Some days I wish, I could go back 10 years and teach things myself I wish I knew Before I Started Trading I’ve learned the hard way in the markets.. I was fortunate to make money early on thanks to the earlier bull market; I only wish I had known how to keep all of those profits and avoid a deep drawdown at the time.
After the internet bubble burst, I developed a strong aversion to losing money, and I’ve never held a losing position in anything for very long, whether it’s options, mutual funds, or stocks, which saved me from losing money. Because I would let the winner run for as long as it would go when I was correct about an entry and captured a trend, my aggressiveness helped me build large accounts. These were all positive qualities, but here are the ten things I wish I had known from the start when I first started trading.
These tips could have easily made or saved me seven figures:
- Less activity generally leads to more profits in trading, and smaller position sizes lead to better long-term odds of profit preservation.
- Focus on trading, Choose a market, Choose a method, and Master it.
- Trading is about limiting losses when you’re wrong and maximizing profits when you’re right, not about being right all of the time.
- Only check prices as needed for your method. For the vast majority of trading methods, watching every single tick is not optimal.
- You can make the big money in trends, not in the intraday range.
- Understanding the difference between what is noise in price movements and what is real signal is critical.
- Any trading method’s weakest Point is the trader who executes it.
- Long-term winners are usually the traders who manage risk the best.
- Only trade stocks, options, and liquid markets. A good system can become unprofitable due to large Bid/Ask spreads.
- You can make money in the markets if you trade in the direction of the trend for your time frame, manage the risk of ruin, and stay disciplined, but if one of these factors is missing, trading will cost you money, sometimes a lot of money.
These 10 Things I wish I knew Before I Started Trading. This may be very helpful to new traders.
Also read38 Steps In Journey Of A Trader