In the stock market, everyone makes mistakes and results in losses. If we can learn from mistakes, then we can reduce the losses that will occur. Learning from mistakes, we can improve and practice to make a profit.
Everyone who experiences mistakes in stock trading is natural. Here the role of fbs malaysia can help us to reduce mistakes in stock trading to continue to evaluate and learn.
Some Mistakes Traders Make
The following are common mistakes you should avoid when trading stocks so you don’t lose big:
- Over Information
Every trader will want to know a lot of information about the capital market. But usually new traders can’t choose what information they need. So they receive a lot of irrelevant information.
As a result, they are confused about making decisions. To avoid this, you need to adapt the information you get with stock charts. Stock charts already reflect everything that happens in the capital market. So by reading charts, you can read the psychology of market participants.
- Does not have a stop loss
A trader who loses heavily, not just out of luck. But because they cannot limit and control their own losses. Every experienced trader can always limit losses with the stop loss method.
Before buying shares, they set a limit on the lowest share price that will be held. So that if the stock price falls, they can immediately get out of the market and be free from the risk of loss.
- Failure to Apply Stop Loss
The stop loss method is a form of planning. If you fail to implement the plan is in vain. Many beginners experience this error.
Even though they have determined the stop loss point, when the stocks go down they still hold their shares for various reasons. This indiscipline causes huge losses to novice traders.
- Averaging Down
Averaging down is a strategy to purchase shares in stages when the stock price is decreasing. Usually traders carry out this fbs malaysia strategy so that they can increase their shares and reduce their average purchase price.
Basically, averaging down can be effective if it is carried out by investors who have a long-term orientation and have large capital.
- 5. Lack of preparation and education
The lower the trading skill, the greater the potential loss. Learn before investing in capital markets.
Buy books that provide knowledge about stocks so you can sharpen your analysis. Don’t just join stock trading if you still don’t understand the risks and how.
- Transactions too often
Many newbies can’t wait to invest and trade too much. Even though this is a beginner’s mistake. This can slowly reduce your capital and eliminate the potential profits you could reap.
Those are 6 mistakes in stock trading that a beginner makes. It is better if the trading strategy is assisted by fbs malaysia so as to minimize losses. Avoid the mistakes above so you don’t lose a lot and give big profits. Continue to learn and improve stock analysis skills.