I remember sitting at my computer early in 2017 looking at my shitty savings account. Don’t get me wrong, I have the usual responsible investments, 401K, etc. I had this savings account that didn’t have much in it. I didn’t make enough to make it grow, and I was tired of seeing the generous .8 cent interest payments from the bank. I saw an ad for Robinhood, an app that offered zero commission trades. I had never traded a stock in my life, and I had no idea what was good to buy or when to buy it. Sounded great! I moved my small savings over to Robinhood and started my adventure.
I read the typical stories from people who have been trading for years. Most of them had terrible lessons learned where they lost their entire accounts. I’m not a big risk taker, so this was out of my element. I refused to call this gambling though. I wasn’t planning on buying penny stocks, or taking gigantic risks. I wanted to learn how to read charts and forecasts. I wanted to learn about what to buy and when to buy it.
The first thing I did when I opened my Robinhood account was buy a low risk stock with a good reputation. I purchased shares of Starbucks (SBUX) and then started my research. Days later, I had already made decent money. I was hooked.
There is so much out there in terms of information, that it can get really overwhelming. A gigantic portion of it is pure shit. Dudes talking about waking up, making a few grand in an hour or two, hitting the gym, and relaxing on the beach. I’m sure there are dudes that do this, but it’s not what you should be reading. For the most part, it’s fantasy. The first thing I did was find the “must read” books, recommended by real traders. I read a bunch of them, but the two that I highly recommend are:
Don’t be turned off by the origin date of “Reminiscences of a Stock Operator,” the book is timeless, and almost everything in it is relevant to trading today in some way. The other book, “Trading in the Zone,” is a great book about how to overcome your fear of executing a trade. A lot of people (including me) would freak out over every tick. That attitude is a guaranteed recipe for failure. This book was essential for me to learn how to approach trading in a totally different way.
My other favorite source of information was the podcast, “52 Traders” with Cam Hawkins. This is by far the best Podcast/Website for new traders. Cam started the site with the intention of becoming a good trader, interviewing 52 of the best traders he could find. Every interview is insanely informative, and cam accompanies these podcasts with charts and statements on the site. The podcast became successful, so once the 52 interviews were completed, he just continued the show with more topics and interviews.
My 2017 trading ended up being in the negative, but only by a few hundred bucks. at one point I was up almost 50%. The lessons I learned from my losses were extremely valuable, so the moves I have made in 2018 have already been successful. Trading can be stressful, but you learn a lot about yourself from doing it. Discipline is the number one requirement. Always obey your stops. Every loss I took was me not listening to that advise. In 2018, I won’t do that again.
Have you recently started trading? How has it been going for you?
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