Another year went by and nothing much changed for you on the financial end. You knew you should save more – but you didn’t. You knew you should have more sources of income – but you didn’t do enough to make it happen. You knew you should invest in the stock market – but you got reluctant.
Although just a change in date, New Year does bring with it a sense of new beginning and newer opportunities. So, in 2020, don’t let things passively slip by as it did in 2019. This year, take control of your finances. Take a step towards becoming a stock trader and building a sustainable portfolio.
Here are five essential tips that will help you become a (good) stock trader in 2020:
1. Get the basics correct
Of course, if you know nothing about stock trading, which is completely fine, you should first learn the basics before jumping into the scene.
So, spend a sufficient number of hours reading reliable articles and watching relevant videos. In fact, to get your first few steps in the right direction, it’s better to enroll yourself in share trading courses.
How the market functions, how to open your Demat account, what factors influence the market – make sure you know the answers to such questions.
2. Don’t wait for “perfect” opportunity
Once you know the basics, now don’t wait for the “perfect” opportunity – something that so many beginners do.
Yes, you must find a good entry point. It’s a part of the strategy. However, this doesn’t mean passively waiting for the opportunity; it means actively finding the opportunity.
So, don’t wait or you’ll end up waiting forever. Don’t over analyze. Don’t fall for perfection paralysis. Take a small step forward and then navigate your way to profit accordingly.
3. Pick your speed progressively
Don’t put too much money in your first few trades.
Just reading a few articles isn’t sufficient to successfully trade in the stock market. Experience and intuition play their own role here – both of which you lack.
So, you want to start slow and pick up the pace. Meaning, you must spend a small sum in the early weeks and once you have the hang of it, only then should you take bigger, calculated risks.
Understand that the journey to build a high-worth portfolio is long. It won’t happen in a few profitable trades.
4. Learn the advanced concepts
Once you’re trading, you would understand that just knowing the basics isn’t sufficient. Now to take yourself from being a beginner to someone who’s experienced, you must learn the advanced concepts as well. You must learn technical analysis.
So, spend a lot of time learning the RSI, reversals, time frame confluence, moving averages and other advanced concepts.
Again, you can do it either by reading articles and watching videos or enrolling yourself in share trading courses. We recommend you do both!
5. Be fine with losses
This is a bit holistic tip. No matter how good of a stock trader you are and how smart your strategies are, you will lose money; some of your losses might be big. Because the market is dynamic and unpredictable!
At such time, it’s essential that you get hold of your emotions and not trade immediately to quickly recover your losses. Trading emotionally exposes you to many vulnerabilities. You’re more likely to make even bigger mistakes here than to really recover your lost money.
So, learn to be fine with losses and trade rationally.
These are five tips on how to become a stock trader in 2020.
Of course, in 12 months you won’t become an expert at it. And unless you have good financial backing and a big appetite for risks, you won’t be able to build a big portfolio either.
However, the small steps in 2020 will lead you towards the financial freedom that you’ve long wished for. It will take some time. But it demands small steps.