I scoured the internet and my texts to find some of the best inspirational and motivational quotes to instill in the most cynical, that they too, have the ability to succeed! Check them out, I call it, ShortMeTina's top 10!
I wrote an article a few weeks back outlining common mistakes new traders tend to make. If you missed it, find it here.
It is not uncommon for me to, at times, go back and review the articles I have written. In doing so with the article mentioned above, I realized I left out one of the most crucial pieces of being a successful trader.
I have written about it previously but always feel the need to revert back to the topic. The missing piece I am talking about is:
Original article published: 1/25/2016
I am a firm believer that in order for you to succeed in the stock market, you need to have an understanding of the markets.
Understanding... ...will lead to a level of comfort playing the markets. Once you’re comfortable in any situation (in this case, the stock market), you tend to operate better within it.
It is then fitting for me to summarize important data points about Bear Markets and Corrections of the past. This isn’t a deep analysis but rather a condensed view---
---A Quick Look Back!
Original article published: 1/18/2016
If you follow the financial markets ($SPY, $IWM, $QQQ, $DIA) like I do, you’re probably going through a period of extreme anxiousness about ALL the money you are losing or all the money you can possibly lose in the near future. No seriously, I cannot go more than a day without hearing something negative about the overall markets, the price of oil and the state of our stock market! Make no mistake; it’s not just confined to financial geeks, its hit Main Street. My close friends and relatives have talked about ditching their 401ks for the “better” option of sitting on cash until the market comes back.
All this talk about the possibility of the worse bear market in history and the impending doom got me to do some serious thinking. What conclusions did I draw?
Unless you were on a deserted island without any access to the world last week, you’re clearly aware that the global markets were in turmoil.
The Shanghai Composite, after their circuit breakers were triggered on two separate trading days, had to halt trading twice last week. With one halt coming 30 minutes after market open. It’s currently down over 15% from its month’s high.
While not as bad, we aren’t doing very well here in the USA. The Dow, S&P 500 and the NASDAQ are all down over 5% from their highs, with the NASDAQ retreating over 10% last Thursday.
Consider your mistakes a right of passage, as we’ve all been there. As a beginner, mistakes are almost inevitable. Below are the 4 mistakes I think most novice traders suffer from in their infancy stage; get familiar with them and do your best to avoid them.
Betting a hefty portion of their investment capital on one trade. The saying, “don’t put all your eggs in one basket” has passed the test of time for a reason. You hear it time and time again because there’s some truth to the phrase. Knowing this, don’t bet the farm folks. In the stock market, you essentially have a 50/50 chance. You’re either right on the trade or you’re wrong on the trade. Considering you have a 50% chance of being wrong; betting all your capital on one trade is just asking for trouble.
Take away: Come up with a comfortable dollar amount or percentage to place on each trade.