How to Get Started in Trading: A Beginner’s Guide to Starting Trading Journey
Would you like to know how to get started in trading? Do you want to become a trader? Or have you dipped your toes in the water but are struggling to find the right direction? Are you uncertain if trading is the right thing to do? Perhaps you are better off investing for the long term?
This article discusses how to get started in trading. To make money from short-term movements is a challenging game, but we believe it’s possible to increase the odds of success by taking the time to learn some basic skills. This is article highlights some issues that need to be addressed, preferably before you start trading.
In this article, we only consider “self-funded” traders who trade their own capital, not, for example, prop traders.
To get started in trading, you need to set realistic goals, determine your motivation, and understand your strongest personality traits. Only then can you think about your investment horizon and trading style. We believe you stand the best chance by learning to code simple strategies to trade automatically and quantitatively via software.
Before you start trading, remember that most traders lose money
First, a turn-off: very few short-term traders make a lot of money. By a lot of money, we mean above 200 000 USD a year. It all depends on your bankroll, of course, but most traders start with reasonably small accounts.
Moreover, averages are a bit meaningless as the numbers are highly skewed to a tiny fraction of traders that make a lot of money. We assume the median trader loses money.
We repeat: both the average and median trades most likely lose money. Some even lose their life savings. You don’t want to be one of those.
Keep this in mind whenever you dream of easy money.
What is your financial goal?
Before you start you need to determine your goals: What are your aims? This is the most important question you need to address before you start.
Do you want to trade for a living, are you saving for your retirement, or is trading a side job besides your full-time job? Trading for excitement is also a valid reason, but only with money, you can afford to lose. Your goal(s) determines what kind of approach you should choose.
By interacting with independent traders for over two decades, we know that one of the main motivations is freedom and not working from 9 to 5 for the man. We all want the freedom to do what we want, but this requires a great deal of discipline and passion. You have to factor in loneliness, boredom, lack of human in