We have read the stories, heard the rags to riches stories, and even known real people close to us who just quit their lucrative day jobs to become a full time trader. Unfortunately, living the trading dream is not for everyone. Some people are simply not suitable for trading, probably due to their personal disposition, their attitude, their personal resources, and their scope of knowledge.
If you fall under any of those categories discussed below , you probably need to forget about making your fortune in trading , better protect your capital and save yourself from financial disaster.
Here are some of the reasons you should quit trading.
1. Lack of Trade Discipline
Do you find yourself breaking your commitments often and reneging on promises?
If you cannot follow your trading strategy, you will enter into many trades on impulse and this is very likely to have disastrous consequences on your trading account.
You need to be disciplined enough to do your research and perform your market analysis each time before you make any trade decisions. Otherwise, the only bank you will be breaking is your own bank account.Do remember Patience is a virtue
2. Emotional Instability
If your trading decisions are usually driven by either fear, greed, or other emotions, you are not at all suitable for trading.Trading in stock market needs a trusted and back tested trading strategy with proper risk and money management.
If any time you enter a trade you find yourself glued to your computer screen afraid to go to bed or even go to the bathroom, then trading is clearly not for you.If you are always shifting your stop loss levels in ongoing trade setups hoping for a price reversal, withdraw the balance on your trading account right now and go invest in something else.
To be profitable while trading , you need to make your analysis, set your stop loss and take profit levels, and trust your analysis to bear fruit.
3. Lack of Trading Passion
When you wake up every morning, what is your first thought about your trading?
Are you filled with dread or do you feel energized and look forward to watching price movement on charts?
When you watch financial news, do you find yourself dozing off or do you find yourself mentally calculating the short term and long term effects of recent announcements by governments and big firms?
If in the two scenarios your reaction falls in the former category rather than the latter, get out fast from the financial market.
You need to have a passion for what you do. It is not only good for your finances, it is also good for your heart, your morale, and your total outlook on life.If the prospect of doing a market analysis fills you with trepidation, stop it and get out.
4. Lack of Time to Follow the Market
Most strategies in the stock market do not require you to be always at your screen watching price movements.However, to be a successful trader, you need to have a grasp of what is happening in the stock market. This knowledge will make your market analysis easier and faster and your trades easier to manage.
5. Lack of Necessary Resources
What are the basic things that a trader needs for success? They include some funds to run the account, a device to access your account, an internet connection to manage your account online, a good broker and a reliable trade platform, and knowledge on how to profitably trade online.If you do not have a computer and your hand held device cannot access a trading platform, get out of the market.
If you have no internet connection or whatever you have is either slow or unreliable, you will have too much slippage and lose huge amounts of investments in the market. If you lack any of these resources, get them first then start trading.
6. Poor Brokerage Services
Your broker is your key to unlocking the high profits hidden within the market. Unfortunately, there are some grossly ill-equipped brokers offering poor services. If your broker charges high commissions and high spreads, quit working with them or all your profits will disappear in charges.If your broker in unresponsive to your queries or makes fund withdrawals impossible, quit while you can.
7. Lack of Business Acumen
This world has two types of people and it has been like that since before the invention of fire.We have risk takers and those who avoid risks. Most retail traders today are people who invest their own money and manage their trades at home from their personal computers or hand held devices.If you are not able to manage your investments without strict supervision from some boss, then you can do either one of two things.
You can safely save your money in a savings bank account and earn interest or Invest in Liquid funds, MF’s where money is managed by professionals.
The market is a level playing field open to anyone and everyone. However, just because you can enter the market does not mean you will do well in it.
If any of the above factors apply to you, then you have a compelling reason to get out of the market.
Take care of your issues first then come and trade and you will find that you will be even more profitable than before.