Tips For Responsible Trading

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Trading stocks can be a fulfilling way to make money, especially if you are the sort of person who likes waking up every morning to learn new things and take in lots of information. But there are a lot of pitfalls along the way, and there are widely agreed-upon guidelines and rules to follow to help you stay the course and limit the possibility of losing it all overnight.

Check Your Emotions

The first rule is to leave strong emotion out of your trading. This can be a hard one to follow since emotion is not only tied into everything you do, but trading can be an exciting experience that can give you a thrill. Opening the door even to good emotions will allow the bad emotions a hold if the markets turn or may make you hungry for that dopamine rush again. There is also just plain greed which, with all respect to Gordon Gekko, is not always good. For this reason, you need to check your emotions at the door. Yes, enjoy what you do, but don’t tie your emotional state to the outcome of what you do.

Follow A Written Plan

You will already have a plan in mind. Virtually no one goes into trading planning on just winging it, but take time to sit down and decide what that plan is. And once you have fleshed it out, write it on paper so that you can look at it, rewrite it, and pin it up on your wall. Setting your plan down on paper will firm it up in your mind, and by keeping that paper around, you will be less prone to changing it halfway through before it starts bearing its full fruit.

Keep Learning

Markets are changing every minute, every day, every year, and your strategies need to change to reflect those changes. But don’t just take in and process the data; educate yourself on market changes by reading articles, following commentators, or even taking a course. That way, you will stay a stand-out expert in your field instead of one of the rank and file.

Diversify

This doesn’t only apply to your portfolio but also to your activity within a certain market. For example, if you trade in cryptocurrency and are holding onto Bitcoin, you will be highly prone to extreme ups and downs as its value fluctuates. To help protect against this, ensure that you also invest in altcoins as a way to stay stable in that market, using OKX.com to track the performance of altcoins across the board.

Step Away From The Computer

This is more than just taking regular breaks. This is about taking your head out of the feeds and chatter to clear, relax, and maintain perspective. A tired investor with tunnel vision will be a poor investor. A lot of this game is about making focused, considered decisions, and you won’t be able to do that if you are strung out and exhausted. It’s very easy to get sucked into the flow, and that is why you want to turn off your computer, run, work in the garden, and do whatever it takes for your conscious brain to switch to other tasks while your subconscious takes over.