Simple Stock Market Advice for the Wise Investor: Common Mistakes of New Traders

Stock market advice for all traders

So many people trade in the stock market everyday with the false impression that they have an equal chance at making money.

Many of these people that don’t earn a decent return simply do not have enough accurate information about trading in the stock market in general.

Why do a lot of new traders not earn returns during their first few years investing in the stock market? That easy…

The answer is usually emotions and strategies. Successful traders act without emotions, they have a solid strategy and follow the principles of their strategy to the word.

To have financial successes in the stock market, you should avoid some common mistakes and take some free investment advice. Here are the most common mistakes from new traders.

Investment Advice: Don’t make these Mistakes

 1. Lack of Strategy

Having a strategy in the stock market is very important. You should know when buy a stock, what is selling price or target price will be and how long you plan to hold the shares in general. When choose a strategy follow its principles, take notes, and do not change your strategy or you will lose track of whats working for you.

2. Waiting for Market

Thinking the market will change in your favor, with no mathematical or informational sources pointing that direction, is a common mistake made by new traders. Look at the market objectively mostly in the now. Predicting the likely future of growth will come with more experience.

3. Not taking the Profit

If you have made a substantial profit, and the stock begins to go down even slightly, don’t be greedy, sell it and take your gain.

4. Over-trading

Many traders, especially day traders, feel the need to hold all positions in the market at all times. Often they will break their own rules in order to get all of their capital into the market. Sometimes , it is best to stand aside and avoid holding any position in the markets at all.

5. Trading with money you can’t afford to lose

Don’t use money that you really can’t afford to lose. Examples of this would be money that is supposed to be used to pay the mortgage, bills or your child’s college tuition. This causes trading with fear and emotions clouding your judgment.

6. Falling in love with a Stock

Some people stick to a stock because they believe it is a good stock. They even lose a lot of money they have an emotional attachment and they don’t sell when they should

7. A way to get Rich Quickly

People will often expect to get rich in the market overnight, but they fail to realize that trading is like any profession; you must learn how to do it first.

8. Not adhering to a ‘stop-loss’ position

A stop-loss is a predetermined price point at which a loss is accepted and an investor closes the position.

Starting out making money in the stock market is hard, but if you avoid these common mistakes you will have a much better change at seeing decent gains in your portfolio.

Good luck with your investments and all your future endeavors. You may post any questions or comments below.