There are many pitfalls many traders make the mistake of falling into their overconfidence. RocketTrades believes that knowing the risks and avoiding recklessness is the key to preventing repeated failures. Here are some of the things you should steer clear from to avoid committing the same mistakes:
Underestimating hard work
People sometimes enter trading thinking it’s easy money. Trading requires not just capital, but more importantly DISCIPLINE, STAYING CONSISTENT and GREAT MENTAL STRENGTH.
Overanalysis Paralysis
Staying educated is good, but sometimes there’s too much information coming all at the same time that it leaves you frozen and unable to make decisions. It’s overwhelming! Whenever you find yourself worrying too much about what could be, just stick to your plan!
Not having a strategy that fits you
It’s tempting to just try out one strategy after another, looking for that “sure-win strat” but the truth is, there isn’t any! The best strategy is the one that has an edge AND suits you the best.
Poor risk management
Always watch how much you risk! Not even the best strategy will work if with poor risk management.
“Risk comes from not knowing what you’re doing.” -Warren Buffet
Not planning ahead
Trading is not something you can just go “wing it.” Having a trading plan is having a guide against making bad decisions. Without a trading plan, trading makes no difference with gambling.
Settling for less
You can never avoid losing, it happens to everyone. This simply means that you have to make your wins count. If you become impatient and settle for less than your targeted profit, you’re not earning anything.