ARE YOU CUT OUT TO BE A DAY TRADER?
Do a Google Search on day trading and what you’ll quickly realize, is there’s a ton of information on the topic. The sad truth is there’s also a lot of BS! If you’ve been thinking about quitting your day job and become a day trader after seeing someone’s online course, think again. To be effective at day trading, there is no ‘get rich quick’ scheme. Professional day traders understand things like how and when to exit. These penny stock ninjas are clear on what their position entails. While they may seem like money wizards, they are masterminds who have strategies in place. It’s true, about 95% of day traders will end up losing their investment to the FOREX before rolling around in billions of dollars. If you’re still on board with being a day trader, then read on because those who do can earn a 6-figure income without ever stepping foot in a university. But, first, let’s talk about what day trading is and what it isn’t. Scroll down.
DAY TRADERS WORK FROM HOME AND HAVE POTENTIAL TO MAKE BANK!
Day Trading is a field where you can work from home and make some serious coin. However, day trading is also a career where you need to have some intel on what you’re doing. Otherwise, you can watch your money get sucked up by the liquid market. In fact, if you aren’t anticipating losing money, this might not be the job for you. While it’s important to use passion for the market, it’s also vital to use caution. Moreover, if you’re new to day trading, you need to be clear on how to determine your profits and losses otherwise, you could lose your shirt and your house!
WHAT DAY TRADING ISN’T
Day Trading isn’t a scam. It’s not a gamble (although the casino might be more suitable for most). Day trading is not a secretive, underground organization for gifted stock brokers. The more you understand and treat day trading with its due respect, the less your chances will be run over by bullish markets. Now that you know what day trading is and isn’t, it’s time to get down to the sobering truth.
THE LONGER YOU’RE IN, THE MORE MONEY YOU CAN MAKE
The longer you stay in the market, chances are the more successful you’ll be. One day you might have $5,000 in your bank account, and within the next hour, you might be in the hole $500,000. Whatever the case may be, putting on a trade is anything but exciting. When people throw money at putting on a trade or entering the business and know nothing about it, they tend to freak the f@*K out as they aren’t prepared. While most investors, find the idea of making a lot of money intoxicating, the real deal is those who persevere seem to be more prosperous.
ANYONE WHO FOLLOWS THE RULES, CAN BE A DAY TRADER
Another factor to consider, is you don’t have to be a ‘stuffed-suit’ to be a day trader. Students, doctors, machinists and even stay-at- home moms hold the position as a professional day trader! As a matter of fact, it’s one of the most lucrative ways you can make a living without having a degree. At this point, you’re probably asking yourself “So, why don’t more people do this type of work?” We have an answer.
IF YOUR PALMS BECOME SWEATY THINKING ABOUT MONEY, DAY TRADING MIGHT NOT BE A FIT
The answer why not more people dive into this type of career is because most people don’t understand and use a strategy that works for them. They become anxious while reviewing charts, graphs. Their palms may become sweaty when hitting the enter button on the keyboard. They drive themselves into an emotional abyss all the while watching their money vanish into thin air. In addition to the high anxiety most apprentice day traders experience, they take the advice of other neophytes who make a poor judgment. Sure, there’s plenty of fortunate novices, but if you want to be a champion, you must be prepared to do the work.
WORK OF SCOPE OF A WORKING DAY TRADER, HENCE THE WORD ‘WORKING’
To illustrate what doing the work means, pay attention to what I’m going to present next. You will be reviewing about 200 or more charts per day. You will determine what your position or how much money you are okay with losing. You will be monitoring what’s happening on the securities and stock market consistently. Day traders also educate themselves on both big and small companies to find the best top and bottom spots. All the while these individuals keep things simple and try not to complicate or muddy the waters. Day traders also determine where their comfort zone is the risk involved. Calm, cool and collected are the mottos of the day when you take on this type of career. As the ole’ saying goes “he who cares least, cares best.” The day traders who have longevity in their careers are also not emotional over their profits and losses. If this sounds like you, then perhaps you might be ready to start. If this doesn’t look like you, then exit now because what I’m about to tell you might blow your mind.
DON’T BELIEVE THE HYPE, FOLLOW THE STRATEGY
It takes approximately 3-5 years to become a successful day trader. However, most people fall prey to newsletters and false rhetoric regarding how day trading is done. Whether you’re looking to invest in penny stocks or hit some other securities, you need to allow yourself the time required to plan properly. There’s a lot of common mistakes people make when dealing with forex. These include the following: • Impatience • Becoming Over Emotional • Not understanding trade costs • Not learning how to balance between high strike rates and substantial loss • Either not understanding the system or worse yet, not having one at all • Balance for trading too much or too little • Not setting profit and exit targets • Not managing your portfolio • Steering away from your game plan These factors can all deter you from making a profitable living. Impatience is one of the most common among blunders of new traders. While we touched base earlier on becoming overly emotional to the outcomes, many “green-peas” cannot disconnect their feelings and end up making poor decisions.
YOU NEED A FULL UNDERSTANDING OF THE COST
Beyond the over indulgences of perception, new day traders also don’t understand the real cost of what they are investing. The wider the spread, the higher the price. Be sure to factor this into your strategy, or you could end up in some serious doo-doo.
BALANCE YOUR STRIKES AND LOSSES
With high strikes and massive loss, there needs to be a balance. What you always need to look out for its high profitability and not become over excited about a high strike.
OLD-SCHOOL SYSTEMS DON’T ALWAYS WORK
Most people assume you buy low, sell when high. While there may be some truth to that old ass rule, understanding the system you’re working is more viable. Only rookies go into day trading without a system in place. The pros will outweigh the cons when they not only use a system, they get it and use it correctly.
TOO MUCH OR TOO LITTLE CAN MAKE YOUR END-RESULT ASKEW
Many new comers who want to learn day trading, either trade too much or too little. Granted it takes some time to understand your balance. However, when you understand your risk, you won’t become overwhelmed by the multitude of options at your fingertips.
WHEN DO YOU EXIT?
One of the biggest pitfalls day trader’s experiences when new is not setting a profit and exit mark. Even some experienced traders will forget to set volatility moves. You need to know exactly when you are going to fold and no matter how positive things may appear, you back out when you reach your target. Same with profitability, don’t assume this money is always going to be there. Take the job seriously and forget about the quick fix. It is endurance that makes day traders win!
GOOD HOUSEKEEPING IS VITAL TO SUCCESSFUL DAY TRADING
Things such as managing your portfolio and steering away from your game plan are just plain lethal to your progress. The sloppy organization, not keeping records or following daily routines will only get you one place. On the contrary, living on the streets isn’t fun. If you’re new to the game of day trading, then get up in the morning and spend your time wisely. Taking care of your business is a big responsibility. But, it’s also worth it when you get to spend time on the golf course each day, or in a mansion you purchased. Take your pick; this shit is real. Now that you’ve learned some interesting facts on becoming a day trader, you’ll want to keep your education going. Sign up for our weekly updates and be informed on industry procedures, tricks, and other tips to help you be a success.