The novice traders are always one step ahead when it comes to trade execution. They want to execute more trades as they find it entertaining and profitable. But after trading the stock market for few months, they ruin their investment and blames the market. Earning in the stock market is a very challenging task and you must learn to take the trades with strict sets of rules. Unless you follow the proper order, you will never learn to execute your trades in a systematic way.
Many novice traders often say, no one can make a consistent profit in the stock market. But this is not all true. To become successful in the stock market, you have to know the key reason for which you are struggling. Only then you can expect to become a profitable stock trader.
Lack of knowledge
The rookies don’t have enough knowledge about the stock market. In most cases, they are taking the trades in a random way and trying to make a big profit. But the trading industry doesn’t work like this. You have to be a knowledgeable trader to find reliable trades in the market. Only then you can expect to become efficient in the trade execution process. Though it will take some time to learn about the basics of this market once you know everything about this market, you should be able to execute the trades with the high level of precision.
Lack of discipline
Breaking the core rules of the investment business is one of the key reasons for which people are losing money at trading. If you want to survive in the stock market, you have to create written rules. You can’t take the trades with an emotional approach because if you do so, you are going to lose money in most cases. You may also invest some money to learn the basics of stock trading from a professional trader. This is a great way to become skilled in the trading business. But never rely on theoretical knowledge only. Test your skills and confidence level by taking the trades in the demo account.
Trading with the bad broker
To survive in the stock trading business, you should always trade with the best broker like Saxo. Unless you chose your broker wisely, you will start facing many technical problems. The rookies often think they know everything about the market and they can easily make a big profit. But this is not how the trading industry works. To survive in the retail trading business, a trader has to work on long-term goals and take the trades with the top broker. Unless the trader trade with a good broker, they will also face many issues while withdrawing a big profit. But these problems can be easily solved by selecting the broker properly.
Ignoring the market trend
Smart traders always trade with the trend. They know by trading against the trend, they will increase the risk exposure in the trading business. Learn about the different phases of the market trend and try to take wise decisions without having any major problems. Take your time and learn to evaluate your market data in a systematic way. Once you become good at analyzing the market trend properly, you should become more confident with your trade execution process. Thus riding the major trend will not be a tough task.
Using high leverage
You should never trade the market with a high leverage trading account. If you take the trades with a high leverage trading account, you are going to mess things up. Though you will secure some big profits, the losses may wipe your entire trading account. Try to trade the market 1:10 leverage and if possible use 1:5 or less leverage. Take smart decisions in a calculative way and find a way to reduce the risk profile in the trading profession. Once you learn this technique, you should be able to trade with confidence.