7 Small Tricks That Can Turn You From An Amateur Investor To A Pro

by Andrew McGuinness     Jul 16, 2019

No matter how many numbers or how much research goes into it, at the end of the day, Trading 101 is less of a science and more of an art. Like any art form, trading requires inherent talent and thousands of hours of practice. Honing the discipline and analysis skills required to trade at a professional level requires learning how to ignore greed and fear while trading.

There are also a few changes and additions to your routine that will help you perfect your trading craft. Whether you are an amateur or a professional, here are 7 small tricks that can improve your trading immediately.

1) Choose A Strategy And Stick With It

Trading is all about the long-term plan. Understand that losses and gains are both inevitable parts of your trading career, and the goal is to make sure that the gains outweigh the losses. Whether you opt to become a short term trader or a long term investor, it’s important to stick with a single strategy. This guarantees that you master a certain style, raising your chances for maximum gains.

2) Set Exact Entry And Exits

When handling your investments, it’s important that you synchronize the trading direction you follow from both a daily chart and a weekly chart. This means that you coordinate the buy signal of your weekly chart with your daily chart, so you don’t end up mistaking a buy time for a sell signal.

3) Learn To Embrace Your Small Losses

One realization you must come to terms with is that every dollar that is invested is money that is no longer yours. The money you have in your investment should not be money that you require for your necessities, such as food, rent, or supporting your family. It helps psychologically to convince yourself that all money in an investment is spare vacation money; this way, you can learn to embrace your small day-to-day losses rather than stressing out over every dollar in the red.

4) Analyze Weekly

At the end of every week as the markets close, it will help your trades of the next week to take the time to study the weekly charts. Find patterns and market behavior that can assist you in your decision-making over the next week. This teaches you a reflexivity that you can’t attain with any amount of trading or experience; analysis is the only way to hone this skill. Don’t always rely on pundits, who have sometimes been known to mislead the public to benefit their own assets.

5) Create A Positive Feedback Loop

When you make a successful trade—planning and executing it on your own—this is the start of a positive feedback loop. Continue expanding this success and turning it into confidence, allowing you to take your losses on the chin, knowing that a profit is just another trade or two away.

6) Pick The Right Broker

Don’t just choose any broker: make sure that the trading platform you use will give you the time and analysis that you need to develop your trading skills. Spend time learning the policies of each possible broker, and how they regularly engage with the market.

7) Print Your Records

As great as it can be to keep everything on your computer, nothing beats a printed record that you can hold in your hand. Printing out the charts of your recent trades, as well as the explanations that led to each trade (and whether you saw a gain or a loss), is key towards evolving as a trader and become a professional.

Analyze yourself as much as you analyze the market—were you too greedy, too ambitious? Try again next time with your new knowledge of your strengths and weaknesses.

Get unlimited access to our Learning Center,
Broker Insights and Exclusive Promotions for Free!