Incorporate the invaluable elements below into your strategy.
Money management – Before you start, sit down and decide how much you’re willing to risk. Bear in mind most successful traders won’t put more than 2% of their capital on the line per trade. You have to prepare yourself for some losses if you want to be around when the wins start rolling in.
Time management – Don’t expect to make a fortune if you only allocate an hour or two a day to trading. You need to constantly monitor the markets and be on the lookout for trade opportunities.
Start small – Whilst you’re finding your feet, stick to a maximum of three stocks during a single day. It’s better to get really good at a few than to be average and making no money on loads.
Education – Understanding market intricacies isn’t enough, you also need to stay informed. Make sure you stay up to date with market news and any events that will impact your asset, such as a shift in economic policy. You can find a wealth of online financial and business resources that will keep you in the know.
Consistency – It’s harder than it looks to keep emotions at bay when you’re five coffees in and you’ve been staring at the screen for hours. You need to let maths, logic and your strategy guide you, not nerves, fear, or greed.
Timing – The market will get volatile when it opens each day and while experienced day traders may be able to read the patterns and profit, you should bide your time. So hold back for the first 15 minutes, you’ve still got hours ahead.
Demo Account – A must-have tool for any beginner, but also the best place to backtest or experiment with new, or refined, strategies for advanced traders. Many demo accounts are unlimited, so not time restricted.