Yea..I know, you’re anxious to get started. You’ve got money to burn and its burning a hole in your pocket. You see great action going on and a lot of people are making money. Right? Ah…well…what you don’t see are all of those people not making money, because, in a Market environment in order for someone to make money some had to give it up ether as an investment or a write-off.
Write-off?? What’s a write-off? Well..its where someone sells their stock for a loss and writes it off their books. Then, at tax time they’ll record it as a loss. Oops…btw, you had better read up on the IRS rules for claiming a loss on a trade plus the “Wash Sale Rule”.
OK…slow down and take it easy. You’re not ready to try any real trades yet. You’ve got to practice first. btw, did you try the Trading simulations mentioned earlier? No…NO…why not? Oh yea..I see, it took a month to get the results and you thought you’d just skip to here and get started early.
Hmmm…real smart….NOT!!! Listen and listen carefully. You will never make any money trading stocks by taking short cuts. Some rare few individuals have but that’s just like those pyramid schemes where the earliest people are the only ones to make any real money.
You’ve got to practice first. Draw yourself a chart like the one shown below. Make a new chart each day. The drill should take you at least several months to complete. That’s right…several months. I’m not kidding. Otherwise, you are going to be paying a high tuition for this course; right out of your pocket and into the bank account of some other trader in the market plus your commissions to your broker. Hm…not what I would call a smart move.
Each day, pick one or two stocks that you’ve been following in the chat rooms or one that you’ve researched yourself.
Use the trading rules that you’ve learned from your studies and record your practice trades throughout the day.
When you can make 8 out of 10 practice trades at a profit, every day for 2 weeks, then, you’re ready for your first real trade. Remember, your practice trades must be recorded truthfully. Take into account the market timing. If people in the chat rooms are saying that its taking several minutes or even several hours to get executions and confirmations back from their broker, use those times for yourself. Otherwise, the only person you’re kidding is yourself.
Next…the post mortem of your trades. If a trade was profitable, write a short note why. If the trade was a loss, again write a short note why it wasn’t. Each day, review what you did right and what you did wrong. Tomorrow, adjust your trading strategy to fix the wrongs.
Next…practice, practice, practice. Keep going. Don’t stop. You’ve still got another month to go. Yep…remember: “make 8 out of 10 practice trades at a profit, every day for 2 weeks.