Many people don’t make it as day traders. After you take out fees, taxes, and other expenses, many traders are lucky to break even. In a lot of ways, the odds are against you. This is why it’s important to make the most of your trades and be as smart about the whole thing as possible. If you are shopping for a day trading computer then it is entirely possible that you are new to the business and trying to learn everything you can about it (beyond what your stock picks should be). That’s why I have put together a few tips for new day traders to help them beat the spread and avoid some of the most common pit falls of trading.
If You Don’t Understand It, Don’t Trade It – It’s tempting to trade anything and everything that looks good, especially when you just start out. This may be options, ETF’s, penny stocks, or what have you. It’s generally better to just focus on a few, really learn about how they work, and get comfortable with them. From there you can try your hand with other things.
Have A Pre-Determined Exit Strategy – Setting a target goal and pulling out once you reach that goal is a great way to maintain consistent, predictable gains. While there may be more money to be had, and you may kick yourself a bit when you sell a stock only to watch it continue to rise, you can will end up making money and keeping it. Despite what conventional wisdom may be when it comes to day trading, greed can get you in trouble.
Minimize Slippage With a Day Trading Computer – Having a strategy is great, but you need to be able to execute it as efficiently as possible. That means that you need a powerful PC that has been built with day trading in mind. Having one allows you to see the most up-to-date information, analyze it quickly, and makes trades accordingly. A well-built trading computer will also be less prone to break down, which means you’re less likely to be taken out of the game.
Learn to be OK With Setbacks – There are going to be days when you are going to lose money. There are going to be days when you are going to lose a lot of money. While this may detour you from wanting to keep on trading, it’s important to remember that just about any trade who has seen success has also had those low points as well. Treat every setback as a learning experience and change your trading strategy accordingly.
If you’re new to trading and need some tips on how to shop for a day trading computer, then you’ll want to check out my complimentary Buyer’s Guide.