Expensive trading habits can result in big losses. Here are the 6 Most Expensive Trading Habits of New Traders:
1.Trading with no stop losses.
You can’t control your profits, but you can control and limit your losses with a well-planned exit. When a trend turns against you and you start hoping instead of cutting your losses and moving on, not having an exit strategy can be very expensive.
2. Your opinion can be very expensive.
Trading your opinion against the opinions of all other market participants can be very expensive. The market goes where it wants, and if you disagree with it, it will cost you.
3. Egos are expensive things.
A trader’s inflated ego causes them to prioritize proving they are right and refusing to admit when they are wrong. Ego gratification comes at an expensive cost when it comes to making money.
4. Trading Off Prediction
When trading off predictions is incorrect, it can cost a lot of money. There is more money to be made by reacting to what the market is doing rather than predicting what it will do later.
Stubbornness causes small losses to balloon into big losses. It causes a trader to make the same mistake over and over again because they do not assimilate feedback and continue to do the same thing with the same results.
5.Not having an exit strategy
It is possible to ride a big winning trade into being a big loser if you do not have a set way to take profits if you do not have an exit strategy for a winning trade. Profits can be made by using trailing stops and targets.
6.Trading too big of position sizes
Trading with position sizes that are too big for your account size can be very costly because, no matter how good your winning trades are, you are set up to give back the profits with a few big losing trades.
calculated trading habits for new traders are very important to avoid risk.