Trading the financial instrument is very much popular among the new generations. Most of us consider trading as an easy task and for this very reason, we don’t give ourselves enough time to educate. As a result, when we place trades in the real market you lose a huge amount of money. If you do some online research then you will find a shocking truth about this industry. Though the active participant in the forex trading community is extremely high only 5 percent of the traders are making a consistent profit. Many novice traders in the United Kingdom often ask how to master the art of trading. To be honest the best answer is, you need to educate yourself and trade with an extreme level of discipline. The market so volatile that even a single mistake can blow your entire trading account.SO being a currency trader you can never afford to trade without following proper money management. Let’s discuss the top three common mistakes that every novice traders make.
Execution of poor quality traders: This is very much common among the new traders. Most of them think that the money is out there and all they need to do is to place the trade. But in reality, things are not at simple. If you execute poor quality trades then it’s true that you will have lots of trading signals but in order to safeguard your trading capital, you need to focus on quality trade execution. When you focus on quality trade setup then it’s true that you will less trading signals. But quality trade is always preferred by the professional traders at Saxo rather than quantity. And in order to find the quality trade setups you will also need to a strong knowledge in this industry or else you will struggle pretty hard and losing hard earned money consistently.
Risking too much: There is saying among the professional trader's community that money management is the only Holy Grail for the traders. Indeed it’s true because without following this you will never be able to survive in this industry. The new traders often take advantage of their high leverage account and risk a huge portion of their trading capital in a single trade.SO when the trades go wrong they find it extremely difficult to recover their loss. As a new trader, you should be using demo trading account to develop your own trading system. The market might give you golden trade setups but always make sure that you are not risking more than 3 percent in any single trade regardless of the quality of trade setups.
Trading with emotion: emotion can be extremely dangerous for the trader’s career. The novice traders always trade the market with emotions after facing few consecutive loss. But as a currency trader, you will always have some losing orders and you need to consider them as your trading cost. Always make sure that you embrace your losing orders just like the winners. No one if the world can develop a 100 winning trading system and for this very reason the expert uses their rational logic to place their trades with proper risk management plan. As a trader, you should always aim for high-risk reward ratio trades since it will make your profitable traders at the end of the month even after losing more trades. It’s true that being a new trader it will be extremely difficult for you to control your emotions but there is no other alternative. If you think that you are losing your hard grip over your emotions than take the day off and start trading from tomorrow with a fresh mind.
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