Five Top Investing Mistakes to Always Avoid If trading were easy, everyone would be doing it. We’ve all taken big losers. We’ve all left wins on the table. But losses aren’t such a bad thing. And while it’s never fun to lose money, failure can teach us how to become a better traders. Unless of course, you continue to make the same mistakes ad nauseum. Get Small Cap Investing & Understanding Investing in Penny Stocks Ideas for your financial goals. Find suggestions backed up by award winning research reports. Smart investors accept failure as an inevitability – a temporary setback and as a teachable moment on what to do, and what not to do going forward. Top Mistake No. 1 – Riding your Losses Some of us never want to give up on a trade that we truly believe in. However, it’s never a good idea to let your losers ride. Admit you were wrong on a trade, and jump out. Now, that doesn’t mean you can’t buy it again. But for the time being, let it go. Top Mistake No. 2 – You Don’t Use Stop Losses This is one of the worst things any trader can do. One of the biggest issues facing all walks of traders is a severe lack of discipline and structure in stock buying habits. Many fail to use stop losses, or even protect gains with a simple trailing stop loss strategy. Others risk far too much. A friend of mine once made 325% in a week’s time on a trade. Then he risked it all on the very next trade that cost him 90% of that 325% winning. That’s a recipe for disaster. A trader with no plan for action has already lost.
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