3 Tried and True Methods of Losing Money Trading StocksYes, the title is something of a joke. An investor like yourself surely doesn’t want to lose money at stock trading. What follows are three common behaviors that, time and time again, blow up in the faces of investors, at many different experience levels. Even if you’ve been investing for a while with some success, it’s important to remember the things that DON’T work. We have to remind ourselves about the foolishness of these behaviors because they’re easy to slip into without even realizing it. Keep these in mind, and you’ll be much more likely to receive better dividends in 2016.

  • Listen to the Media. Investment media is a wild waste of time for anyone who wants to make money. You’d be well-served to avoid it at all costs. The typical stock trading media personality is one of two types: 1) The self-important, dignified, know-it-all who seems like she’s so much smarter than you. 2) The clown, screaming and gesticulating like he’s performing an exorcism. These two types are both sides of the same coin, entertainers who usually know as much or less than you. Do your own research. One great way is to use a stock trading research tool to understand the inner workings of a stock you’re interested in. The above link will lead you to many internal resources, like Highest stock price records for every stock of note, market cap data, and countless others. It’s hard to gain real insight about stocks, but it is attainable. Just do your own research. Ignore the media whenever possible.
  • Make Frequent Trades. Trading for stocks costs money, over and above the price of the stock itself. Many traders get hyped up on the excitement of trading, and make many more trades than they should, cutting into their dividends each time. Each trade you make should be on the basis of careful planning. If you’re making frequent trades, it’s unlikely that you’re doing more than stabbing in the dark. Not only will this cost you a lot in brokerage costs, you’re more than likely to lose lots of capital to investments that go south.
  • Try to Time the Market. I hate to tell you: no one can predict the future. And even if someone could, you and I most certainly can’t. When the market reaches thrilling heights and makes terrifying falls, don’t assume that you can predict where the ceiling or floor is. Many investors sell during bull markets, only to see the market go far higher. Others try to buy stocks “at a discount” during a bear market, only to see the market far even further, costing them their investments. Make calm, calculated decisions that aren’t a gut-reaction to the market’s turmoil.

There are plenty of other frequent investment behaviors that are disastrous, but these are three of the biggest offenders. Stay well clear of these, and you will have more success that you will if you do these things.

This was a guest post by Andrew Black, a finance writer from Baltimore, Maryland, where he lives with his wife, cat, and giant schnauzer.

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We often read articles and blogs which discuss the merits of the correct trading strategies and the benefits of the Forex markets as a whole. However, not enough attention is given to the type of trading platform used and why this aspect is so pivotal. To make this crystal clear, let us examine the top five reasons why choosing the correct framework is essential for your future success within such a malleable industry.

Connectivity

Currency prices and relationships can change within a split second. Of what use is a platform if it is unable to keep abreast of these fluctuations? The best systems will offer instantaneous updates and data as soon as either becomes available. Traders will therefore be able to make informed decisions to maximise their chances of walking away a winner.

Centralisation

Worthwhile platforms will provide all data through a centralised viewing system. This leads to greater efficiency and is much more desirable than a system which requires multiple pages to be open in order to view the “big picture”. Centralised trading software equates to concise and user-friendly software. Charts, account balances, open trades and previous executions should all be visible within a single screen. There is simply no substitute for such a streamlined appearance.

Confidence

The right trading platform will provide the user with confidence. He or she is much more likely to progress within this industry and as many systems also offer news, tutorials and commentaries, this confidence is further enhanced through an increased knowledge base. Any trader who lacks confidence may hesitate at the last minute. This could result in a missed opportunity (at best) or a substantial amount of money lost (in a worst-case scenario). Having faith in one’s abilities by choosing the platforms which CMC Markets offers is an excellent way to enjoy success now and into the future.

Clarity

There is nothing worse than not knowing the status of an individual trade due to unexpected downtime, connectivity issues or a problem with the software itself. Without a clear understanding of the state of the currency markets, a successful trade will never take place. CMC Markets provides a host of technical indicators, charts, news feeds and currency pairs. All of these are updated as necessary. The user can therefore enjoy the certainty that he or she is always in the best position to take the appropriate actions.

Compliance

The fifth component of a trustworthy platform is one which is compliant with all relevant rules, governing bodies and regulations. This is important for the security of the client. All data will be stored safely and away from the prying eyes of others. Also, these systems boast a vastly superior level of transparency. Not only is a non-compliant platform a security risk, but the trades themselves could prove to be illegal at a later date.

These five concepts should all be present within any platform. There is no excuse to settle for anything less than then best in these modern times.

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Some wizened fellow once said, “Give a man a fish and he’ll eat for a day. But teach a man to fish and he’ll eat for a lifetime.” And while it’s advice that might set vegans and vegetarians on edge, you get the point. Sound advice is one of the most valuable assets you can […]

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