Will trading lead you to the fortune you have always dreamed of, or will it result in your financial ruin? “Unfortunately, it is very often the latter,” says Danny Rebello, Co-Founder of TruTrade.IO, whose automation software allows retail traders to trade on the level of experts.
“If it is done well, it can strengthen your finances over the long-term, but a high percentage of retail traders, or those who are not professionals, lose the money they invested and are no better off in the end.”
Rebello says that while effective trading will always be subject to inevitable risk, there are still ways to avoid making the mistakes that ensnare so many traders and cause them to lose out on high returns.
Mistake #1: Letting Emotion Influence Your Trading Decisions
Money, Rebello says, elicits strong emotions in many people. “When I first talk with TruTrade.IO clients, I ask them to tell me what money means to them. Very often, I will hear something like ‘security’ or ‘freedom.’ I can tell immediately that they are going to have problems unless they change their mindsets about money.”
The reason, he says, is that when you are emotional about money and attach so much importance to it, you will find it difficult to make wise trading decisions. “You may find yourself unable to sell at a loss, for example, which could be the best possible outcome. Instead, you’ll hold on to your investment for longer than you should, and you’ll lose more than you should have.”
The answer, Danny believes, is to desensitize yourself to money. “Try trading some small shares in the beginning and learning to let go of the emotion. Think about your long-term goals, not what’s happening each day. Then, as you gain control over your thoughts and feelings, you can gradually start trading larger numbers of shares.”
Mistake #2: Cutting Off Winning Trades Far Too Soon
More than one retail trader has exited a trade to preserve a win or minimize a loss, only to see later on that if they had stayed in, their return would have been bigger. “This is a very common issue,” agrees Rebello.
“One way to avoid exiting too soon is to adopt the mentality that you will let the market take you out. The trader who succeeds the most often is the one who will let the market make the first move. Watch closely what happens. If you pay attention, you will see the market reveal clues about what is coming. It’s kind of similar to when you play cards with someone. Most people have ‘tells’ that reveal what they’re going to do. The market is the same way.”
At the same time, Rebello recommends that you go into trading with a plan. “You must watch what is happening within the market and compare that to your plan. This becomes a lot easier to do, of course, if you have automation software like TruTrade.IO, which can help you to eliminate the guesswork and understand what you’re seeing. Above all, always stick to your plan and resist the urge to exit until what you’re seeing in the market and what your plan tells you to do line up.”
Mistake #3: Staring Endlessly at Monitors, Causing Fatigue and Mistakes
Trading effectively is all about the details, and it can be very easy to get a bit obsessed with watching for them. “I once knew a guy who had three computer monitors on his desk, and he spent hours in front of them, watching what was happening in markets around the world,” Rebollo remembers.
“As you would expect, it wasn’t long before he was making mistakes, and really, it was no way to live. Trading is supposed to be fun, not a headache. You simply have to take a break from watching the market and get out to get some exercise or have social time with friends. You must create time for your mind to recharge so that you can concentrate more when you return to studying the market.”
Rebello also suggests investing in good trading software that can do everything for you. “TruTrade.IO, for example, implements all the strategies and techniques used by bankers and trading professionals. When you’ve got that kind of power in front of you, you’ll find it easier to trust what you’re seeing, and you’ll have fewer reasons to stare anxiously at screens.”
The Takeaway for Retail Traders
Effective trading is about having a plan before you even step into the market. “Know what your risk tolerance is,” Rebello states. “Arm yourself with the latest information and know exactly when you will exit the market and why. Consider investing in software like TruTrade.IO so that you can make wiser trading decisions. Above all, never invest more than you can afford to lose, and have fun. You’re in for the ride of a lifetime!”
To learn more about TruTrade.IO’s retail trading technology, please visit https://www.trutrade.io/.
Direct Phone Number: 480.248.3554
7014 East Camelback Road
Scottsdale, AZ 85251