Many newcomers enter the trading world in a rush to make their first million. Getting the big bag is often the goal! While few, indeed, get their big bag from trading, a lot of new traders miss it at their early stage, get frustrated, and start pioneering the idea that trading is nothing but a big scam.
In this interview, to take us through common mistakes new traders should avoid, is Lance Ippolito, a market expert with extensive insight on how to navigate the hurdles associated with trading.
As an expert who has been in the trading business for a while, do you think there is still enough room for new traders in the market?
Lance Ippolito: There is as much room for new traders as there is enough air in this world for everyone to breathe. But then, trading is not as simple as new traders believe it to be.
I mean, it is not the case that you just have to punch in a sell or buy tab, then wait for the money to roll in. If it were that simple, everyone would be a trader.
If there is still enough room, do you think new traders are likely to notice and leverage rare market opportunities?
Lance Ippolito: New traders rarely have a proper understanding of trading before they begin buying and selling in the markets. They tend to overlook the mentoring and education stage in the bid to get ahead of the curve. They start gambling instead of making premeditated and calculated trades. With this rush, they tend to miss out on the market’s real opportunities.
This is the technological age, where there is enough information available online. If only they could take their time to learn. Believe me; the mine is filled with gold.
What are the common mistakes new traders make that can be avoided?
Lance Ippolito: From the experience, I have garnered over the years, I have been able to note some common mistakes new traders tend to make. I will highlight and briefly touch on some of them:
- Having No Trading Strategy: As a trader, one of the first things you must ensure to have is a trading plan. Trading is not a guessing game. A trader without a trading plan is prepared to fail. Learn, take your time and build a plan.
- Patience: This is one character trait that is lacking in new traders, even in some old traders. If you jump into trading, be prepared to jump out. Patience is one thing you must learn as a trader. Wait for your plan to materialize and strike.
- Emotional Trading: You are running at a loss because of wrong trade or even a right trade gone wrong. Then, in the bid to recover the loss, you jump on another trade. That sounds familiar, right? You need to remove your emotions from the trade. Focus on strategy.
- Not Having a Stop Loss and Take Profits Plan: These are important tools when it comes to investing in stocks. This helps you know when to enter a trade and also leave.
Are there things they should rather focus on?
Lance Ippolito: I’ll recommend taking time to learn the workings of the market before starting to trade. I mean, you have the option through demos to test your trading plan before implementing it. Take your time to get educated. The market is not going anywhere.
Are your recommendations all that is needed to guarantee success for newcomers?
Lance Ippolito: My recommendations here do not capture everything you need to know before starting out trading. Notwithstanding, if you properly apply them, you are on your journey to becoming a profitable trader. You can check out my website for more recommendations.