A Secret Revealed: Why Most (Day) Traders Fail
The following perspective on (day) trading comes from my many years of experience of active day trading or being the moderator of one of the largest day trading chat rooms on the Internet.
One of the biggest problems I see with new traders (and even some old ones) has nothing to do with the software or the broker they are using. Nor is the problem a result of buying too high or selling to low; or not having enough money. The problem isn't any of those things.
It has to do with not having a trading plan. A good trading plan will go a long way towards solving the problems mentioned above.
Ted Williams was once asked how he hit the baseball so much better then everyone else. He said he had no idea and that he just went up to the plate and swung at the ball. There has only been one Ted Williams and as great as he was at hitting a baseball, I don't think he would have made a great day trader with that approach. Most great hitters have an idea what they are going to do every time they step up to the plate. Traders need to know exactly what they expect every time they enter a trade.
Everyone should start out with a basic trading plan and use it. As the old saying goes, "Plan your work and work your plan". However, you also have to be ready to be flexible. That has to be part of your planning. As Clint Eastwood said as his character in "Heartbreak Ridge", "You got to adjust, you got to learn to improvise. And if all else fails, you to learn to survive!" Traders that are not able to make adjustments, improvise and survive will experience their own Heartbreak Ridge.
Your trading plan can't be one where you simply figure you are just going to follow someone else. That may be one way to get a start and a bit of experience, and it can be a part of a much bigger overall plan. But it cannot start and end there. You have to learn to trade on your own so you don't accidentally follow someone off a cliff. You have to know who to follow and who not to follow.
When I was trading I made a lot of good trades knowing who to follow and who not to follow. Yet, in the long run, I do not believe you can make a living doing that. The biggest problem in following other traders is being too far behind the trade because you are "following" and not leading. I think each and every trader has to become the very best trader he can possibly be, on his own. He needs to get there as fast as he can. Following more experienced traders can be a means to this end and can help get you started, but it cannot be the end. This takes planning.
A basic trading plan will take in your long-term goals and objectives as a trader. You'll have to decide if you want to try to make a career out of trading, or just be a part time trader. Once you have decided this you can make other decisions such as how much money you would like to make at either full time or part time trading. Your money goals have to be realistic. They can't just be, "I want to make as much money as I can". These basic decisions will determine the time and money you will have to commit.
Your trading plan should be on going, constantly evolving and eventually contain things like how many days, weeks, and hours you will need to trade to meet your goals. If it is as detailed as I think it should be, you would know how many trades per day and how much profit per trade you will have to average. Of course, these things will have to be developed over time and added to your plan as you go and as you gain more knowledge.
There are many excellent books on learning to day trade. My favorites are found at http://www.TraderAide.com/books
No permission is needed to reproduce an unedited copy of this article as long the About The Author tag is left in tact and included. We do request that we be informed of where it is posted and reciprocal links will be considered. Email email@example.com.
Floyd Snyder has been trading and investing in the stock market for three decades. He was on the forefront of the day trading craze that swept nation back in late 1990's both as a trader and later as the moderator of one of the Internet's largest real time trading rooms.
3 Mistakes High Net Worth Clients Make When Investing The Motley Fool
10 Best Investments During High Interest Rates Yahoo Finance
Twenty-Five Years After LTCM, Emerging Markets Keep Burning Investors The Wall Street Journal
SAFE Banking Act Hits a 'Sweet Spot': This Week in Cannabis Investing - Kiplinger's Personal Finance
SAFE Banking Act Hits a 'Sweet Spot': This Week in Cannabis Investing Kiplinger's Personal Finance
Chinese investors in scramble to offload overseas property portfolios South China Morning Post
As CD Rates Top 7%, Financial Planners Explain: Save Cash or Invest? Business Insider
Investing in India's Stock Market and More | White Coat Investor The White Coat Investor
Huge News for Disney Stock Investors The Motley Fool
PhonePe's New Stock Broking App Makes Investing Accessible to ... Walmart Corporate
President's Investing in America Agenda Provides Resources for ... US Department of the Interior
SEC Brings Much-Needed Transparency to Sustainable Investing Environmental Defense Fund
10 Best Blue-Chip Stocks to Buy for 2023 | Investing | U.S. News U.S News & World Report Money
Palliative Care Remains 'Wild West,' But Home Health Providers Are ... Home Health Care News
Lithium Stocks Down 38% to 49%: What Investors Should Do Now The Motley Fool
A More Impactful Strategy for Sustainable Investing HBR.org Daily
Legislature deserves thanks for investing in NH's youngest learners ... New Hampshire Bulletin
Massive News for Nio Stock Investors The Motley Fool
Kresge joins Quality Jobs Fund in investing millions in The 22 Fund ... The Kresge Foundation
10 Best Investments for 2023 | Investing | U.S. News U.S News & World Report Money
How to Invest in Carnival Cruise Lines The Motley Fool
How Panama Canal Supply Chain Issues Impact Shipping Stocks U.S News & World Report Money
Neal Logan: Should you invest … or speculate? | Business ... Cleburne Times-Review
Finding emerging opportunities in sustainable investing PitchBook News & Analysis
Opinion: United Way leaders call for investing in change Akron Beacon Journal
Stripe, Instacart show perils of secondary investing PitchBook News & Analysis
The Gulf Sovereign Wealth Funds: Accumulating Wealth and ... DBRS Morningstar
Just Started Investing? Here's 1 Solid Company to Buy With $200 The Motley Fool
How to Coach Investors Through Choice Overload Morningstar
Farming Investing Outlook EisnerAmper
Harry Domash, Online Investing | Exchange-traded funds offer positive returns in down market - Santa Cruz Sentinel
Harry Domash, Online Investing | Exchange-traded funds offer positive returns in down market Santa Cruz Sentinel
22-year-old who lost $80,000 in crypto: 'I was investing with money I didn't necessarily have' - CNBC
5 Stocks You Can Confidently Invest $500 In Right Now The Motley Fool
'Magnificent Seven' investing playbook: Amazon's opportunities 'the same as its challenges,' analyst says - Yahoo Finance
'Magnificent Seven' investing playbook: Amazon's opportunities 'the same as its challenges,' analyst says Yahoo Finance
Investing in the radical reorientation of health systems towards ... World Health Organization
The Week in Impact Investing: Legacy ImpactAlpha
Is Now a Good Time to Buy Stocks? Warren Buffett's Sensible ... The Motley Fool
The Impact of Investing in Faculty · Babson Thought & Action Babson Thought & Action
8 Top-Rated Income Funds | Investing | U.S. News U.S News & World Report Money
A local company is investing $10 million in an East Tennessee ... Knoxville News Sentinel
Up 125%, This Blue Chip Stock Has 1 Key Advantage That's ... The Motley Fool
Investing in Emerging Tech GovernmentCIO Media & Research
Got $3,000? 3 Tech Stocks to Buy and Hold for the Long Term The Motley Fool
Where to Invest $10,000 in a Bear Market The Motley Fool
These 2 Dividend Stocks Are Investing in This Niche Industry ... The Motley Fool
Data Driven Investing in America: New Tools Help Advance ... Economic Development Administration
Brain Snappers and Other Wall Street Nonsense
The last time you spoke with your broker did he use any of the following words? Diversification,Price-to-earnings ratios, discretionary trading,lifting a leg (he's talking to you not yourdog), leverage, divergence, fee-basedcompensation, escalator clause, tactical assetallocation and other mesmerizing words to placeyou in stupefying shock.Brokers do that to let you know that you don't know anything about the market and you mustallow them to make decisions for you.
Trading Tips No 4: Technical Analysis The Holy Grail Syndrome
Everyone knows that the Holy Grail of investing and trading is a myth. Finding a good technical analysis tool that will give you a trading system that wins all the time is called the holy grail of trading.
The Dreaded Direct Question
(Please have a glass of water within reach before reading this article.)Your personal financial planning is the topic of discussion here today, but not quite yet.
Discipline in Trading and Investing
The one thing I can think of that most affects both trading and investing has to be self-discipline.Being disciplined is fully 50% of the job of trading or of investing.
I've been in and interested in the stock market so long (one year shy of forty years) I can remember when the mutual fund pages in my home town paper were just one page! Now it looks like there are more mutual funds then there are stocks listed on the New York stock exchange.I wonder how many billions of investor dollars are supporting these funds.
Investing Online Has Its Rewards: Find Out How To Take Advantage Of Them
Computerized investing. Online investing.
Options Education : Opinion versus Fact!
The most basic aspect of trading is learning to differentiatebetween what is FACTUAL and what is OPINION. If you stayinterested in the financial markets long enough you willdiscover that there are a lot of sharks out there who havebecome expert at making that task very difficult.
Use this Simple Trick its to Buy $100 Bills Direct from your Bank for only $97
Most People just don't understand the power of using their home as a Wealth Creation Tool. How many people do you know who have lived in the same house for 10, 15 or more years and have virtually no mortgage, You know the Type 'House Rich Cash Poor'.
New U.S. Mint Coins a Golden Opportunity
In April, the U.S.
Preparing to Invest: How to get started
Investments can be a source of great potential earnings. The two most common reasons that a person does not invest are either they do not have the money or they do not know how to get started.
The Demise of Buy & Hold
Based on consistent results I think Buy & Hold should be renamed Buy, Hold & Bye-Bye. It sounded great for a while, especially for the huge majority of investors who don't have the time or interest in really doing due diligence on investments.
The High Price of Oil
In less than four years, the price of oil has risen about 300%, or over $50 a barrel. The Light Crude Continuous Contract (of oil futures) hit an all-time high at $67.
How to Choose the Right Share Class
You'll want to opt for the no-load or institutional share class instead. If you're a no-load investor who is determined to buy a fund that's primarily broker-sold, go through a supermarket and opt for the D shares.
Before You Start Investing
There maybe several reasons why you to want to invest your money. You may want to retire early, want to build your own business in the future, or to pay for your kid's education.
The 8 Biggest Mistakes When Designing Portfolios - and How To Avoid Them
Are you as good an investor as you think? Do you consider yourself a well-informed investor able to anticipate and avoid nearly all pitfalls associated with investing? Chances are, you are making one of the common errors that could cost you hundreds or even thousands of dollars, or worse yet, your financial independence, control and security."I see people making the same costly mistakes over and over," says Scott Frush, CERTIFIED FINANCIAL PLANNER and author of Optimal Investing: How To Protect and Grow Your Wealth With Asset Allocation (Marshall Rand Publishing; available by calling 1-800-247-6553).
Investing and the Fear of Regret and Greed
People tend to feel sorrow and grief after having made an error in judgement.Investors deciding whether to sell or buy a security are typically emotionally affected by whether the security was bought or sold for more or less than the current price.
My Way Or The Highway: Give Your Financial Professionals A Good Talking To!
All this talk about Investing is encouraging lately. Over the last few years, more people have become interested in the duty to invest there money, then ever before.
Larry, Moe and Curley, Investment Brokers
Larry, Moe and Curley were sitting in their favorite restaurant just off Wall Street having their usual 3 martini lunch and were discussing the day's events and their client portfolios.Larry:"I had 12 calls this morningfrom customers wanting to know why the market was going down".
Success Trading: Yet More Basic Terminology for New Traders
In this day and age of online brokers for virtually every market out there, there are some very useful tools that will help protect your account and lock in profits when you have them. It is our recommendation that you use a good online broker and take advantage of not only the low commissions they offer, but also the automated tools that are available.
Many people today are looking for annuity help. The biggest challenge seems to be that most of the help is biased.
|home | site map|