| Trading in the stock market is less than a zero sum | | | | shocking every rational bone in your body. It'll feel like |
| game. Many people say that stock trading is a zero | | | | absolute chaos, and you won't know what happened. |
| sum game, but the fact is, after commissions, it's less | | | | You'll be tempted to adjust your stop or your limit |
| than a zero sum game. And as many as 70% or | | | | even though you know you shouldn't. You'll find |
| more come out losers. | | | | every reason to prove you were right, just a little |
| So why are stocks dangerous to the unprepared? | | | | off. But the truth is, we can never know exactly |
| First of all, making mistakes. You may live your life | | | | what's moving the market in the moment. |
| with a commitment to doing your work well and | | | | The other side of it is when you didn't do things just |
| always apologizing if you make a mistake, but that's | | | | the way you were supposed to. The trigger wasn't |
| not going to work in the stock market. No careless | | | | exactly in place, but you felt good about it and |
| mistakes here. I've learned this the hard way. | | | | jumped in anyways. And there goes the stock in the |
| On one occasion, early in my trading, I bought a | | | | direction you hoped. So you're confidence soars, and |
| handful of shares of a stock that was showing | | | | you begin to doubt the need for the system. You |
| strong signs of moving up for a nice profit. The next | | | | start to gamble on instinct, thinking you have some |
| day, I opened my account to find out that I was | | | | special insight or sixth sense into the stock market. |
| right! But I had forgotten to put in my limit order, and | | | | But the market's just tricking you. Trade like that and |
| the stock had already been beyond what I expected | | | | it's only a matter of time before you're talking about |
| and dropped back down... and down. With my | | | | your great trading ability and profits in the past tense. |
| untamed emotions, I foolishly held on longer, hoping it | | | | It can be tempting when encountering chaos in the |
| would go back up, only to see it continue to drop. | | | | market to think that there aren't any real patterns. |
| In the end I realized a 20% reduction in my account. | | | | That's why we need to continually educate ourselves |
| instead of a serious profit had I not forgotten to put | | | | as traders and stick to a solid trading plan with |
| in a limit order. Talk about hands-on stock education. I | | | | realistic money management. |
| just made a bonified, bone headed mistake | | | | Those are only two of the reasons that so many |
| Secondly, you'll lose when you should have won, and | | | | people fail at stock trading. |
| you'll win when you should have lost. Trading can be | | | | The key, as in any new endeavor, is to get the right |
| a confusing game. You can do everything right and | | | | education and mentoring where available. Trading with |
| still lose. You can learn from a good technical analysis | | | | great training will only lead to profits. Trading without |
| course, watch the technicals, see the perfect trigger, | | | | reliable education is a guarantee of failure. You are |
| get into a great position and be prepared with stops | | | | the reason you will succeed or fail. Trusting the right |
| and limits. | | | | mentor and technical analysis course (see below) will |
| Sometimes the stock's price will do the unexpected, | | | | keep you from falling. |