These are 3 tips everyone should know before starting out in the stock market.
The hardest part of anything sometimes is simply just getting started.
“Name one other job that will make you look forward to a Monday. I trade in the market not because it’s easy but because it’s challenging. That’s where the excitement comes from.” -Ricky Gutierrez
Tip #1
The first tip seems simple but so many people overlook it, EDUCATE YOURSELF before taking a trade. Lots of traders figure out how to download and fund a brokerage either through a mobile app like Robinhood very easily because in today's age it's very accessible. They put some money in their account and they think they are off to the races. However, that is a quick way to lose simply because you just are buying to buy and do not understand why you are buying, etc. it's a common thing to do simply because it's exciting and everyone is eager just to make money as fast as possible. What I have seen is that the most successful beginner traders take the time to educate themselves on not only how to trade but begin to learn the concepts and thought processes behind each trade.
Tip #2
To add to the first tip above the second tip is to PAPER TRADE. What is paper trading? Paper trading or simulation trading is essentially fake trading. Most brokerages provide this for you for free, it's just like real trading you still buy and sell positions in real-time but it's not with your real money. It's a great way to practice what you are learning, and it is a great indication of when you may be ready to fund your account and trade live with real money based on how consistent you are with paper trading. Highly recommended every beginner trader paper trades before they trade with their hard-earned money.
Tip #3
Trading is very exciting and fun, we see a lot of beginners get started begin to do very well make profitable trades, and then just dump as much money as they can into their brokerage account. The last tip of this blog post is to only TRADE WITH WHAT YOU CAN AFFORD TO LOSE. It is very easy to get too excited and get over your head, remember as a beginner you don't have a lot of experience under your belt yet so make sure you are taking smaller position sizes and learning to scale into positions and use good risk management skills with a smaller account balance will pay dividends for you in the future when you begin to trade with more.