Why Most Stock Traders Fail

Expectations, Education, Patience. All of the above are critical if you want to turn a profit by buying and trading stocks.

Expectations: Understand your goal. Like, really understand it. Odds are your reasons are practical: retirement, kid’s college funds, etc. If these are your plans, understand that your deadline is in the distant future and that there will be an ebb and flow to your journey.

It may have felt like everyone became a millionaire through meme stocks, but the reality is that the vast majority did not. Like, almost all traders did not. However, A LOT of traders caught FOMO and made panic deals either too early or too late and lost money. Expect to miss the major waves, expect your journey to be relatively boring, and expect a few major dips. The good news is, traditionally speaking, by continuing to invest over the course of the journey, you are almost guaranteed to make a good amount of money.

Education: There is a lot to learn. Going in blind and off the advice of a few personalities you follow won’t cut it. You need to take ownership of your stocks and understand the nuance that comes with trading and ownership.

If you’re looking to trade more frequently, and match short-term gains with long-term planning, you really need to understand calls/puts. Learning options and how to capitalize on them is a great way to earn for short-, intermediate-, and long-term goals.

Related: Best Day Trading Courses

Patience: If you couldn’t tell, this is a recurring theme. There is nothing better than following your instincts and picking a winning stock. Conversely, there is nothing worse than following your instincts, investing in a stock, selling it prematurely, and watching your ‘what could have been’ earnings climb, and climb, and climb.

If you’re in it for the long haul, be in it for the long haul.

Finally, most traders fail because of missed opportunities. Usually, you’ll have a pretty good idea of what you want to do. You’ve likely identified a price point you’ll buy or sell a stock at. And usually, you’ll miss it. It’s hard to hit all the marks when trading isn’t your full-time job. We have lives, kids, and other careers that take precedence.

In lieu of hiring a personal assistant to watch your present and potential stocks, consider joining Benzinga Pro.

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