How to start with day trading in 2021 – 10 things all beginner traders need to learn
- In day trading, the choice of broker is important – low fee brokerage is of extreme importance!
- Never trade so that you get big losses. A rule of thumb is to never risk more than 1-2% of your account on each trade.
Ex. If you have euro 10,000 in the account, never lose more than euro 100-200 per trade.
- Learn from your mistakes. Let the stock market be your mentor and school. If you make a mistake, write them down and learn from them. If you follow this advice, you will minimize your mistakes and your strategy can make money for you.
- Be careful when buying advice, teaching and trading signals on the internet. Most people who sell something on the internet in day trading sell something that does not work! Always ask for results on what they want to sell or teach about. Always ask this before you buy something. If they have nothing to show, you can in 99% of cases be sure that what they sell does not work.
- Always get up if you fall. daytrader never give up! This is perhaps the most important trait if you want to become a trader.
- It is important that you base your trading decisions on facts and not on your emotions or your ego. Follow your plan and strategy.
- Always decide when or how to sell before you take the trade. This means that you have already decided on a stop loss, profit target, trailing stop, etc. before you take the trade. Of course, these should be based on your trading system. A common mistake among beginners is not to have decided where to have their exits before taking their trade.
- Have a trading journal where you write down your trades and follow up on everything the trading journal does. Not only when you bought and sold but also things that you learned. This applies to both mistakes and things that you do well. Return to your journal when you have problems or need help. A trading journal is invaluable.
- Read the best day trading books that have ever been written. You can never read too much as a daytrader. Keep in mind that a single tip from a book can make a huge difference in your results on the bottom line in day trading. Ask someone you trust or who you know has succeeded in trading for book advice.
- The success you will have on the stock market is mainly dependent on how much work you will put in. The famous 10,000-hour rule can be said here. Do not forget that you compete on the stock exchange with large companies that have very competent staff and resources. What do you know that you do not think they know? Work harder than everyone else!