If You Want to Grow Your Money, NEVER OVERTRADE!
Theory of Trading - Do Not OVERTRADE Ever!
If you follow this theory, you will have a chance to become a successful trader over a period of time and if you do NOT follow this rule, you will loose your money quickly and surely.
THIS IS THE BEST, EASY AND SIMPLEST THEORY
What is Overtrading?
To help you understand in a layman language, over trading is risking too much money on a given trade.
For example, if you have $100 in your account, you should limit your loses to 2% of your account balance that means, you should only trades with the amount of $2. This way, you will have chances to place trades again in case your first trade goes wrong. You will still have money to play around on another day or the next day.
In other ways, continue to place trades in a single day. For example, 20 trades, 30 trades, 100 trades in a day.
With the balance of $100, you might think you can place 100 trades of $1 in a single day. Now if your 50 trades are positive and 50 trades are negative, you are still losing money.
There are times, when you just can't stop yourself and control your emotions that let's you going and keep trading. You get excited over every perceived opportunity that opens up in front of you.
You continue to think about what you may miss or might be missing. But this is not the right way to trade. Such a mind set needs to be treated and ideally removed from your trading.
Despite what some might think, you will never get rich by trading more. You get rich by being really picky over what you decide to trade.
You need to be patient here and over a time span you can definitely make your fortune.
Over trading is often referred to as ‘trading very frequently’ and this is one of the primary ways a new trader lose everything.
I'm sharing a similar short story that can also help you in understanding this theory in a better way!
When a mouse was put at the top of a jar filled with grains. He was too happy to find so much of food around him. Now he doesn't need to run around searching for food and can happily lead his life.
He thinks life is fine and nice because he is satisfied.
He has something to eat !
That's why he will stay and enjoy until he runs out of them.
Until one day.... the jar will be empty and he will see that he has been trapped and will never be able to get out of the jar.
Moral : Learn from this story! Never put all of your money. Whatever amount you spend, always keep control of your emotions.
Don't get SAD with the losses.. and keep trading!
And Never get excited with PROFITS and continue to trade!
Learn how money works for you rather than you work for money.
Click here to get a free trading account now!
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