Whether it’d be cryptocurrency or forex trading, both are normally risky. And with just a little mistake, you could be losing most, if not all of your money.
To avoid trading mistakes and to not go miserable for losing all your assets, here are 5 tips for you!
Do not risk more than you can afford to lose
This is the most common mistake people do; risking more than what they can afford to lose. Before trading ask yourself what amount are you comfortable trade with and then set a limit for yourself.
Again, trading is very risky, so remember to only trade what you can afford to lose.
Create a plan and strategize
This is another common mistake people do. It’s like hopping on a train which you don’t know where to go. You have to have a clear plan and strategy on how you’re going to trade which means you have to do your homework and practice before doing actual trading.
Some people risk their assets by entering a specific trade they don’t even know how it operated and worst how to exit.
If you want to have real profit, have a clear plan and strategize.
Stay critical
Some people give in to fear of missing out and eagerness. These emotions strongly drive you which causes you to do certain actions that can cause you to flop big time in trading.
For instance, you heard a rumor from a friend or bad news on TV about trading, that would then drive you fear. Then that fear will then drive your behavior to prematurely close your trade because you are too afraid of the risk.
It’s the same thing as eagerness. When you are too eager to trade, you don’t want to miss out on anything. You could end up trading too soon or close your trade late.
Either way, it can only add up to the risks of trading. So, make sure that you stay critical and that you stay aware of these emotions.
Do not leave money on an exchange
If you are trading on any exchange, never leave your money on it because that means you don’t have control over it and you don’t want to suddenly receive news that your exchange gets hacked or goes out of business. (That sure is a nightmare, isn’t it?)
So, make sure you keep your money in your wallet or on your bank account so they are safe and you have full control over it.
Always seek to learn
As trading is risky and uncertain as it is, there will always be times when you don’t get what you wish or your plan didn’t go the way you expect it. Even so, you have to always seek to learn from all your trading experience whether failure or success because these learnings, over time, makes you the best trader you can be.
If you are a beginner in trading, remember to keep these tips in mind so you avoid the common mistakes people do when trading.