Quote from vk60546:
Hi All,
I need your advise on where I should start . I'm a total newbie when it comes to trading, have about 2K to play with (i.e. this is the amount of cash I can affort to loose).
I'd be willing to engage in shorting stocks, but I'd have to do practice it first until I can reasonably forsee the outcome.
Is there an account that I can setup and trade for practice using 'funny money'?
Lastly, is there a statistic on trading that shows how many people actually loose money trading?
Thanks to you all in advance for replies.
Here's my two cents.
STOP TRADING if you are doing. A total newbie entering into a market is similar to engaging in a war unarmed. You are only waiting for slaugther!
Actually you shouldn't treat trading as playing. Treat it as a business. You need to study hard before you run a business. You need to study hard before you become a doctor. the same thing holds true to trader.
You need to get "qualifications" before trading. Bypassng the need of "qualifications" earns you notihng but hard lessons.
Most people lose because they don't know how dangerous the market can be, for unpepared traders. However market can be very, if not extremely, safe if you are well-prepared!
2K seems to be a bit lacking in captial. You need to have sufficient before you can play well, or a few bad luck may injure you severely. You may have a hard time to stand up again, not to say confidence loss. 5K-10K may be a good start, but it somewhat depends on what market and instrument you trade.
It is said to be 90% of (new) traders are losing money. Only 10% manage to win. From what the figures say, it seems trading is not an easy game.
Learn as much as you can this year. Don't you think learning 1 year is crazy? It might not be. If you realise how valuable this advice is, you are a big step towards success.
Books are the best teachers in my humble opinions. I learn most from books. The second is practice and research - much knowledge are built based on my work (eg I read chart after chart to find out some interesting chart patterns which seemingly no book I read has mentioned).
As a newbie,
do NOT try to learn from forums, or chit-chat trading rooms. They are only suplementary in nature. You won't learn much there. Forums are full of different people, many of them being newbies or beginners. Thus you may not be any worse than them Then how could you expect you can learn much from them while they ned your help too.
Even if you met any advanced or champion traders, they would rarely teach you "the keys" to trading, so you won't learn anything superior from them either, if you met one.
(Oh! you are learning from my post, so it's a bit contradictory
By the way, you don't really need "secrets/golden keys" before you can earn consistently in the market. But you have to find it yourself in books)
As to experiences, if you daytrade, you need to be familiar with your trading software, your reaction and decision-making speed. You can learn through all of them through sim trading.
As to psychology, I know someone may pop up and scold me, but experience doesn't really help to make you disciplined. however it may be true in the sense that
most people only learn after they get burnt. Most people won't learn before the burn. If you were such a person, then get some hard lessons by trading real. Losing enough mony may help you realise the importance of discipline.
That's what I do to train my discipline - your mileage may differ.
Books: lots, lots of lessons can be learnt from books! You don't need to pay for each lesson. Market is not a good place to elarn discipline. Its tutorial fee is way too high.
Lessons include but not limited to, how horrible market crash may be, lessons by others (including some of the legendary traders) why some greatest/most successful traders still fail.
If you understand the behind reasons why discipline is important, you will know how stupid you are if you are not disciplined.
Money/Risk Management: Actually discipline, un-emotions, money/risk management are all your friends. If you can realise their importances, you won't wish to deviate from these friends. I hope you won't learn them all from trading real. It's a bit late, and you will suffer!
Sim trading: Trading is what? Trading is a
MEAN business. I treat trading "funny money" as "serious money". It may be hard to believe, but I feel worried even if I loss virtual money. You may not understand why. But this helps me much towards success. Try to mock as close as possible what you (will) do or did in real trading. Remember everything you did in sim trading.
After enough practice, simply act like a copy-cat: copy EVERYTHING in sim trading to real trading but no more.
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After all, they are all 2 cents. Someone, difference in opinions is normal. No need to be too angry.
The above are written in a bit hurry, sorry if I make mistakes in the post.
If you wish to learn more, feel free to PM me. Thank you.
