Stock trading is a funny practice. Every trader is usually a tweak away from making or losing a lot of money, but these tweaks are generally hard to find or ignored by many traders. Below are a couple reasons for why you ARE NOT making money in the stock market right now.
1. You don’t know what you are buying.
Too many times traders buy a stock because it was recommended by somebody they trust. The problem is that the trader has no idea what the company does or why it is really even worth buying.
The lack of knowledge upfront often leads to uncertainty and no solid game plan. Use recommendations as a guide note a must.
2. You have no exit plan.
Just because you found a good stock to buy does not mean you have done all your due diligence. Before ever buying any stock, a trader should always have an exit plan in place, which includes possible selling points on both the up and downside of the buying price.
3. You can’t make a decision and stick with it.
I like to think of this as the “car changing lanes” theory. How many times have you seen a car weave in and out of traffic only to have it end up a couple cars behind you? It is very hard to spot the exact bottom and top of a trading range, so when making a trade stay confident in your game plan.