Before you actually start to learn about day trading, you have to understand the truth about it. You need to shed whatever optimistic misconception you might have about day trading (riches and wealth) and know that more than 90% of day traders fail to make any money in the market.
Why Do Most Day Traders Fail?
Now, this is an age-old question. So many came and so many failed. The staggering percentage people who failed gave rise to the opinion that trading is mysterious, or perhaps even a massive scam that profits only the rich and powerful.
There are many reasons why day traders fail in this business.
The first is because of their lack of knowledge about the notion of “risk vs reward”. A day trader can enter a trade wanting to make $1 per share but if his potential risk is $2, it is not worth taking the trade. Many are so blinded by the reward that they fail to make a well-formed plan before jumping in. This in turn, leads to the second reason, which is the lack of self-discipline. The mathematics of trading is actually very straightforward and easy. It is a person’s emotion that usually screws up the game. Not knowing when to cut losses, being stubborn on a losing trade and revenge trading a stock they have just lost money on are just a few examples of ill-disciplined trading. These day traders ultimately fail and they are not who you want to be.
Nobody should come into this business thinking that they can flip a few thousand dollars into a few hundred thousand with a flick of a finger. In fact, nobody should have anything to do with this mentality at all. There are countless day traders out there who managed to implode their accounts and gone bust overnight by chasing the next hot stock. Being stubborn and letting their pursuit for immediate wealth cloud their judgments.
With that said, there are also shortcuts you can take so that you don’t have to learn things the hard way like most did. These shortcuts will remove that steep learning curve and gentle the slope so that when you encounter similar scenarios, you are well prepared for it. Hopefully by the end of the mini-course, you will have achieved this goal.