5 Practical Thumb Rules that Suit All Kind of Stock Traders
For the amateur or newbies in stock trading, getting the right guidelines is life-saving. The following are a few guidelines proved to be useful and practical in preventing losses and securing profits.
1) Make Your Trading Decision when the market closes. The reason for this rule is simple. Making your trade decision and strategies after the market closes to avoid emotional attachment. The knowledge of market could be learnt throughout the years but it is always the sentiment that inhibits you from reaping massive profits from stock trading. Avoid feeling of greed and fear! If you want to monitor your stocks, check the prices during lunch break or after the session of the day ends.
2) Focus on your Long-Term Goal and not the Short-Term ones. Don't be too harsh on yourself on one winning or losing trade. Focus on your longer term objective of investment rather than the short-term profits. A day-trader however, don't have to do this! Daily trades means daily review and techniques change more often. Longer-term finance weather and economical outlook don't bother day trader. Usually, day-trader focuses on daily attributes rather than the longer outlook.
3) Envision Your Financial Goal. Visualize your dream car, dream house or other quantitative dreams that motivate you. List down the dreams that you want to achieve in your life and paste the posters of the objects on your wall. See them everyday and visualize them in your mind. Motivate yourself from inner sub-conscious mind.
4) Don't Always Invest. There is a Chinese preaching that means : A good apprentice knows when to buy, a good master knows when to sell but the great grandmaster always take a break! Hence, keep some cash in your hand. There are always some opportunities to invest here and there. Keep a trading diary to manage your finance. Keep track of the record to diversify your investment and save some cash.
5) Learn Your Mistakes ! This is always easier to say than do! Normally, we learn from both earning profits and suffering losses. However, mistakes are more painful hence we learn more form them. Keep track of trading gains and losses in a book or excel page but don't write them on rough papers so that revision can be made.
2) Focus on your Long-Term Goal and not the Short-Term ones. Don't be too harsh on yourself on one winning or losing trade. Focus on your longer term objective of investment rather than the short-term profits. A day-trader however, don't have to do this! Daily trades means daily review and techniques change more often. Longer-term finance weather and economical outlook don't bother day trader. Usually, day-trader focuses on daily attributes rather than the longer outlook.
3) Envision Your Financial Goal. Visualize your dream car, dream house or other quantitative dreams that motivate you. List down the dreams that you want to achieve in your life and paste the posters of the objects on your wall. See them everyday and visualize them in your mind. Motivate yourself from inner sub-conscious mind.
4) Don't Always Invest. There is a Chinese preaching that means : A good apprentice knows when to buy, a good master knows when to sell but the great grandmaster always take a break! Hence, keep some cash in your hand. There are always some opportunities to invest here and there. Keep a trading diary to manage your finance. Keep track of the record to diversify your investment and save some cash.
5) Learn Your Mistakes ! This is always easier to say than do! Normally, we learn from both earning profits and suffering losses. However, mistakes are more painful hence we learn more form them. Keep track of trading gains and losses in a book or excel page but don't write them on rough papers so that revision can be made.
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