Yes, the acronym might sound too new and hip, but it has existed for long. One of the biggest reasons why stock traders make some silly and uncalled trades, which usually end up in losses, is because they Fear Missing Out money-making opportunities.
This is more prevalent today than ever when the mainstream media, through sensational headlines, misleadingly tell you how the world is making money and you are not. So, it’s natural that you ‘re in Fear of Missing Out. And in that mix, it’s quite common that you take some unnecessary decision.
But, of course, just because it’s “natural” and “common” doesn’t mean it is okay.
If you are to create a high-value portfolio, and grow yourself as a stock trader, you must know how to beat the instinct of FOMO.
Here are 3 tips:
1. Have a definite trading plan
When you wake up every day and wonder how to go about with your trades, there’s a high probability that you will make mistakes.
However, when you’re working along with a definite plan, you would know exactly what you should do next. Meaning, the short-term trends will have relatively less influence on you because you already have a plan with you and you’re more likely to stick with it.
So, foremost, if you don’t already have a stock trading plan, create one. If you don’t know how, enroll yourself in a good online technical analysis course.
2. Listen to the right source of news
There’s too much noise online. You will find too many opinionated articles, false news and exaggerating forecasts that do nothing but spread market FUD (Fear, Uncertainty, Doubt).
So, don’t be a casual surfer who consumes everything that comes on her/his feed.
Pay heed to the sources of the news you’re reading. Are they trustable? Do they have the right track-record? Who has authored that article? Do they have the right expertise and experience?
Factor all these questions.
Avoid being one of the headline readers who get their news from anywhere they can find.
3. Chase the right goals
If you’re chasing a million, you will act as an opportunist. On the other hand, if you’re chasing a thoughtful, well-outlined goal, you will act accordingly.
So, audit your goals. Are they realistic? Are they vague? Are they too greedy? Do they align with your trading plans?
When you know what you want (and need) to achieve, you are less likely to care about what others are doing and how much money they are making. You are less likely to focus too much on short-term opportunities just for the sake of increasing the profit.
Recommended Read: The Key To Setting Right Stock Trading Goals
If you’re trading with the right plan and mindset, it’s much easy to beat FOMO. Because you keep your focus entirely on yourself and not others. And once you learn to do that, it could go on to define you as a stock trader. This is one of the things online trading courses teach.