TABLE OF CONTENTS
1. INTRODUCTION
2. MISTAKE ONE: Lack of Knowledge and No Plan
3. MISTAKE TWO: Unrealistic Expectations
4. MISTAKE THREE: Listening to Others
5. MISTAKE FOUR: Getting in the way
6. MISTAKE FIVE: Poor Money Management
7. MISTAKE SIX: Only Trading in One Direction
8. MISTAKE SEVEN: Over Trading
INTRODUCTION
Here is a list of faults that beginners in stock market usually commit. These are very common mistakes that eventually result in financial disaster. Investors who recognize and avoid these SEVEN common mistakes give themselves a great advantage in meeting their investment goals.
MISTAKE ONE
Lack of Knowledge and No Plan
It is amazing that some people expect to trade the stock market successfully without any effort and plan. Yet if they want to take up golfing progress in the market , they will happily take some lessons from an inexperienced person or at least read a book before heading out onto the courses.The stock market is not the place for the ill informed. You can earn a lot of money and you can loose as well. So we have to be careful. But learning what you need is straightforward – you just need someone to show you the right way. The opposite extreme of this is those traders who spend their life looking for the Holy Grail of trading! The truth is, there is no Holy Grail. But the good news is that you don't need it. Our trading system in India is highly successful, easy to learn and low risk. So the knowledge and proper planning is deeply required in this field.MISTAKE TWO
Unrealistic Expectations
LETS GET REAL FOR THE MOMENT
Many novice and new traders expect to make a huge amount of profit within a very short amount of time. And when they do not get the required output then become totally frustrated. The stock market can be a great way to replace one's current income and for creating wealth but it does require "TIME". Not a lot, but definitely for sometime.Other beginners think that trading can be 100% accurate all the time. Of course this is unrealistic. So unrealistic expectations in the stock market can often make a doom.
MISTAKE THREE
Listening to Others
When traders first start out they often feel like they know nothing and that everyone else has the answers. So they listen to all the news reports and so called "experts" and get totally confused. And they take "tips" from their buddy, who got it from some cab driver. So, as far the stock market of India is concerned listening to others and then taking a decision in case of buying or selling a share will not be profitable at all.Through the proper technical analysis with a suitable software(like MetaStock & AmiBroker) and with some real time data feeds from companies like www.rtdsdata.com or www.esignal.com one can be able to trade in the stock market easily and earn maximum profits.
MISTAKE FOUR
Getting in the Way
GREED AND FEAR CAN MAKE YOUR PAY FOR IT
By this we mean letting our ego or our emotions get in the way of doing what we know and what we need to do.When you first start to trade it is very difficult to control your emotions. Like for Intraday traders, fear and greed can be overwhelming. These are the two main hurdles that one face in case of day trading. Lack of discipline; lack of patience and over confidence are just some of the other problems that we all face. It is critical in understanding how to control this side of trading.
MISTAKE FIVE
Poor Money Management
It never stops to perplex us how many traders are unaware of the critical nature of money management and the related area of risk management.This is a critical aspect of trading. If you don't get this right you not only won't be successful, you won't survive! Fortunately, it is not that complex to address and the simple steps we can show you will ensure that you don't "surrender" and that you get to keep your profits.MISTAKE SIX
Only Trading in One Direction
Most amateur traders only learn how to trade a rising market. And very few traders know really good strategies for trading in a falling market. If you don't learn to trade in "both" sides of the market, you are significantly limiting the number of trades you can take. This will limit the amount of money you can make.
MISTAKE SEVEN
Over trading
Successful traders do not over trade
Most traders new to trading feel they have to be in the market all the time to make any real money. And they see trading opportunities when they're not even there. But this isn't the fact. There are many generalized facts that may prove it absurd. Successful traders know the right time to trade and in the right amount as well and wait for the opportunity to cash in.