Deepstash brings you key ideas from the most inspiring articles like this one:
Read more efficiently
Save what inspires you
Save all ideas
Anything of value in life requires mental and physical efforts and involves time, energy, and resources.
Just like becoming a highly-paid doctor earning a six-figure income requires years of hard work, becoming a highly successful trader needs a decent capital, emotional strength and years of toiling.
Most ‘trading strategies’ that traders of all kinds keep looking for almost always backfire eventually. Even if it works for some, it may not work for us.
One needs to see what strategy is good both in the market and with one's personality to be able to get any benefit.
While the glitz and glamour of trading are attractive, if we are having poor risk management skills, and fail to calculate the risk in each trade, it can accumulate and erase your trading account in no time.
The chess game of trading requires a good defence.
Just like we cannot over-speed indefinitely in a highway with traffic, we cannot keep our winning streak in trading going on forever.
We have to put the brakes (Stop Loss) to ensure we don’t go down with the ship in a sudden plunge. Trading is about probability and it is good to know that there is always a possibility of loss in each trade.
Most traders enter the business of trading without a plan. This is the equivalent of driving a car without being sure of one’s destination.
Having a trading plan keeps you on course and helps you reach your desired destination. It allows you to filter and analyse what is working and what needs reworking.
SIMILAR ARTICLES & IDEAS:
Trading of stocks and bonds has many variables and the uncertainty can lead to fear and anxiety. Fear is the biggest hurdle to overcome in this otherwise lucrative way to earn money.
The most common fear is the fear of the unknown, where uncertainty and lack of knowledge of the forces at play can lead to a feeling of gambling away one’s money.
This fear can be overcome by expanding one’s knowledge about trading by taking a course or reading relevant books.
We are hardwired to be right and are awarded throughout our life pursuing what is right while being punished if we are wrong. From an early age, we learn to avoid the embarrassment of being wrong.
Trading success does not rely on one being right all the time or even on the IQ of the person. The outcome is equality reliant on the emotional makeup of the person.
... is a somewhat overlooked discipline that occupies the space between psychology and behavioral economics. Advertisers and marketers trying to tempt us to spend money are well aware of it.
Lovers of risk, anxious investors trade frequently and believe they have the edge over others. Many have absolutely no idea what their returns actually were and only remember their good decisions.
For hoarders, money represents security. They abhor risk and may even stockpile cash that they would probably be better off investing — or even spending.
Find an advisor you feel comfortable with who can discuss the right investment approach — and level of risk — for you.
Political science professor Elinor Ostrom showed that common-pool resources, such as water supplies or fish, can be effectively managed collectively without government or p...
The economic theory of expected utility maximization says that people will act out of rational self-interest. But psychologist Daniel Kahneman showed that it is incorrect.