The devil is in the details.
Trading on the exchange is the same business as any other. Its construction consists not only of the ability to read graphics but also of many facts. Such as money management, the right choice of broker, accounting and much more.
Indeed, for years you can stably trade-in plus and not withdraw money.
You may have an excellent trading system, but one transaction with the wrong lot will completely destroy the account.
For example, let’s turn to business in the real sector.
Imagine opening a store. You have found a great seller at a great price.
It would seem: here is the path to wealth. But, at the end of the year, the store is at a loss or closed. How could this happen?
The reasons may be mass:
- negligent personnel who were rude to customers and stole;
- an accountant who incorrectly filed reports;
- non-compliance with sanitary or other standards led to the closure of the warehouse and everything was gone.
But there are many reasons to fail in the real sector!
Only the availability of good goods and entrepreneurial vein does not guarantee success.
Expectations in trading and its role.
We communicate with many traders, both beginners and experienced.
Why do people choose this business?
Most often, the goal is to manage your savings, build an additional business, and find a profitable interesting occupation for retirement age.
In this case, the expectations are realistic. There is time for training and for classes with a mentor. Traders respect the risks, etc. The chances of success are quite high.
Who should not try trading?
There are situations in life when you cannot trade on the exchange. If the financial situation is precarious, there are only problems around, if they need to be resolved urgently, the exchange will only aggravate the trouble. Do not make trading the only source of income. Sometimes traders say: I quit my job and now I will only live with trading without trading experience. That is, after a couple of months or six months, he needs to pay bills on income from exchange trading.
To trade successfully, one must be prepared to lose trading capital. No wonder in the literature it is called risky.
If the funds are recent or, God forbid, borrowed, then the chances of making money are low. Here you must calmly take risks, otherwise, you will not earn. No one gives guarantees. Although there is no guarantee in any business either.
The need for an urgent result is guaranteed leads to the following problems:
- Selective signal execution.
Result: entry is only at a loss, or the most profitable signals are skipped. There is aggression and depression.
- Violation of risk in the desire to make money quickly.
Result: big drawdown, fear of trading.
- Fear of trading leads to the fact that the trader decides to enter the transaction not at the beginning of the movement, but at the very end, in a reversal.
- Consumption of accumulation. It will take at least six months to learn a new profession. Access to the “production capacity” – not earlier than in a year. If there is no other job, then the account can be “eaten”.
Conclusion: Study trading on the exchange if you have a source of regular income. If not, find it. And then proceed to study the stock exchange business or any other related investment. Do not place excessive hopes on exchange trading (now I will quickly solve all my problems). This business is no easier than any other. It also requires enough time to study. By the way, by learning, I mean not round-the-clock hypnosis of charts, but an integrated approach to building a business.
How to build a business correctly, taking into account all its aspects.
We come to the main question: what to do?
If you are serious, you have the time and resources to build a business, then we have developed a document for you, thanks to which no aspect will pass your attention.
You can download it at the end of the article.
But, here I want to complement it.
The first and most important thing is the availability of a profitable trading system.
I think you’re working on it now. Maybe you study it with us, or you’ve taken it from books or it works with your own observations.
In the example of a store, at the beginning of the article, the importance of a good trading system is similar to finding a sought-after product at an attractive price.
Let’s analyze one more case in the retail business. We open a store and came to Turkey for goods.
The seller says: “I have all the best. You’ll bring the goods to your homeland and tear it off with your hands. There will be no end to buyers! ”
Few will make a decision based only on this information, right?
Everyone will study the market, analyze demand until they make their own conclusions about the value of the goods.
Trading is the same business. When you have a trading system (absolutely no matter where), check it out and make it yours. Only then will it be profitable.
Next week we will conduct a webinar at the School of Trading on how to professionally check the trading system. This is a separate big topic.
And when you have a good trading method, the time comes to create a healthy infrastructure for its implementation. The task is to remove maximum risks and develop opportunities. Same as in the example with the store: remove legal risks, personnel, etc.
Especially for you, dear traders, we have developed a detailed, but not cumbersome checklist, which relates to all aspects of building a business for trading on the exchange.