5 mistakes of Beginner Traders

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5 mistakes of Beginner Traders

5 mistakes of Beginner Traders

 

Before Trading, Avoid 5 Mistakes of Beginner Traders

Beginner trader mistakes often occur among millennials who are just getting into the investment world. This can be seen from the increasing number of novice stock investors who appear every year.

5 mistakes of Beginner Traders

 

Indeed, stock investment instruments were chosen because they are profitable and can produce high returns or returns. Although profitable, no one can guarantee that stock investment will always be successful.

 

In the world of trading, of course, requires a strong foundation to be successful. Many beginner traders make mistakes stemming from a reluctance to learn more about trading securities.

1. Don't Understand Fundamental Analysis

In the world of stocks, you should be able to do basic fundamental analysis when deciding to buy a stock. Unfortunately, there are still many investors who like to see the trend for a moment in doing stock analysis.

 

Beginner traders are usually tempted under the pretext of getting quick profits or profits in the market, which actually makes some investors ignore fundamental stock analysis. Even though the company's profits and losses can be a trigger for stock prices.

2. Not Diversifying Investments

Every investment instrument has its own risks. Just fixating on one stock is certainly very dangerous because it can increase the risk of losing value or plummeting when the stock is down.

 

Therefore, use stocks as a medium or tool that can lead you to certain financial goals and see the bad side and the good side. Diversification of investments in various investment instruments is important so that if one of your investments fails, there are still other investment instruments and your money is not completely depleted.

3. Make Short-Term Transactions

You must know that short-term transactions or commonly known as short selling are quite tempting. But this transaction has its own risks because it is quite time-consuming, energy-consuming, and has a high risk due to the super fast fluctuations of the capital market.

 

5 mistakes of Beginner Traders

Therefore, you should need to control yourself so that you can still make transactions at the right time. For you novice traders, patience is the main key

4. Fear of Losing

Too afraid to lose or too brave in investing in stocks are also equally dangerous. One of the wrong habits of traders is to like to withdraw small profits, but is afraid to lose by cutting losses on stocks that in fact continue to sink.

 

5 mistakes of Beginner Traders

Well, you also have to understand, if your stock price drops drastically, you have to sell it if you don't want to lose even more.

 

5. Easily Influenced and Panic

With the rapid flow of information, more and more public figures give opinions to buy certain stocks. Do not immediately panic to sell the shares you have because you could be trapped in a state of panic selling. Panic selling is an event that occurs because investors panic and are afraid of falling stock prices.

 

In the panic selling phenomenon, investors will immediately release their shares regardless of the price for fear that the price will fall further. This is done on an emotional basis without conducting technical or fundamental analysis. Do not sell stocks at low prices even though fundamentals are still good. (NDA)