Beginner Stock Market Investing
Beginner Stock Market Investing: The 5 Step Stock Market Trading Business Plan
The 2nd habit of successful Beginner stock market investing professionals is to:“Have a daily trading plan.”
Whether you are trading or stock market investing on a daily basis, weekly basics or monthly basis, you should
always have an online stock trade plan of attack.
This plan can also be referred to as a trading plan and will be used by the stock market investor or trader on a daily basis for online stock trading ideas.
Whether the decision is to buy a stock or short a stock,
every trader or stock market investor should always have a daily working adjustable trading plan.
Your daily trading plan has to answer these 3 vital questions.
One way to tune into the outcome you desire is by asking yourself these 3 questions;
How much size am I going to enter a trader with and what is the maximum position am I willing to hold during a trade?
Which stocks or sector am I focused on as a Beginner stock market investing professional, during my stock market research?
What time frame am I going to trade?
These questions can be answered as follows:
Share Size? For example, my trading plan requires me to enter a position with no more than a 100 share lot.
I personally hate begin wrong, I don’t like losing money, nor do I like feeling like I’m held hostage by a stock,
so throughout the years of stock market trading, I have adjusted my trading plan to only enter a stock with 100 shares and no more.
In this case if the
stock trade doesn’t work out, I know that I haven’t lost a lot of money and the next successful trade can cover my losses with minimal effort.
Before I implemented this strategy, I would always find
myself seriously negative on a trade and having to close out a position because I could not handle the fear of losing too much money.
After months of minimal success using the “all-in” strategy, I reduced my entries to a share size of 100 share lots and gained the
confidence and ability to hold for a wider stop.
This method helped me refine my trading strategy and ensured that I spent more time actually in a trade, than panic stricken on the sidelines.
If you have a trading plan that does not have a specific share size
and you find yourself being stopped out more often than not. Perhaps it’s time to reevaluate your share size and rewrite your trading plan.
1. What Sector? As a trader, your level of focus is empowering. A directed
focus on a particular sector, and through repetition, you are able to identify opportunities in your sector and become very successful.
You learn the rhythm of your stock or sector. Stocks in varying sectors may have entirely different personalities and without focus,
you may begin chasing trades that appear to be the right ones, because you simply haven’t become familiar with a stock or sector.
My decision as a Beginner stock market investing professional, to focus on only four stocks has resulted in some of the most profitable days as a trader. During this period I only traded LVS,
POT, PRU, SLB. In this instance, the stocks are in different sectors, but I was only focused on these four and learned each stock’s rhythm.
I became very personal with the stocks. It was like meeting a
girlfriend for a breakfast date each morning. This may sound a little bizarre, but yes, I became very accustomed to these four stocks.
So much so that I knew that SLB produced violent moves
on Wednesdays between 10am-11am because of the oil number being released during this time.
This is the power of sticking to
a particular sector, or a particular group of stocks. You become the stocks parent and know how to sense the stock’s every move.
Find a sector that you enjoy trading and stick to that sector.
Your sector or group of stocks might consist of the Dow Jones industry stocks, or it might consists of stocks in the Nasdaq 100, whichever you choose, make sure that you pick three to five stocks and trade only those stocks until
you know them so intimately. As you gain confidence, and want to test yourself, increase your basket of stocks by another one or two stocks.
1. What Time Frame? I decided to become a professional trader and this allows me to focus
on trading intraday charts. By 3:55pm I have no positions in the market; I have closed out all my trades for the day.
If you plan on holding some positions over night, be sure to include this in your trading plan.
A very expensive mistake that traders make, is entering a trade on intra day analysis, but as the trade heads in the opposite
direction, the trader leaves the trade open overnight, hoping that the trade will somehow reverse and become profitable.
If you have done this before, you know what it feels like to try and rationalize the reason you are not going to exit the trade and take a loss.
If your beginner stock market investing trading plan does not have a clear and concise
strategy of handling after hours trading, rather close the day with a loss and work your way out of your loses the next day.
If you are a Beginner stock market investing professional who does not have the luxury of trading everyday, yet still want to
participate in the market, we advise that you focus your stock market activities to swing trading or long term trading.
Once you have figured out whether you are going to swing
trade or trade long term, you then have to create a trading plan that will help you make decisions on a daily basis.
How
to Invest in Stocks : Daily Tips and Learning
The goal of this website is to bridge the gap between the learning and the stock trading experience.
To make that gap easier to bridge for all who participate in stock market for beginners,
we advise for all new traders to acquire the Basics of
Stock Market Investing....read more
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