As a trader, you might have heard about the statistical data that shows, 95% of traders fail in the stock market.
But, Why 95% of traders lose money in the stock market? – Here is the answer behind this question.
Whenever we start trading, most of the traders focus only on developing skills that helps them to make money from trading, and waste their time and money behind finding new strategies.
The new traders use their energy for learning new things like, technical analysis or fundamental analysis or other skills that helps traders to make money in the stock market.
It is important to gain knowledge, but during this learning process we completely forget about the most important things that determines that will you get success in the stock market or not?
So, in this blog, we will discuss in detail about the most important factors that helps you to achieve success in Intraday Trading.
When we initiate the trade, there are 3 possible outcome of that trade. I.e. Profit or Loss or No profit, No Loss. In the stock market if you want to be successful, first you need to understand the 80/20 Rule. This Rule says that, 80% mind-set and 20% plays important role in trading.
When 80% of your mid-set helps you to achieve success in intraday trading, then you should know specific skills that help to develop trading mind-set. Let’s talk on these skills.
Rule No 1: Never Trust on Stock MarketRule No 2 Below In Hindi
Why 95% of Traders Lose Money?
- When you start trading, treat yourself as a student and businessmen as well.
- Don’t trade with job-mind-set. You need to understand that trading is a business, not a job.
- When you start trading with job-mind-set, this creates bias in our mind toward periodicity of income. That means we start expecting specific income in specific time period. It may create trouble in your trading journey.
- So, remove job mind-set, when you start your trading in stock market.
- You need to start trading with discipline and keep your emotions away from yourself.
- As, you are independent trader, there is no-boss it doesn’t means that you will do anything in the market. With the discipline, you need to regularly follow the market and keep updated with it.
- At the end of the day, review your trade, note down the reasons behind the trade. This exercise will help you to lean from your own trading experience.
- There are four expected out-come from trading – Big Profit, Small Profit and Small loss (That are Acceptable in your trading journey). But, Big-loss is not acceptable. So, always work with stop-loss.
- Big-loss will easily blow-off your trading capital, so you need to understand that to recover 20% loss; you need to earn 25% profit. In the stock market there is only and only one thing in your control, that is loss.
- When price moves against your trade, don’t wait for price to move in your favour. Always accept small loss, and immediately exit the trade.
- When new traders comes into market, they always think about profits in mind and with this mind-set when their trades covert into losing trade, they start trading to take revenge. And with this revenge in mind, they take trade against their setups and again loose the trade.
- As a new trader, you can decide risk per trade, that means prepare your mind for particular (you can take 1% risk of your total capital) amount of loss is acceptable per trade.
- Whenever you make profit, make habit of withdrawing your profit. – It will impact very positive on your trading skills.
Rule No 2: Investment Aesi Karo, Ke Bar Bar Na Karni Pade
So, here are some important tips that can help you to become a successful trader in your journey.