SteadyOptions is an options trading forum where you can find solutions from top options traders. TRY IT FREE!

We’ve all been there… researching options strategies and unable to find the answers we’re looking for. SteadyOptions has your solution.

3 Key Pieces Of Advice For New Traders


These days, everyone claims to be an ‘expert’ on absolutely everything. Apparently, it only takes having a Twitter account to be a seasoned expert on any given subject; all in all, the Internet is full of nonsense. It’s becoming harder and harder to find legitimate answers amongst the quagmire of false information online.

Especially when it comes to investing, there are many schemes out there which promise fast money with very little research or work involved. Sadly, a lot of people fall for these schemes, believing that if the company seems legitimate, they must know what they’re doing. It’s a recipe for disaster when putting your money in the hands of untrustworthy sources.

 

New traders don’t have to be prey for scammers, however. With the right advice, research and commitment, new traders can become successful in their endeavours in what seems like no time. Learning the trade takes time and work, but with good guidance, success can and will come your way. 

 

Here are the best pieces of advice any new trader could follow. 

 

1. Invest time before money

Of course, this doesn’t mean literal time must be invested. But the importance of this statement is that before you begin trading, the research must be done. Trading is like any job you take seriously; it requires concentration, dedication, and acceptance that things don’t always work out the way you want. Avoiding running before you can walk means finding the best trading platform for you and learning how it works, inside and out. 

 

Keeping up with key events that affect the stock market is of paramount importance. The better you understand how these fluctuations work, the better equipped you are to begin trading. Nowadays, there are so many fantastic sources from which to learn: check out TED talks, and reputable economic report sources, to begin with. Seek advice from friends or family who have been involved in trading before; learn from others’ mistakes before you make your own. 

 

The more research you do, the more you learn that making mistakes in the trading business is inevitable. The foundation of knowledge you build before you begin doesn’t just set you up for success, it prepares you for the downfalls of trading too. 

 

2. Learn your terminology

Traders speak their own special kind of language. To the average non-trader, reading a report or listening to a professional trader speak would be about as helpful as listening to someone speak another language altogether. There are hundreds of terms to learn, and being up to date on this language is a serious step in your journey to becoming a seasoned trader. Speaking the language will assist your ability to trade wisely and with confidence; stumbling around in the dark, however, might increase your risk of unwise investments. 

 

Understanding the money side of things is the easy part; using helpful online tools such as a dollar cost averaging calculator can tell you all you need to know. Having the lingo nailed is not just about looking good; it could save your bacon, too. Misunderstanding a report’s findings could lead you to make a mistake in where you put your money. 

 

3. Ask yourself what you want

Trading isn’t just financial, it’s emotional. The emotional mistakes that can be made as a new trader are frequent and many, and there is plenty of advice written about how to avoid them. However, one thing less frequently explained is that in order to begin as a trader you must ask yourself what your goals are. 

 

The life of a trader sounds easy - you invest money, you profit, or fail. However, the time, effort and elements of risk that trading involves are not for everybody. All traders want to make money, but are you willing to go the distance? There will be elements of trading which can make you stressed, as with any job or investment, but those who stick to a long term plan and move steadily to meet their goals are the ones that succeed. Getting rich quick is not the aim of a successful trader; it is a marathon, not a sprint. 

 

Discussing your plans to be involved in trading with your significant other, friends and family is important - especially if your finances are tied up with theirs. Although trading can reap incredible rewards, it can take a significant amount of time to get it right. Reading up, finding the right platform and accepting the journey will all allow you to enter this exciting world head-on. 

 

This is a contributed post.

What Is SteadyOptions?

Full Trading Plan

Complete Portfolio Approach

Diversified Options Strategies

Exclusive Community Forum

Steady And Consistent Gains

High Quality Education

Risk Management, Portfolio Size

Performance based on real fills

Try It Free

Non-directional Options Strategies

10-15 trade Ideas Per Month

Targets 5-7% Monthly Net Return

Visit our Education Center

Recent Articles

Articles

  • Option Arbitrage Risks

    Options traders dealing in arbitrage might not appreciate the forms of risk they face. The typical arbitrage position is found in synthetic long or short stock. In these positions, the combined options act exactly like the underlying. This creates the arbitrage.  

    By Michael C. Thomsett,

    • 0 comments
    • 127 views
  • Why Haven't You Started Investing Yet?

    You are probably aware that investment opportunities are great for building wealth. Whether you opt for stocks and shares, precious metals, forex trading, or something else besides, you could afford yourself financial freedom. But if you haven't dipped your toes into the world of investing yet, we have to ask ourselves why.

    By Kim,

    • 0 comments
    • 85 views
  • Historical Drawdowns for Global Equity Portfolios

    Globally diversified equity portfolios typically hold thousands of stocks across dozens of countries. This degree of diversification minimizes the risk of a single company, country, or sector. Because of this diversification, investors should be cautious about confusing temporary declines with permanent loss of capital like with single stocks.

    By Jesse,

    • 0 comments
    • 81 views
  • Types of Volatility

    Are most options traders aware of five different types of volatility? Probably not. Most only deal with two types, historical and implied. All five types (historical, implied, future, forecast and seasonal), deserve some explanation and study.

    By Michael C. Thomsett,

    • 0 comments
    • 196 views
  • The Performance Gap Between Large Growth and Small Value Stocks

    Academic research suggests there are differences in expected returns among stocks over the long-term.  Small companies with low fundamental valuations (Small Cap Value) have higher expected returns than big companies with high valuations (Large Cap Growth).

    By Jesse,

    • 0 comments
    • 430 views
  • How New Traders Can Use Trade Psychology To Succeed

    People have been trying to figure out just what makes humans tick for hundreds of years.  In some respects, we’ve come a long way, in others, we’ve barely scratched the surface. Like it or not, many industries take advantage of this knowledge to influence our behaviour and buying patterns.

    By Kim,

    • 0 comments
    • 280 views
  • A Reliable Reversal Signal

    Options traders struggle constantly with the quest for reliable reversal signals. Finding these lets you time your entry and exit expertly, if you only know how to interpret the signs and pay attention to the trendlines. One such signal is a combination of modified Bollinger Bands and a crossover signal.

    By Michael C. Thomsett,

    • 0 comments
    • 516 views
  • Premium at Risk

    Should options traders consider “premium at risk” when entering strategies? Most traders focus on calculated maximum profit or loss and breakeven price levels. But inefficiencies in option behavior, especially when close to expiration, make these basic calculations limited in value, and at times misleading.

    By Michael C. Thomsett,

    • 0 comments
    • 432 views
  • Diversified Leveraged Anchor Performance

    In our continued efforts to improve the Anchor strategy, in April of this year we began tracking a Diversified Leveraged Anchor strategy, under the theory that, over time, a diversified portfolio performs better than an undiversified portfolio in numerous metrics.  Not only does overall performance tend to increase, but volatility and drawdowns tend to decrease:

    By cwelsh,

    • 1 comment
    • 619 views
  • The Best Chart I’ve Seen in 2020

    The best visual aids for learning are often very simple. The chart in this article was created by Paul Merriman, using data from Dimensional Fund Advisors. I primarily use Dimensional Funds in building portfolios for my clients. There are many takeaways from this chart, and I’d like to share a few thoughts that stick out most to me.

    By Jesse,

    • 0 comments
    • 633 views

  Report Article

We want to hear from you!


There are no comments to display.



Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account. It's easy and free!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now

Options Trading Blogs Expertido