1. How To Start Trading: Introduction
  2. How To Start Trading: Trading Styles
  3. How To Start Trading: Trading As A Business
  4. How To Start Trading: Trading Technology
  5. How To Start Trading: Order Types
  6. How To Start Trading: Trading Plan Development
  7. How To Start Trading: Testing Your Trading Plan
  8. How To Start Trading: Live Trading Performance
  9. How To Start Trading: Conclusion

The idea of trading for a living is appealing to many people: you get to be your own boss, set your own schedule and work from home while enjoying virtually unlimited income potential. In addition to these factors, anyone with a computer, Internet connection and a small trading account can give it a try. Unlike many other jobs, no degrees, special training or experience is required.
 
Because of these factors, people often fail to acknowledge or realize the financial, emotional and time commitments that are required to build a successful trading business. Here are some quick facts about trading:

  • About 90% of day traders fail within the first year
  • There is no way to eliminate risk in trading
  • There is no trading system that wins 100% of the time
  • You will always have losing trades, even if you are a rock star trader
  • You need money to make money – it will take a long time to get rich with a small trading account
  • Successful independent traders can earn a comfortable income, but most do not become “filthy rich”

The ease with which you can start trading (just open a trading account and hit the “buy” button) in no way implies that becoming a successful and profitable trader is easy. Many of the 90% of traders who fail within the first year do so because they start trading without having developed any type of logical business or trading plan. Any business entered into with such a lack of planning is likely to fail.
 
There is also a lot of deception associated with learning the business of trading. Late night infomercials and hundreds of Web sites would have you believe that trading is easy and that anyone can generate a huge and consistent income from the financial markets. While there may be the rare case where a trader manages to make a huge amount of money in a short time, this is not the norm. For most people, trading involves a lot of hard work before becoming successful.
 
As a business, trading requires constant research, evaluation and discipline. There are no guarantees in the trading business, and you could work a 40-hour week and end up losing money. Anyone considering trading should make sure they have both the personality and financial means to take on this type of business activity.

You might ask yourself: 

  • Am I driven to succeed?
  • How do I handle losing?
  • Do I have time to dedicate to learning the business of trading?
  • Can I stick to a plan?
  • Do I have my family’s support?
  • Do I have money that I can afford to lose?
  • How do I deal with stress?
  • Do I have realistic expectations?

If you want to become a part-time or full-time trader, it is important that you take the time to research and plan your trading business; these are essential steps in your overall success as a trader. This is not a profession at which you will become skilled overnight. Traders who start trading too soon or without a well-researched trading plan often find themselves back at the beginning, but with a lot less trading capital. Traders who have realistic expectations and who treat trading as a business – and not as a hobby or a get-rich-quick scheme – are more likely to beat the odds and become part of the group of traders who succeed.

How To Start Trading: Trading Technology

Related Articles
  1. Trading

    Top 10 Rules For Successful Trading

    Whether you're a novice or an expert, these 10 rules should be the backbone of your trading career.
  2. Trading

    10 Steps To Building A Winning Trading Plan

    It's impossible to avoid disaster without trading rules - make sure you know how to devise them for yourself.
  3. Trading

    How To Start Trading

    Successful trading involves more than reading a few articles or books: you should plan on devoting a substantial amount of time and effort before ever placing a trade in a live market.
  4. Investing

    The Number One Reason Why Most Traders Fail

    We show you the simple tools, availble to everyone, to succeed as an active trader: education, experience, charts, vision, and risk management systems.
  5. Trading

    Are You Ready To Trade Futures?

    If you want to trade futures in the hopes that you'll become rich, you'll have to answer some questions first.
  6. Personal Finance

    Quit Your Job To Trade Stocks?

    Ready to quit your day job and become a full-time trader? These tips will help you determine your area of expertise.
  7. Trading

    The Multiple Lives Of A Stock Trader

    Any trading career will have its ups and downs. Find out how to maximize the good times.
  8. Trading

    How To Become A Day Trader

    We look at the training, tools, equipment and strategies needed to succeed as a day trader.
  9. Trading

    How Successful Forex Traders Manage Profits

    How to balance anticipated vs. confirmed trades to manage potential profits and lower risks.
Frequently Asked Questions
  1. Depreciation Can Shield Taxes, Bolster Cash Flow

    Depreciation can be used as a tax-deductible expense to reduce tax costs, bolstering cash flow
  2. What schools did Warren Buffett attend on his way to getting his science and economics degrees?

    Learn how Warren Buffett became so successful through his attendance at multiple prestigious schools and his real-world experiences.
  3. How many attempts at each CFA exam is a candidate permitted?

    The CFA Institute allows an individual an unlimited amount of attempts at each examination.Although you can attempt the examination ...
  4. What's the average salary of a market research analyst?

    Learn about average stock market analyst salaries in the U.S. and different factors that affect salaries and overall levels ...
Trading Center