I went totally broke because...

S

Sanaz3

Hello,

I started day-trading stocks 8 months ago with $7,000 and absolutely zero experience. I made some money by chance I call it and lost them a few days later..made, lost, made, lost...you know the end. I went down to $500 recently and eventually declared myself totally "bankrupt", suspended my trading platform, and I am currently taking some time off. Meanwhile, I have no other source of income and was forced to ask my father to bail me out.

Long story short, I learned alot from my mistakes and the most valuable lesson I learned the hard way of course was: Get out of a losing trade before it's too late.

I have come up with a set of trading rules for myself, which I didn't have before and am trying to apply them when I get back to trading again in the near future. Here are my "5 simple rules":

1- Do NOT rush, wait for a 100% certain opportunity to get in!

2- Do get out of a losing trade before it’s too late (max 2% loss)!

3- Do not switch between going short ↓↑ long frequently and confusedly!

4- Do not hold positions overnight in the hope of tomorrow!

5- Do not trade during pre-market & after hours!

From your personal experience, tell me please what you think of these and what I am missing or need to add as far as the rules are concerned. Thanks.
 
Quote from Sanaz3:

Hello,

I started day-trading stocks 8 months ago with $7,000 and absolutely zero experience. I made some money by chance I call it and lost them a few days later..made, lost, made, lost...you know the end. I went down to $500 recently and eventually declared myself totally "bankrupt", suspended my trading platform, and I am currently taking some time off. Meanwhile, I have no other source of income and was forced to ask my father to bail me out.

Long story short, I learned alot from my mistakes and the most valuable lesson I learned the hard way of course was: Get out of a losing trade before it's too late.

I have come up with a set of trading rules for myself, which I didn't have before and am trying to apply them when I get back to trading again in the near future. Here are my "5 simple rules":

1- Do NOT rush, wait for a 100% certain opportunity to get in!

2- Do get out of a losing trade before it’s too late (max 2% loss)!

3- Do not switch between going short ↓↑ long frequently and confusedly!

4- Do not hold positions overnight in the hope of tomorrow!

5- Do not trade during pre-market & after hours!

From your personal experience, tell me please what you think of these and what I am missing or need to add as far as the rules are concerned. Thanks.
More...

1 --> Certain opportunity is defined by a tried and tested tradeplan. When you get a plan you can religiously follow theres no such thing as entering too late or too early.

2--> good rule.. maybe 1% even to start out

3--> this should be rectified through additional study of TA and a tradeplan

4--> depends on the market (if AH trading), timeframe, leverage, etc.

5--> good idea.. different PA, harder to understand at first...
 
Quote from Sanaz3:


1- Do NOT rush, wait for a 100% certain opportunity to get in!
.....
More...


There is no 100% certainty in trading. Nor in life. If you wait for a "100% certainty", (and it wll only reveal itself after it has already happened) you will miss the trade.

Sometimes, a 70%+ certain is a good enough bet. Something that happens 7 to 8 times out of 10 is good enough. Manage your risks, keep your losses small, let the wins pay off for all your losses.
 
I think writing a set of rules is quite easy, but the point is : will you apply them consistently ?

I am currently working on that, I can tell that I need a lot of time before I go back (for big money) to the market.

Have fun
 
Honestly, you should find another source of income. If you're a newbie, and you want to make a living trading, you honestly have almost no chance.
 
Quote from Sanaz3:

Hello,

I started day-trading stocks 8 months ago with $7,000 and absolutely zero experience. I made some money by chance I call it and lost them a few days later..made, lost, made, lost...you know the end. I went down to $500 recently and eventually missing or need to add as far as the rules are concerned. Thanks.
More...

Quite frankly , you need a good kick in the arse by your father..period!!!

Read what you wrote and you will find the answer 'why'...

A fool is easily parted from their money...

NiN
 
Quote from Traveler:

You're undercapitalized. What percentage of your net worth is the 7k?
More...

7K was all I had saved up. i.e 7K was my 100% of net worth. In fact I shouldn't have put all that money into day-trading with zero experience. My account was margin and got 3X margin.
 
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