3 Secrets to Becoming A Successful Day Trader
The world of stocks and trades looks lucrative from the outside. After all, everyone is drawn in by the prospect of just sitting at an office chair and making thousands of dollars from the comfort of home or office or anywhere else. In fact with the convenience of Internet and Trading platforms, all it takes to become a successful day trader is a laptop and a fast internet connection.
Yet among the thousands of people who try their hand at day trading, only a few survive and are able to make huge profits. So what exactly is the secret recipe to success in the cut throat world of day trades? We divulge the top 3 secrets of day trading that are deceptively easy to follow yet bring in huge rewards!
1. Extensive and Exhaustive Research Techniques
While many people tend to treat trading as a form of gambling, trading in day stocks is more about statistics and economics than anything else. This is why as a new entrant into this extremely competitive market, the best bet is to grab hold of a mentor, someone who knows the ropes and then gradually become acquainted with the natures and trends of the market. While there are many resources available for free online, the personal guidance of an experienced mentor is worth its weight in gold as they tend to impart nuggets of practical knowledge that is indispensable while making a split second decision on whether to hold or sell.
2. Using the Correct Trading Platform
While doing due diligence and research are vital to preparing the mind for day trading, nothing beats the experience of going out there and trading on the live market. For someone starting out though, this may be a huge risk as the potential for them to mess up on a trade or derive the wrong analysis from a trend curve is relatively high. This can result in a huge loss of capital and is the singular fact that turns away most rookie day traders from becoming professionals in the field.
This is why trading platforms that provide simulations where new traders can test out their trading ideas and analysis on live markets is indispensable to the growth of a day trader. We personally prefer Tradestation as it offers a robust simulation for newer day traders as well as the chance to communicate with more experienced traders through an open chat room. Often riding on the coattails of someone who has spent multiple years trading stocks for a living is the best way for newbies to find their own groove.
3. Mastering Risk Management
Trading has some inherent risks involved as no matter how well predictions are made and market trends are studied, there are gonna be times when the market does exactly the opposite of what experts indicate. In times like these, it is important to cut your losses and hedge bets in such a way that the downturn of the market doesn’t pull you under.
As a newcomer in the trading scene, even a small downturn can have a devastating effect mentally and this leads to something commonly referred to as panic selling! This is where risk management comes in as every split second decision needs to be taken based on sound reasoning and not emotional outbursts.
Trading is a hard ruthless world and without the right guidance and the right tools at your side, it can be a daunting mountain to climb. But these 3 secrets should help make that arduous climb to the top a little bit easier. So what are you waiting for, go ahead and go tackle the day trading market head on! Afterall in the world of stocks and trading, knowledge is power and information is wealth!