Is Making Losses Inevitable?

Discussion in 'Stock Market Education' started by Rainman, Jul 28, 2015.

  1. JR Ewing

    JR Ewing Super Moderator Staff Member

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    [video=youtube;ueqPNNe0mPM]https://www.youtube.com/watch?v=ueqPNNe0mPM[/video]
     
  2. norms options

    norms options Well-Known Member

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    It's impossible to put a number on it because everyone's tolerance for loss will be different. Also, you are asking what is a good number to expect to lose while you are learning and I think the problem with that line of thinking is that you will lose money at all different times of your trading career, if you choose to go that route. However, I want to make sure we are clear and not confusing investing with trading because they are two very different things.

    Trading is where you will be in and out of stocks frequently. It could be daily, monthly, quarterly, etc., but you will be making a lot of trades--buying and selling stocks and options. Investing is very different and basically the term you intend to hold an investment is what makes it different, and the term is long. Long term investing is the best way to build wealth over the course of your life and can help you achieve financial goals, such as saving for your kid's college education or building a retirement nest egg, whereas trading carries a lot more risk because of the frequency that you will be in and out of stocks.

    If you are an investor, and you do not sell when the value of the market or the value of the equities you hold goes down, then you do not suffer losses. Really the only way you lose in an investment situation is if one of your holdings goes out of business, and that loss will be very minimal if you are well diversified. The market will always be a roller coaster, but if you can take the emotion out of it and stay focused on your goals for the long term, your chances of winning are much greater than trying to be a trader.
     
  3. Zander Collision

    Zander Collision Member

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    Trading or investing whatever you call it is like a game. Sometimes you lose or hit the jackpot. It all comes down how well you play and what skills you have. Be consistent, see the fundamentals and analyze the trend.

    Most expert traders are around 50% right when it comes to trading. So don't feel bad if you get 20-30% of the trades right. It is already a huge success.
     

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