10 Ways to lose money in trading.

Every trader have ups and downs in his trading career. But the successful trader is the one who doesn't make the same mistake again and learn from his loosing trades. New traders need not lose too much money to learn if they take a leaf out of previous traders' advises. Here are some things which a trader can avoid from making. Which were made by previous traders including me.

1. Don't do intraday trading without much knowledge in it. Don't just jump on to intraday trading. It takes a lot of time to understand successful trading strategy no matter how much you know by reading books and doing courses. New investor or trader should have a medium to long term outlook to start with. To start with allocate only 15% of your capital for trading and invest remaining 85% in good quality stocks for medium to long term.

2.Going against the trend in the market is the best way to lose money.
Don't go against the trend in the market. Going against the trend might fetch you results in one or two occasions but 80% of the time traders lose going against the trend.

3. Trying to master the techniques which you don't know much about and try applying them without testing is another way to lose money.
Make your trades simple enough and don't use complex systems and methods which are not your cup of tea. Knowing some of the technical analysis and fundamental analysis tools is OK. But over relying on them and blindly following them may take your trading capital away from you.
You should know when to use what. Otherwise don't use them at all.
Remember !!!!!!! Half knowledge is more dangerous.

4. Watching the TV channels and following the recommendations and predictions given there is the most common way in which Indians lose their money in market.
Loosing traders watch CNBC TV18, NDTV profit ,nowadays UTVi most of the time, may be due to depression or because of anxiety to cover up their losses quickly. Watching these channels is of no harm , but watching them 24x7 is a cause of concern. You don't get much out of it except few shows in them where some experts give their comments(not recommendations).
Real experts never predict the future. They just go with the market and follow the trend to make money.

5. Never go by the targets and predictions given by different channels, ironically they will never match with each other. If they match, that target will never be reached. Market is mysterious and excites most people by giving surprises which no one could catch till now. Whenever you invest or trade, just look at risk reward ratio. And decide whether you want to go with it or not by your risk appetite. Never buy a stock just because others are buying it.

6. Getting emotions into trading makes losses for traders. Never buy something just because you are feeling good that day. Market has nothing to do with your emotions. If you want to win the market, then keep you emotions away while trading . Have a clear cut strategy and act in accordance with the strategy no matter what happens in your personal life. Sticking to the strategy will help you most of the times as compared to switching strategies. In case of some extraordinary situations in markets, if you feel volatility is high then keep yourself away from market and close existing trades in minimum possible losses. Taking a smaller loss is always better than loosing your trading capital fully. This is where stop losses help you. Keep stop losses while trading.
Don't watch Business channels especially on the days of market crashes. These channels aggravate the situation and talks as if that day is the end of markets.

7. Trying to be junjhanwala or Warren buffet or a great trader is another way to lose money.
Every trader is different and have his own individuality. Having targets to reach the heights which they have reached is fine, but emulating their style may not suit us because of our very less risk appetite. Moreover the point where they started and where we are starting is totally different and the strategies which worked in their days may not work for us. But, listening to their advise is not harmful though.

8. Shifting strategy everyday is another way to losses. Have your own strategy for the markets in place and go with it. If your strategy is now working don't change it immediately, have a look at it and analyze why it is not working and try to modify it with changed market conditions.

9. Take joy in trading the markets. Trade only if you enjoy doing it, no matter what happens to you in market. Take everything in lighter note. Never ever let your market worries come into your personal life. You should be brave enough to laugh at yourself when you lose in the market. Only people who are ready to do above are supposed to be the trader. After all market is not the only way to earn money.
Best thing to do when you are loosing in the market is to take a break and stop watching at the ticker have a holiday in some beach city(if you are left with some money..:-))....... Come back and hit the bulls eye.

10. Final thing is never trade with money taken as loan. Always trade with your own money. Never go overshoot on the margins you take from your broker. This will increase the pressure which forces them to take wrong decisions that might ruin their trading career forever.

Happy investing......................................