People sometimes tend to do some basic fundamental mistakes while trading in the stock market.They usually end up in loosing some of the their money before realizing their mistakes.We’ll have a look at some of the common mistakes,so that we can learn beforehand and avoid such situation.
Mistake 1 -Lack of stock market knowledge
Many people directly start trading in the stock market. They do not even bother to gather some basic knowledge of the stock market and expect to make money from the day one.You should always know about the basics and fundamentals of the stock market before actually heading into it.
Mistake 2 – Trading with borrowed money
Never ever start trading in the stock market with the borrowed money in hope that you will return it back after making some good profit.Always start with your surplus money and surplus means even if you lose that money, it should not affect you and your family’s life style.
Mistake 3 – Investing all your money at one go
You should not invest all your trading money in the market at one go.Instead you should invest it at certain intervals.
Mistake 4 – Unrealistic expectations from the stock market
Some people start trading in the stock market with the thinking that they will become millionaires and billionaires within a very short time.They expect to make huge profit from the day one and usually end up loosing their money in the market.
You should always be clear from the day one that making money in stock market requires same qualities as required in other aspects of life eg.hard work,intelligence,patience etc.
Mistake 5 – Panicking with the bad news
In case of bad news or with a sudden fall in the stock price many investors start selling their stocks.Always remember not to panic with the bad news.Carefully analyze the situation and then take any step.
Mistake 6 – Holding back your bad investment
Never ever hold back you bad investment for very long with the expectation that you will recover you investment with time.Instead get out of it and use the same money in some other stocks.You can read more about this here