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Being afraid

People are afraid of things they don’t understand. It’s a shame, because trading shares is a lot less complex than most people think. Investing and trading in the stock market has some risk, as do all asset classes that offer good long term returns, however, risks can be minimised and returns can be magnified with the right strategy. Anyone can buy and sell shares, it’s how we choose these shares and then how we manage our position that dictates how successful we will be.

Skate.
 
Why should I keep reading?

It may save you many years of self-education if you have a slight interest in trading. I want to point out the dangers and pitfalls associated with trading and to inform you about the emotional roller coaster you will soon start experiencing once you start trading.

Gems are still penciled in for tomorrow...

Skate
 
Why start trading
It should not matter how much money you have or how old you are. It also doesn’t matter how much you know about trading, or whether you’re worried about what the markets are going to do, or whether you’ve never even heard of the “share market.”

Your freedom is at Stake
Trading isn’t about getting rich, but more about one day having the financial independence of being able to support yourself without an income. Your financial freedom is at stake here, and there is no better time to start creating it than right now.

Skate.
 
It Doesn’t Matter If You Mess Up

Many people never start trading because they’re worried about losing their money. It feels like you have to spend a lot of time and energy to get it right and if you don’t, then you might lose all of your money.

Getting started
So don’t let fear or self-doubt keep you from getting started. The very act of getting started is much more important than getting it right.

Skate.
 
Practice Makes Perfect

With that said, it is critical to make smart trading decisions. You can learn as you go by trading small positions and if you make a mistake small loses are bearable. Making small mistakes now will giving you the skills and experience you need to make the right decisions later on.

Skate.
 
Starting to trade can be easy

Trading doesn’t have to be super complicated or time consuming. Also, you don’t have to be rich either. There are plenty of easy ways to get started without having a ton of money and without being the world’s foremost trading expert.

Skate.
 
All Your Emotions Belong to You

Trading psychology is something most people don’t think about when dealing with their investments. However when trading for yourself, your emotions will have an unavoidable impact on your outcome.

Chart reading
Every price in the market is the sum of all our hopes, fear, pride and greed. There are some great (and I mean great) chart readers on ASF. When they talk don't contest their ideas.

Be smarter than the average bear & just say 3 little words..

Tell me more..

Skate.
 
Trading - the typical beginner

The typical beginner will usually be worried more about when to enter a trade than anything else. They think little of risk management, or even bother to plan when to sell. Because of this, when a trade begins to turn against them, they hold with the hope of coming back to even or their former profit level. Worse off, they may average down, in effect doubling down on a loser.

Skate.
 
Now I'm torn..

I want to keep my dumps to elements that concern trading. In particular the psychology, the business, the mathematics, and numerous other disciplines and sciences behind it.

I want to keep it simple.

Skate.
 
Investment decisions are normally based on your age.

Humans have been on earth for around 100,000 years and of all the humans who have ever lived to age 65, half are alive today. Average global life expectancy has doubled in the past 100 years, and Australia is one of the longest living nations.

Once you retire at 65 all the current advice is to invest conservatively but if you’re planning on living for another 30 years investing conservatively may not be the best advice.

Skate.
 
Official statistics underestimate longevity

Many of us think we’ll live as long as our grandparents or parents did, which is a major perception problem. We don’t realise how long we’re going to live and we consistently underestimate our remaining years.

This is the very reason why trading conservatively may not be the smartest move.

Skate.
 
Overestimating

New traders usually start out overestimating their ability because they have had success at work, at sport or generally been good at something and most new traders believe they should be successful at trading with minimal effort. People study for years to become doctors, lawyers, nurses, and teachers, yet for some strange reason new traders believe they can do a weekend trading course, read a book or two and be a successful trader in a very short period of time.

Skate.
 
Experience

Therefore the hardest part of trading is learning from experience or time in the market, its learning how to control your emotions and how to keep persisting even when your account suffers a few losses. It’s about being realistic and having an understanding that we are probably only an average trader at best but that’s OK.

Skate.
 
A tip for new traders

Forget about the money and focus on the process of successful trading. The more you obsess about the money the more likely it will derail you as success is not our overnight objective, success is the equivalent of drips in a bucket, slow steady and methodical trading will win the race.

Skate.
 
The Holy Grail of investing

Most investors spend a tremendous amount of time and energy seeking “the answer.”

They are convinced that there is one simple and easy approach to the stock market that guarantees riches if they can just find it, understand it, and apply it. The truth is that there is no Holy Grail

Skate.
 
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