- There are numerous trading myths.
- These myths are held by both the new traders as well as some people who know very little about trading.
- These trading myths are not only harmful to the aspiring traders but also to the entire trading community.
Trading is all about making fast money
- This is the biggest myth about trading, which is also commonly held by some of the amateur traders.
- Many people think that trading is a get-rich-quick scheme.
- With this expectation, many new traders will enter the market and trade with the wrong mindset, and as a result of this, they will fail miserably.
- Trading is a very long process, and it will take a very long time to develop.
- You will not become a billionaire overnight by trading.
- You will only be able to make money by trading if you w the right process and work on some of the important factors, such as risk management, trading psychology, trading plans, etc.
- If you will not follow the right process in trading, then you may end up blowing your entire capital very soon.
- Thus, capital management is the most important aspect of trading.
- The primary goal of every trader should be the preservation of his capital rather than growing it.
- If you in the market for a long time, the market will definitely give you the chance to grow your capital.
- Trading is nothing but the battle against all the traders in the market thatyou are looking at.
- You will not be able to win this battle without proper planning.
- Once you understand that capital preservation should be the primary goal and you have to only trade the opportunities that will satisfy the criteria of your trading system, then only you will be able to make money from the market.
You need a commerce background to trade in the market
- Many people think that those who have a commerce background can only make money through the market, but this is completely false.
- Anyone can trade in the market and become successful if they will trade with discipline irrespective of their background.
- Trading is not just for the commerce graduates, but it is for everyone.
- Even a trader who has a commerce background can fail in the stock market if he will not follow a proper trading system.
- On the other hand, a trader who does not have a commerce background will be able to grow his capital steadily if he follows his trading system with discipline.
- The important point is to trade in the market, and for this you will not need any college degree, sharp mind, or high IQ.
- Those who will become successful in trading will work on themselves.
- They will learn new things every day and will also try to improve their trading.
- So, if you can work on yourself every day, and if you are always eager to learn new things, you can also become a successful trader.
- so big that it will bring emotions and ego into the trade.
- It is always good to start trading with less capital rather than starting with a huge account because, at the beginning of your trading career, you will definitely make some mistakes and lose money.
- Thus, it is always good to start with less.
- When you become profitable for 1 or 2 months with a small amount, then you can slowly increase your account size.
- Another reason for starting with a small account is the skills, risk management techniques, and psychology that are required to become a successful trader.
- Hence, it is always good to start with a small amount and sharpen your skills.
You have to know the future of the market to make money
- Many people think that any successful trader or investor who will make consistent profits from the market knows everything about the future of the market.
- This is not true.
- No one knows the future of the market.
- In fact, in trading, you will not need to predict the future of the market, but instead you will have to work on the probabilities.
- There are always two outcomes for any particular trade.
- Either you will make a profit or you will make a loss.
- Trading is all about winning big or losing small.
- As a beginner, you should always try to develop a system with an edge because this will pay out in your favor.
- You will just need to master one strategy or one trading pattern to become a profitable trader.
You need a lot of capital to make money from the market
- Many new traders think that those who have more money can only make a profit from the market.
- But the truth is you will not need a lot of money to start.
- A good trader can generate excellent returns irrespective of the account size.
- Trading with large capital will cost more money for your mistakes.
- Always remember, it is always good to lower your trading account size to an amount that is enough to be meaningful.
The number of winning trades should be more than the losing ones
- This myth is a little bit complicated.
- Many traders often think that to become a profitable trader, the number of winning trades should be greater than the losing ones.
- But this is not true.
- The truth is you will have to win big but not often.
- You may have heard about the risk-to-reward ratio, and this will play an important role when it comes to the profitability of a trader.
Algo trading is the key to trading success
- Many new traders think that trading is some sort of a trick.
- But trading is a complicated task, and it can never be automated by some machine.
- It requires thinking and decision-making ability, which is not there in the robots or any other software.
- A fully automated trading system is going to fail over time because as the market cycle changes, you will have to slightly change your trading approach, which is what machines cannot do.
- Trading conditions will not change every day, and there are some days on which your system will fail.
- If you look at any successful trader, they will all use their minds and not robots to become successful.
- It is always better to work on your trading system rather than searching for this kind of shortcut.
Conclusion
Trading is not just a get-rich-quick scheme.
Frequently Asked Questions (FAQs)
Q1) Who is India’s No. 1 stock market trainer?
Arun Singh Tanwar is India’s No. 1 stock market trainer.
Q2) Who is the biggest stock market guru?
Warren Buffet is the biggest stock market guru.
Q3) Which trading is most profitable?
Momentum and swing trading is the most profitable form of trading.
Q4) Who is the godfather of the stock market?
Benjamin Graham is the godfather of the stock market.
Q5) Who is a successful day trader?
George Soros is a successful day trader.
About Us
Nifty Trading Academy is our academy where we teach you about the stock market as well as technical analysis. We also provide live trading sessions and upload blogs for the same.