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5 Reasons Why Trading Isn’t Working for You.

A staggering 90% of investors make losses in the market! Is it time to clear out that portfolio and get out of the market? Certainly not. The reason 90% of them fail is because of these 5 reasons we’re about to show you

5 Reasons Why Trading isn’t Working Out for You

Let’s face it, you’re probably here as you’re feeling lost and hopeless with your performance in the stock market. Fret not, you are not the only one facing these issues in the market. A staggering 90% of investors make losses in the market! Is it time to clear out that portfolio and get out of the market? Certainly not. The reason 90% of them fail is because of these 5 reasons we’re about to show you:

  1. Emotions

We definitely have got to start off with this one here. Many, many, many people fail to make a profit in the market due to their emotions affecting their decision-making when they are trading or investing. Here’s a great chart that depicts regular investors’ emotions in the market.

Source: wallstcheatsheet.com

Often times, whether in times of unrealised profit or losses, investors and traders start to act irrationally. They hope for the stock prices to go up when they’re at a bad loss or even when they’re already at a high! That is exactly what happens when you don’t stick to your plan, or worse, not even having one!This brings us to number 2.

  1. Not planning ahead

If you fail to plan, you are planning to fail.” – Benjamin Franklin

You’ve probably heard this quote at least once in your lifetime. Cliché as it sounds, planning is one of the most important elements of investing. If you are going into the market without a plan or trading strategy, you might as well invest in your friend’s, brother’s, wife’s, cousin’s new shady business.

To be a better investor, PLAN AHEAD. Have a strategy in mind before you invest. Know when to take profit, cut losses or hold on. Learn about how you should allocate your assets according to the situation. Plan ahead by looking at how the marketing is performing or how the company is performing. That way, when the time comes, you’llknow the decisions that you have made.

You can also tune into M+ Weekly Bites every Wednesday to get weekly market insights to help you with your planning:

https://www.facebook.com/watch/401900773181313/367996034414482

  1. Haven’t learnt the basics

Another reason why trading isn’t working out for you might be that you have yet to grasp the basics in the market. This means not knowing how to read technical charts, study a company’s financials or even understanding the various products in the market.

Candlestick charts and Financial Statements might seem really overwhelming to look at, but it is REALLY easier than you might think. So if you have yet to learn any basics, grab your phone, contact your broker today!

  1. Relying on TIPS

So learning the basics didn’t work out for you, so you cave into using tips or “trading ideas” from unlicensed sources (or even your aunt). By solely relying on stock tips, you are basically putting your portfolio at the risk of another’s idea. Did they even conduct the right and proper method of selecting the stock?

Here’s how dangerous it is to get investment advice from unlicensed sources:

https://www.sc.com.my/resources/media/media-release/sc-issues-cease-and-desist-order-to-seven-unlicensed-operators-offering-investment-advice

If you do want to get legit investment advice, do look for brokers that are licensed under the Securities Commission Malaysia.

  1. Not doing any research (or a proper one)

Well, you’ve overcome your emotions in trading, but you’re still not making a profit in the market. This might be the next concern that you should be looking at. Before buying a stock, it is of utmost importance to do some research on the company and look at its chart (if you’re a TA person).

Here are some pointers:

  1. Is the industry/company currently in trend with the market?
  2. Are the financials strong?
  3. Are there any opportunities ahead for the company’s growth?
  4. What are the target price and cut loss points that you should look at?

If you do need help on what else you can look at to improve your research skills, you can tune in to our live webinars on Facebook: https://www.facebook.com/mplusonline/videos

In conclusion, trading/investing isn’t hard nor easy, but you just have got to plan ahead and make the right decisions or calculated risks before entering the market. Now go out there and start your trading journey!

Ready to start your journey? Visit https://registration.mplusonline.com

Disclaimer: This article is for general information only and is not a recommendation, offer or solicitation to buy or sell any investment product. Investments are subject to investment risks. The risk of loss in stock trading can be substantial and you could lose your initial capital. Do seek a licensed broker before you engage in any trading activity.

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