SOME BASICS FOR TRADERS IN STOCKS
Trading in stocks is not an easy thing. It needs patience, courage, fast decision-making and of course, risk-bearing capacity! To trade in stocks, there are some basics which every trader must keep in mind. Let us know about some of them.
1. PREPARATION: For trading in stocks, you must have preparation well before. What happened in the global markets, Indian market, political scenario etc., you must well aware of these things, along with technical indicators. If you have done some home-work, at least half-an-hour before the start of the markets, it will be very much helpful for you and you can have idea on which stocks to be traded in on the particular day.
2. LIMIT YOUR TRADES: Like many other obsessions like race course, cards, casino etc., the trading is also a gambling as well as more dangerous obsession, where losing your entire money is always possible. So be cautious and always do not go for much number of trades. Fix the number of trades before you start the day and limit to that, so that you would not lose money so easily.
3. ALERT: Be alert with your entry and exit levels and also maintain strict stop loss. At any time you should not neglect these three things in day trading and if at all, on any day these are not working out well for you stop to trade for that day.
4. NO REVENGE: Do not try take revenge on market. After all, market is many traders and investors like you, your loss may be encashed as profit by another trader and also vice versa. If you are not doing well on a day, do not go for trading desperately to take revenge and earn back your entire money. It is not at all possible. So you have to give some gap. Relax and trade again or else try on the next day.
5. CHECK YOUR MOOD: At times, you may not concentrate on trade well, so that you may be at loss on that day. Do not get frustrated for this which will lead you take more wrong decisions. Stop for some time and get back to the market with fresh mood. Always be alert and try to avoid losses..
6. DON'T BE GREEDY: Particularly in stock market, there must be limit to satisfaction and you should not be greedy to earn more and more on a single day. If your number of trades already fixed and completed with good gains that's it for the day! Do not try to earn more by overtrading which will spoil your day again with the erosion of earlier profits. Never be greedy.
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