Top mentality blunders I have made as a beginner trader. A thread ๐งต
1. Not buying stocks at ATH or 52-week high.
~This stock has already moved so high, don't think it will move much further.
Eg. All post COVID leaders.
1. Not buying stocks at ATH or 52-week high.
~This stock has already moved so high, don't think it will move much further.
Eg. All post COVID leaders.
2. Buying a stock after it has fallen >30% off its peak.
~ Heavy discount sale. This super stock has just corrected and that too 30%. I can't believe my luck mate. Grab as many as you can and sit tight for a handsome 50% gain very soon.
~ Heavy discount sale. This super stock has just corrected and that too 30%. I can't believe my luck mate. Grab as many as you can and sit tight for a handsome 50% gain very soon.
3. Buying at the TOP.
~Peak FOMO. Have been tracking this stock from lower levels from which it has doubled. I don't want to miss any more of the huge rally upwards. Everyone on twitter also seems to be making a fortune in this. Enough is enough. Can't wait anymore.
Eg. Renuka
~Peak FOMO. Have been tracking this stock from lower levels from which it has doubled. I don't want to miss any more of the huge rally upwards. Everyone on twitter also seems to be making a fortune in this. Enough is enough. Can't wait anymore.
Eg. Renuka
4. Holding on to a trade gone wrong.
~just 5% down, will wait for it to come back.
Okay 15% down. Twitter folks say that this is very strong support.
30% down. I am anyways a long-term investor, fully believe in the fundamentals.
50% down.
Fuck this shit, i am out.
Eg. Renuka
~just 5% down, will wait for it to come back.
Okay 15% down. Twitter folks say that this is very strong support.
30% down. I am anyways a long-term investor, fully believe in the fundamentals.
50% down.
Fuck this shit, i am out.
Eg. Renuka
5. Using too many indicators.
JUST STOP
JUST STOP
6. Not using Stoploss.
This comes from not accepting the risk truly. We tend to think loss is not a loss while paper profit is profit. Stop.
This comes from not accepting the risk truly. We tend to think loss is not a loss while paper profit is profit. Stop.
7. Selling your winners early.
The fear of potential profit turning into a loss drives us to cash in on the winner for a paltry profit. Most beginners go through this. Should improve with time. Always let your winners run unless it has broken some Sell rule. (Have sell rules)
The fear of potential profit turning into a loss drives us to cash in on the winner for a paltry profit. Most beginners go through this. Should improve with time. Always let your winners run unless it has broken some Sell rule. (Have sell rules)
8. Averaging down on your losers.
This one is the worst. Just coz a 10% loss makes us comfortable, we buy more quantities to see the average cost come down. Remember, % comes down but the absolute risk is the same or has only increased.
Never average below your original price
This one is the worst. Just coz a 10% loss makes us comfortable, we buy more quantities to see the average cost come down. Remember, % comes down but the absolute risk is the same or has only increased.
Never average below your original price
9. Holding Too many stocks at once:
3rd month into the Bull run, I had 51 names. It drove me crazy. PF management was impossible. My PF was a basement kabadkhana.
Recognize that this is greed and FOMO. No more than 10 names for a swing/positional trader works best.
3rd month into the Bull run, I had 51 names. It drove me crazy. PF management was impossible. My PF was a basement kabadkhana.
Recognize that this is greed and FOMO. No more than 10 names for a swing/positional trader works best.
If you liked this thread, follow @SakatasHomma for more of such educational threads and tweets about Trading
I am a technical analyst, and I mentor beginners in the stock market.
Subscribe to my Blog sakatas.substack.com
Checkout my Youtube channel
@sakatashomma" target="_blank" rel="noopener" onclick="event.stopPropagation()">youtube.com
I am a technical analyst, and I mentor beginners in the stock market.
Subscribe to my Blog sakatas.substack.com
Checkout my Youtube channel
@sakatashomma" target="_blank" rel="noopener" onclick="event.stopPropagation()">youtube.com
Loading suggestions...