morning guys
what a fantastic morning, walked the dog and got my favorite coffee and feeling great so thought I would share some insights on how I got into day trading, sharing some tips on how to become successful and breaking a few myths along the way
some of you are probably pro traders and some of which have only just started and thinking to yourself "wouldn't it be great to trade from any where in the world and not having to work a single day in my life"
we'll you can! if your and single...
Finding the inner passion for trading
You either have a passion for this or you don't. The earlier you realise your passion the earlier you need to let it grow into a successful "business". I opened a trading account the day I turned 18, I had a passion to make money and I saw it as a way to "get rich quick". It takes years of losses to figure out that its not a "get rich scheme".
Years of losses
If you think you can learn from reading a book or following what people buy on here you may get lucky once, twice or three times but eventually your trading account with crumble into pieces. Practice and experience. There's no easy way to trading, you need to practice to gain experience like anything in this world. You need to endure losses to realise what you are doing wrong. I have blown my account three times in my junior years before I kept asking myself "why?" figuring out "why". So the next time you have a losing trade ask yourself that question. Explore a bit further, find out why it became a losing trade?
Consistent returns
The way to make consistent returns is to do what you know. The years of practice you put in, will pay off eventually and you will know what works and what doesn't. What works for me probably doesn't work for you. Find your own strategy, fine-tune it so its working in your favor. One way to make consistent returns is to think of it as a business. Think about what's working for your business, have more than one plan. Have multiple plans and strategies, trade when the markets are great, ease off when markets turn nasty.
Less is more, cut your losses
Learning to cut your losses is very important. There are many trades you can do in a day. If a trade is not working for you, cut your losses and move onto the next. Don't fall in love with a falling stock. Less is more don't over analyze something, all I use is a basic chart, volume, and price. I don't bother looking at fibonachery levels, moving averages, VIX and all that stuff, I don't need it.
Once you get successful
Once you treat trading as your "business". That's when you can consider yourself as a successful trader. Talk to your broker ask him for discounts for trading the volumes you do. I contact my broker (big four bank) and my RM is able to waive up to 3months for me each year in brokerage fees. That's a saving in the thousands, back into my pocket.
Start while your young
Trading while your young and single is my best tip for you. I'm married now, and that's why I'm still in my nine to five job and trading as a hobby. I always say to my wife, I could trade anywhere in the world now, if I weren't married I could be overseas, trading a few hours a day and enjoying life. Reality is, I cant do that now as I have other responsibilities. If I were young and passionate to live that lifestyle, I would stay single and do it while I'm young.
Having a back up income
I guess, one thing that is important is having secondary income to back you up. Trading like a business, sometimes you make more money (in a bull market) and sometimes its a big quieter. Having secondary income puts less pressure on having to "make money" each day. You only need to trade when the markets are great, and not having to trade in quieter months like April and may.
Look for the trade of the day
Professional traders look for volume. Each day there are only a handful of high volume spec stocks to trade. Find the stock that does great volume early in the morning. Look for the professional "money". Get in early and wait it out till the end of the day. Professionals will get in early and offload it towards the end of the day. The middle of the day, is just "smart" or you can call "dumb" traders trying to trade it a few times a day and end up paying more than what they bought it for "losing your profits". "Smart money" generally comes in the first hour of the day and leave in the final hour but sometimes could go for a few more days - that would then be your own judgment whether to hold overnight or not.
I could write a book on trading so I'll leave it there for this morning.
Good luck with your trading
traderRR
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