When I became aware of the increasing use of the stock market, or in other words, when a colleague suggested I look at trading instead of saving bonds, I started to buy a well know stocks and shares magazine, from the local newsagent.
I remember getting really interested in some of the advertisements for trading tuition, one company stood off the page to me at the time. Anyway, I invested in a day course and took up their subscription offer for daily bulletins, which basically gave me one or two trading position to open up, based on their analysis - which they kept secret behind locked doors.
I wish I had been wiser. They really did want to give a trader fish to eat, rather than teach them to fish! Under no circumstances were they about to divulge their system. Anyway, I was receiving those bulletins and trying to make head and tail of them along the way. There's only so much you can remember from a day seminar, in spite of load of scribbled notes, you know what I mean, even writing notes around the punched holes in the paper.
So there were a few emails going back and forth and I was opening a trade or two. Unfortunately, my account at the time had just tipped over the minimum starter allowance of a penny a point and now I had a minimum of 50 pence a point; I was spread betting and still use that same vehicle.
Anyway, based on the figures I received, I opened a position. I think I bought Gold. However, I made a grave error. I failed to use a stop loss management order! The first five minutes were not too bad as I watched the price moving about within a reasonable margin, but then it started to drop. And I started to panic.
I watched with utter horror as my little account fell about $1200 Dollars in about twenty seconds. It had all but wiped me out by the time my frantic key tapping had found the BUY facility in my online platform. No choice.
Needless to say, that taught me a valuable lesson. If you day trade or swing trade, never ignore that stop loss button. There are very experienced traders who wouldn't use one, for their own valid reasons, but for the beginner, or hobby trader, unless you're scalping, I would suggest using it.
How would you like to discover more about the techniques successful traders use to make profitable trades?
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Ian Jackson is an authority on Day Trading information, learning the hard way - and now he reveals how you can learn the business too, without all the growing pains.
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