way' from having losses. Take the time to read and learn as much as you can about trading, money management, technical analysis, psychology, etc Before you begin to trade. If you are not sure you understand something then Ask questions. There are Many sources of information on the internet and from people on iHub that can give you insight to whatever you do not understand, if you ask. Once you feel you have a good understanding of what it takes to trade then Practice. Do not use real money but paper trade some stocks with what you have Learned to see if you can Successfully apply it. If you can Successfully paper trade some profitable positions then you can start to Consider using real funds. Give yourself some Time to make sure you have been through different market situations. Applying what you have learned can be different in Bull or Bear markets. Make sure you know the difference and how to recognize price trends so that you are not fighting against the prevailing trend with your trades. If you can have Successful paper trades and can recognize different stock and market conditions to trade then you will be ready for the move to trading with real funds.
The markets are like a calm pool of water with dollar bills floating on the surface for you to reach down from your boat and scoop up with your hand. What many don't realize is that underneath that pool of water is a sleeping alligator waiting to take your hand off if you are not careful.
Newbie Don't
NEVER risk more than you can afford to lose. If you have $100 to put into the markets consider that you will be risking a night out dinner and a movie for the entire family, or something comparable, that you will not be able to Enjoy if you lose those funds. Your savings are your lifeboat and if you choose to cast it out on the calm pool of water and are not careful the sleeping alligator can be more than happy to tear out the bottom of the boat and leave you swimming to stay afloat. NEVER borrow money to trade, otherwise you are just borrowing someone elses boat to sink and you will have to replace it somehow when it is gone. When you are considering whether to Risk your money in the markets consider what other Useful things you could do with that money and that if you make a mistake you will Not be able to use the money for those things. Many who start trading do not realize how quickly a few small losses can accumulate to Large losses, or how Big that One loss might be. I know that I did not when I started trading in 1987, and again in 2000. I did not study much, learned only a little ahead of time, "Hey, markets are going up. What else is there to know?", paper trades all were profitable, and had my boat sunk within a year of trading on One trade that went bad. Take the time to Learn and Practice what to do Before you use real funds. Learn how to make your trades Safe with stops and hedges. It might take you a year or two to become comfortable with what to do in different situations but that is a short time to study to have the next 20-40 years, or more, to trade Successfully.
I hope this Helps. Sincerely, Bob :^)
Good Luck to All! :^)
PLAN the TRADE and TRADE the PLAN!
