What are the biggest mistakes a trader should avoid in stock trading?

[oraclewizard77]

Like trading any other instrument, not having a plan is a mistake. A plan should tell you the following.

1) What time frame are you trading in. For example, daily, weekly, monthly.
2) What type of edge are you using. (Edge being defined as some way to achieve a profitable outcome based on statistical evidence.) An edge can be different for each person and one person saying their way is better than others is silly.
3) Trade management including if you are going to use stops or not, and how to handle profits.
4) Psychology in how do you handle the feelings of having a loss so that you don't become angry and revenge or over trade.

 

[Handle123]

Just download a random number generator online, run it and assume one pip up when you have the even number and one pip down for odd number. Another more fun way is go to casino and look at roulette, plot it as one pip up when it is dark, and one pip down when it is red.

Plot those data and compare with your favorite chart and see if there is any different ? You can use TA to predict the next move and try to make money out of it. The outcome is always the same.

Any method you are using to trade, you are predicting positive outcome unless of course you want to lose your funds.

 

[Handle123]

Don't trade unless you consider this a business with proper Trading Plan, which might take a few years to make. If you have never had a business before, might be good to learn about managing a business first.

No rush to lose money, takes far greater profitable trades to overcome losing trades.

Consider that stock market generally goes up 2/3rds of the time but learn signs of when to get out before you get in.

Don't exceed 2% rule cause "I feel it" emotion, often the 95% lose will have etched in gravestone.

Believing that prayer and hope will save you, often times it is your subconscious knows better than most men can honestly say to themselves they have wrong position. Don't have to let position be stopped out, can get out earlier when you know price showing for a reason trade entered wrong.

 

[murray t turtle]

Trading a big account when you don't know how to control risk.

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Good point.
[a]Trading more than 1 share when learning;
easier said than done.LOL Most people do value an expen$ive education, not that it's a case for leverage when learning .LOL
[z] Keep long term records, on paper; and paper charts are much better than electronic charts, to study.