My name is Dylan Peacock and I have only been trading for 2 months. In the first week I was very unsure of my decision to start just because of how long the learning process would take. I had no idea how to trade, how to manage my money, emotions or even what to expect from trading. All I knew was that trading is a good way to make money and that you earn according to how much effort you put into it. By the end of the first month, I knew one strategy on the one-minute chart and I learned a few things about myself from making many bad trades and only a few good ones.
The first thing I learned is that trading is not a quick way to make money. If you want to make money trading, you have to spend a long time studying the market, learning strategies, and learning trading patterns. I found that when I made a good trade, I would want to go straight into a new one even if there was no reason to hit the buttons.
This takes me to my second discovery: I was greedy. It’s so easy to fall into the habit of thinking you know what you are doing after making a few successful trades. Trading is a fully emotional reliant game that puts you in check when you make mistakes because of arrogance. I found that when I actually took a second to think
about my decision, I made far better choices and took fewer trades, and now I am able to make more accurate trades.
The third lesson I learned is a simple one. Starting with a small account with small position sizes is the best way to start trading if you are a beginner. There have been times where I made a big loss of 30 to 60 cents which could easily have been bigger had my position size been one rand a point. It goes to show that money management is particularly important. Your position size should be proportional to your account size so that you do not blow your account in a few trades. Having a position of 10 with an account size of R1,000 is a bad idea. Start small, gain experience, gradually start making bigger trades.
My final lesson is that you need to learn to check your emotions. My biggest losses were because I saw a trigger that was not there because I was afraid of missing a trade. Do not trade out of fear of missing out. Learn the strategies inside and out so that you do not make the mistake of creating a pattern that doesn’t exist because the market will teach you very quickly that you are not as smart as you think. Do not be afraid of losing trades, because there will be many more in the same day and if you allow one bad trade to influence your emotions the next few could turn out the same way.
My advice to beginners as a beginner is that you must maintain a calm mindset. Learn as much as you can and then get onto the market. Learn to calculate your risk to reward and maintain an equilibrium of your position size and account balance. Understand that bad trades do not mean bad days. Lastly, have confidence in what you learn and not in what you think you know.