5 Stock Tips to becoming a Successful Trader

When People look for stock tips they look for someone to tell them which stock will go up and make them a million dollars. But I’m going to give you something much more valuable, especially when you consider most “Hot Picks” don’t do so well.

If you want to learn how to make a nice return in the market you are going to want to learn the ropes yourself. That is all there is to it. You can’t rely on someone else to give you “Hot Stocks” because they will either have no clue what they are talking about or you will not play it the same way as them.

Luckily anyone can learn to trade the market. And if you are going to trade or invest there are 5 critical stock tips that you must follow.

Here they are my 5 stock tips.

1. Control Your Emotions

Being in the market is a constant struggle with your emotions. If your stock goes up even a little you get the urge to sell everything and walk away a proud man or woman with your tinny little profit. If the stock goes down you want to watch it all day as if that would make it change directions.

Emotions are bad (at least when it comes to the stock market) you can’t make any rational decisions when you are obsessed with every little thing. How could you, the slightest tick can bring so many emotions your way, good or bad and make you react differently, stressed, overjoyed, whatever it is.

This is one of the key elements that keeps so many traders and investors from making a decent return in the market, in fact, if you can’t control your emotions none of the other stock tips here will help you. But how can you do it? You are human after all.

The best way is to have specific rules that tell you when to get in and when to get out of a stock, and follow them. This will make sure your emotions will have no control over your position. You can only get out once your rules tell you to and not before.

Another thing you can do which will help control your emotions and follow your rules is to use smaller positions. Forget the fact that going all in 1 position is foolish anyways, but keeping your positions small will put less emotional stress on you, which will help you react more rationally.

2. Learning From Bad Trades

We all make bad trades, it can be hard to handle when you have lost some money trading. After all when you are just getting started you aren’t expecting it to happen. The stock market is supposed to make you money right? You’re not supposed to lose the stock can’t go down, that’s the wrong way.

Well, unfortunately experiencing losses are a natural occurrence in the stock market. The only thing you can do is learn from them.

Whenever you lose money don’t lose the lesson. Figure out why you lost and see what you could have done differently next time. Maybe there wasn’t anything you did wrong, the trade just didn’t work, it happens. In that case I just hope you kept your loss small by setting stops like I teach you.

Learning from your past trades helps you do well with other stock tips like controlling your emotions. When you do have a bad trade don’t consider it a bad trade. Consider it an education expense, you pay for college, the stock market is no different.

The money you lose will be put to good use if you take the lesson and use it to profit next time around.

3. Take A Breaker

Out of all these stock tips this is the one no one wants to hear, but it’s true. You can’t be involved in the markets every hour of the day. In fact sometimes being involved every day is too much.

Take some time off, remember to set your stops before you do, then let yourself get unstressed. Go fishing, golfing, play pool, do something else that will let you have fun and take your mind off the markets. There are other things in this world then money.

It will probably also benefit to your trading, sometimes it is better to take a break, especially when you are on a losing streak and come back later with a refreshed mind. You’ll be surprised at the results you can get.

4. Be risk Cautious

Most new traders look at the stock market as a pot of gold. You grab as many golden coins as possible then run off with a huge smile on your face. At least that is how I first imagined the market would be.

But it’s not, you’re going to win some and lose some. No matter who tells you otherwise it is not profit, profit, profit, it is profit, loss, loss, profit.

You can’t control when you will experience a profit and when you will experience a loss. The only thing you can control is how much you will lose if you are wrong.

So make it your business to cut your losses short and let your winners ride. The less you allow yourself to lose on a trade when you are wrong the less often you will have to be right to make a great return trading the markets.

Make use of things like stop orders, position sizing, and risk management. They can be your best friend in the markets, and save you from being one of the herd panicking while they see their accounts drop 50+% in a bears market.

Out of all the stock tips here this would probably tie for the most important with controlling your emotions. The best trader in the world is no different than a bum on the street if he loses all of his capital. Remember this is a business; your capital is the lifeblood of your business so guard it well.

5. Follow Your Rules

The Last of these stock tips is the icing on the cake. It is what puts everything together and makes you a profitable trader.

If you want to succeed you must have a set of rules that allows you to, cut your losses short, let your winners ride, and keep your emotions under wrapped.

This should take everything into consideration, how much you are willing to risk per trade, your time frame, everything. Remember your trading rules should never be broken, no matter what. The biggest mistakes I have ever made in the stock market happened when I did not follow my trading rules. Don’t make the same mistakes.

Now, as you learn and grow you might want to adjust your rules a little (not while you are in a trade of course). And see if you can’t make yourself even more profitable. But following your rules should be a daily practice for you.

Remember those stock tips. They can be very valuable for anyone willing to take the time to profit as a successful trader.