Part time trading is a process that’s becoming overwhelmingly popular, and for good reason. It’s a process that can be overwhelmingly profitable, giving you the ability to make money outside of your day job. However, making a profit in the world of part time trading takes more than just pushing a button. You’ll need to make the right moves or you will end up with a loss. Today, we’ll talk about 5 tips that can help you reach profitability as a part-time trader.
Tip #1: Talk With Experienced Traders That Can Give You Practical Advice
While you may not think you know any day traders that are experienced in making money in the market, just about everyone does. The truth is that finances aren’t something that everyone shares with everyone. However, if you reach out to your pool of friends and ask “do you trade?” chances are that at least 2 or 3 of your close friends and family members will say yes. Before getting started, talk to people that you trust that have experience trading. Ultimately, the goal here is to get practical advice that doesn’t come with a goal of making money off of you.
Tip #2: Your Strategy Is All You’ve Got
At the end of the day, your trading strategy dictates the assets that you trade, how you trade them, when you trade them and the profits or losses that you realize. With that said, it’s a good idea to take some time to learn about various strategies and dig up one that works well to match your goals. Choosing the strategy that you will use when you trade is one of the most important decisions you will make when working in the market.
Tip #3: Only Work With Trusted Brokers
There are thousands upon thousands of brokers online these days, each claiming to have the best service. However, there’s only a hand full or so of trusted brokers out there. Don’t take a chance on working with a shoddy broker in an attempt to gain an edge on the competition. Always make sure that your broker is regulated and well trusted. It’s a good idea to verify regulation and read reviews written by traders before choosing your broker.
Tip #4: Control Your Emotions
As human beings, we are all emotional creatures. Emotions are wired into us! However, emotions are the enemy of part-time traders. At the end of the day, fear and greed are the two emotions that drive the market, and getting too emotional with your trading could drive you straight to a loss. Here are the two big issues with emotional trading that you should avoid….
- Fear Of Loss – Fear of loss drives trades for many beginners. After losing some money, the trader is afraid of ending the day on a loss. So, they find themselves following the trend, losing money every step of the way. Never allow fear to cause you to chase profits.
- Greed – Greed based trading is another way that beginners find themselves at a loss… literally! Often times, when a trade goes overwhelmingly well, greed sets in. Unhappy with the profits the beginners have already made and not ready to move onto the next trade, beginners often try to chase trends further into the profit, only to cut into their already realized profits, or even lead to a loss!
Tip #5: Keep A Trading Journal
Finally, it’s a good idea to keep a trading journal. Keep track of each trade you make. The reason for the trade, how much money you gained or lost, and any notes that you can think to add. At the end of your trading day, look back at your trading journal, not just for that day, but for the past few weeks. Your goal is to learn from your actions. When you see that you consistently make profit for one reason or another, make sure to use that information to improve your strategy. If you’re consistently losing on specific trades for one reason or another, use that information to better your strategy as well!
At the end of the day, part-time trading can be a great way to put extra money in your bank account. However, it’s important to do your research, work with a strong broker, keep your emotions in check, talk to experienced traders, and keep a trading journal. By following all of these tips, you may be able to work your way from part time trading to turning trading into a full time income generator!