In this article I am going to talk about some common misbeliefs that stop people from trading, let's get straight into it.
1. Trading is Gambling
"Is that not just gambling?" Christ! That single statement is the reason I advise most traders to not tell people (except for other traders) they trade. Yes, I admit that trading CAN easily sound and even feel like gambling as it involves risk — the market will not always go your way but there's systems and strategies traders use to manage risk, that's what trading mostly is — risk management.
When you trade (properly, that is) you're risking a very small part of your money with the possibilty of earning more as the trade goes your way— but it won't always go your way. While that sounds like a gamble — don't most ventures involve risk? We take risks everyday, Entrepreneurs risk wastage of time and money, surgeons risk the lives of their patients for the possibility of improving their patients' lives through surgery.
So yes trading involves risk, but it's about taking SMART RISKS and Calculated risk based on patterns in the market you have noticed over and over again repeat themselves. It's risky but I promise you it won't feel like gambling when done properly.
Check out how I swing trade to reduce the feeling of gambling most traders feel.
2. "Trading is time consuming always analysing charts"
Yes, I agree that it can be like that, this was my realization spending over a year as an amateur trader trying to make day trading work. Before I switched from viewing charts on lower time frames like the 5M (5 minutes for each candles stick to form) I would find myself sitting for hours on the charts trying to find signals to enter trades while fighting the urge to not check my notifications or any of the thousands of distractions in my life.
Trading became such a drag and I started to think "there's got to be a better way"
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then I decided to switch to swing trading and started using 4H (4 hours per candle) as my lowest time frame. Now I barely spend any time (maybe a few minutes a day) viewing the charts, I can spend a whole day not having to look at my chart or trades, I rely on alerts I set on my phone to know when interesting prices have been reached and that's when I check out my charts. Yes I do get that eagerness to check my trades ever so often but that's mostly on the less busier days.
I highly recommend swing trading if this is one of your fears getting into trading, it's great for moms, 9-5 workers, students and really anyone who doesn't have time to sit in front of a screen for hours
Check out how I swing trade in this article
3. You need much money
You don't need much money to start trading, infact for your first account I recommend you start with the least amount possible to reduce the emotional strain as a beginner, I restarted crypto trading after months of paper trading with just $20, that's it. I also recommend most beginners to start their journey paper trading (trading with fake money) for about a few weeks or months to build up their risk management skills and trading technique along side journaling.
Here's an article about how paper trading and journaling can transform your trading.
I believe in a simple philosophy when it
comes to trading: skill is more important than money when it comes to profiting and I believe when you give anyone without the skill of trading any amount of capital to trade they will all end of with the same results — a blown out account.
Give someone with a good understanding of the market and risk management skills a little amount of money and with time he will trade up that money to something sizeable, give someone with no experience or skill trading even the little money large capital and he will waste it all like pouring sand into the ocean, I've personally experienced both sides of this scenario.
4. It's hard to learn/ you need to be smart
There is a learning curve I admit, but is that not the same for most things worth getting into? Yes it will take a while to learn about the charts, indicators and risk management but I assure you do not need to be "smart" to become a trader.
Ironically, I find that the more conventionally smart people find it hard to be successful trading because they easily get in their own way instead of just following what the market and trading tools are telling them to do, and those who trade with a more "accepting" mindset often come out top.
There are a lot of people who struggled in school but have found trading to be straightforward and understandable — the best traders often come from this bunch.
So yes it will take time to learn and implement some of the skills you'll have to master to become profitable in the long run and sacrifices of money and time will be required but you don't have to be book smart to master any of the skills needed to become a trader, it's mostly common sense. I find that the simple stuff are the stuff you use the most. If you're looking to learn trading as a beginner, then Check out my trading for the absolute beginner teaching series here.
5. You need fancy equipment to start and be successful.
I watched a trading related video recently and this guy was talking about how we shouldn't take anyone who trades with their phones seriously, my eyes rolled back so much I almost looked like the Dune Mentat lol. Yes you can absolutely trade profitably on your phone, you're looking at a chart on a screen what matters how big or small that screen is?
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when they say you can't trade on your phone |
Here's an article on exactly how I do so.
I use just two applications on my phone to trade, Tradingview: where I look at my charts and am able to use my indicators and Binance: who I use as my broker to place the actual trades. Anyone that tells you that you need a big screen or a fancy setup to trade is either doing the sort of trading on the lowere time frames I would not recommend for beginners or they're doing so because they can. All you need is any device with internet access (phone, tablet or laptop) a charting app like Tradingview and a broker like Binance to start trading properly and profitably.
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You don't need any of this to be a profitable trader |
Tori Trades, one of the most famous and profitable traders online is famous for stating she swing trades on her phone and truly anyone who's done swing trading profitably will say it's very possible.
Check out this article to see how I swing trade slowly but profitably on my mobile device.
Now that you've had most of those limiting
believes sorted out why not start now?
Let's get you trading? Click here to set yourself up for trading...