10 keys to becoming a successful Trader.To understand this it is very important for us to have complete knowledge about the stock market first. Then we will know how beneficial it is to invest in the stock market to earn money in future and increase bank balance. But not all stocks give the same profit. Many times small investment brings more profit, larger investment also risks loss.
The intraday trader must be prepared to face unexpected situations and accept challenges.The intraday trading strategy used depends on the market conditions as well as the individual trading styles of the traders. Some traders are very active and do many trading during the day with great amount of money also catching the change of small value of the stock.While there are some who trade only on specific news programs or only trends they have researched well.Therefore, a strategy that works for a very active trader may not work for a less active one
10 RULES FR SUCCESS FULL TRADER
1. Treat Trading Like A Business
To Be Successful one must trade as a full or part-time occupation – not as a hobby or job. As a hobby where there is no real commitment to learning, business can be very expensive as a job. It can be frustrating because there is no regular paycheck. Business is a business, and expenses, losses, taxes, uncertainty.
Causes of stress and risk. As a businessman, you are essentially the owner of a small business and you must do research and strategies to maximize the potential potential of your business.
2. Always Use A Trading Plan
A Trading plan is a written set of rules that specifies the entry, exit and money management criteria of a trader. Allows merchants using the trading plan to do so although this is a time consuming endeavor.With today’s technology. it is easy to test a business idea before risking real money. Back testing applying historical data based on historical data,allows traders to determine if a business plan is viable and also reflects anticipation of the plan’s rationale. Once the plan is developed and back testing shows good results the plan can be used in real business.
The key here is to leave the plan. Taking trades outside the trading plan, even if they become winners is considered bad trading and destroys any expectations of the plan.
3. Invest In Highly Liquid Stock
Liquidity is that on which intraday trading is based when there will be no liquidity then no intraday trading will be possible.When choosing a stock for intraday trading, one must first choose liquid stocks that have a high trading volume which can be bought and sold in large quantities without affecting the prices of large quantities.
To earn substantial profits, the trading size must be good and liquid stocks provide the required volume and position size.If the stocks chosen have low liquidity they may need to be kept for a long time due to low trading volume.Therefore for intraday trading, the stocks chosen should be from mid-cap or small-cap stocks or large-cap stocks with high liquidity rather than penny stocks.
4. Protect Your Trading Capital
Saving money to put money in a trading account can take a long time and can take a lot of effort and it can be even more difficult around the next time. It is important to note that protecting your trading capital is not a synonym with any losing business. All traders have lost business; He is part of the business. Protection of capital does not take any unnecessary risk and is doing everything he can to preserve his trading business.
5. Do Not Over Trade
The next suggestion in Intraday Trading Tips. This is that an intraday trader should do a limited number of trading and should not overtrade.This is one of the most common mistakes made by inexperienced intraday traders. Many trading sessions can be very harmful, even experienced traders do not trade more than 2-3 trades a day.
This is because intraday trading requires 100% concentration, so the number of trades must be kept low to ensure that each trading is given due attention.
When the market is bad a disciplined intraday trade slows down and when the market does business within a limited range it does not even trade until the market stabilizes.Ensure that the range of movement of prices is high enough so that the profits exceed the potential risk.In addition the trading volume should be kept low. Until that time a trader is satisfied that he has learned a lot, limited trading should be done.
6. Dont Trade Based On Rumors And Media News
This is one of the most important Intraday Trading Tips. Intraday trading is a type of trading that is based on certain technical indicators.Like guessing or fundamentals are based on indicators and not at all based on rumors.Based on the same rumor, some analysts recommend buying securities and others recommend selling the same.
This puts a lot of confusion on what to do and what not to do.An intraday trader must rely on his own skills and analysis, his strategies, and his own tools and indicators of what to buy or sell.
There may be breaking news but the market’s reaction to the news may be unpredictable. Prices can go anywhere and it becomes impossible to identify trends.It is great to take such a trade with the idea of huge profits but a successful intraday trader should trade only if he is sure of the trend.
7. Keep Analyzing And Learning
Intraday traders who believe they have learned all this or who do not have the desire to learn and find it very difficult to remain in the intraday trading arena.Intraday trading is about analyzing the market analyzing each trade and each mistake and profit to help the trader learn more each time.Learning never stops. It is rightly said that more than gains losses provide an opportunity to learn
A successful intraday trader keeps a journal of his everyday trades and at the end of each day analyzes them to see what he did right what went right and what went wrong and what he could do to make a better trade.Good research should be done before starting trades for the day.
8. Take Risk According To Your Risk Taking Abilities
One of the most important Intraday Trading Tips is that the investor should not be careless.Beginners who make good money in a short period of time can adopt the notion that the day trade market is the best way to make quick money.
Sometimes the trader trades at a higher amount which can result in a huge loss to the investor.Therefore it is very important for an experienced and successful trader to be aware of the losses and only use the amount they can lose.
9. Can Limit Your Loss
The stop loss has been used a lot in recent times. This is also true because a stop loss is a pre-determined amount of risk that a trader is willing to bear with every trade. This limits the size of your damage. Even if your trade is in the leading position do not ignore the stop loss, otherwise you may have to suffer a lot of loss.
10. Position Size
What is the size of your investment, it is very important. This determines how much quantity of stock you can buy or sell. With how much capital you are comfortable in the market, how much risk you can take or can face ups and downs this makes your trade plan properly applied in the market. Once you invest in the market it is equally important to periodically assess your investment, review your position size and maintain the balance.