Day trading is a fascinating world. People are profiting by millions in minutes and are booking insane profits through Day trading. Moreover, it’s moderately easy to enter the world of trading. All it takes is a few hundred dollars and a good internet connection. However, it is just as easy to lose money in day trading. With the wave of the pandemic, America is seeing a surge in the number of day traders. Everyone is looking to make a quick buck through it. But if people are not careful, they can end up losing a lot of hard-earned money.
Dr. Chris Cole is a seven-figure entrepreneur and has a decade of experience in capital markets, crypto, and forex. Chris has grown up with the market and can predict the situation that can tick it off. He books profits by millions in a day through Day Trading. Chris is also responsible for managing the wealth of some of the biggest celebrities and athletes in the country. Chris has accumulated all his learnings and created the BWO Academy, wherein he teaches the ways to create generational wealth.
Chris shares four Day Trading mistakes that he often sees new Day Traders making.
1. Stop Loss
A stop-loss actualizes the contract if the price of the stock hits an agreed number. Stop-loss prevents the contract holder from facing irrecoverable losses as it places a cap on the losses. A new Day Trader should always put a stop-loss on their contract to safeguard themselves from huge losses.
2. Not Having A Trading Plan
Before you start trading, you should have a trading plan. You should test out your trading plan using a demo account or a trade simulator and check its profitability. A trading plan involves the strategies you plan to use to enter and exit a trade. It is a fact sheet for you to make informed decisions.
3. Emotional Investing
With the rise of the internet, there is a surge in people talking about trading online. People are talking about getting rich by buying and selling particular crypto or stock. New Day Traders often suffer from FOMO(Fear of Missing Out). They tend to buy and sell stocks or crypto that are trending on the internet, which can lead to heavy losses. A trader should not be dependent on his emotions. His actions should be based on facts and not on what is trending on social media.
4. Fundamentals Don’t Matter
Fundamentals matter for someone who is investing for a long duration. However, for a Day Trader, they are irrelevant. A Day Trader’s job is to predict the market for the day and act accordingly. They have to act as per the happening of the day and not the future.
Chris Cole shares more such facts in his BWO Academy. The Academy has a dedicated masterclass about his learning and experience as a day trader. They have courses that teach concepts of equity, real estate, and wealth too. Find out more about the academy here.